At some point in your life, you'll shift from saving for retirement to enjoying the fruits of your years of labor. But even if you've planned out when to stop saving for retirement, the move can be scary, especially if you're concerned about making your savings last.

When the saving stops and the spending begins, though, there's another option. You can stop saving, start investing, and earn a little extra income on the money you've saved. It's essential to shift your investment strategy to account for your new lifestyle.

Investing in Retirement Considerations

When you think of investing in retirement, you probably immediately consider the years you'll spend building retirement savings through investments. But investing can continue well after you retire. Here are a few tips to help.

Maintain the Right Portfolio Mix

Diversification is a wise idea at any age, but it's more important in retirement than ever. When you're living on Social Security payments, 401(k) payouts, and distributions from your IRAs, losing money on the stock market can significantly dampen your retirement spending. Saving money after retirement means striking the right balance of stocks and bonds and routinely rebalancing your portfolio to keep the risk level aligned with your goals.

Use Diversification Strategies

Once you've established that diversification is one of the best ways to invest after retirement, it's time to decide what strategy to use. Diversification isn't just about choosing a mix of stocks and bonds. Still, it's also about diversifying within each of those asset classes. Your goal should be to build a portfolio of assets that won't all crash or thrive simultaneously. Building your portfolio will ensure you can counterbalance things if one section of your portfolio has a rough year.

Have Some Cash On Hand

One of retirees' most significant concerns is, "Will I outlive my retirement savings?" Outliving your retirement can happen, but a more pressing issue is whether you'll have enough liquid assets to rely on when something comes up. If your home needs a new HVAC system or you have to buy a new car, having your funds tied up in stocks or CDs can be a problem. You'll need to keep some of your cash available for those emergencies.

Be Disciplined About Withdrawals

Figuring out how to spend down retirement assets can be complicated. Even experts differ on how much retirement savings should be withdrawn each year. The important thing is that you have a plan. Many experts recommend taking out a small amount of your savings each year—typically less than 5 percent. But it's best to work with a financial expert who can examine your finances and help you develop a plan.

Have a Drawdown Strategy

If you look at a group of retired people to see how retirees spend their money, chances are you'll see spending habits across the spectrum. But no matter what, you'll gradually deplete your savings unless you have more income than you're spending. That's why it's important to have a solid strategy for which accounts you'll tap out first.

Final Thoughts

Whether you’re wondering how to spend money in retirement or planning how you’ll continue to invest, it can be tough to do it on your own. There’s no one-size-fits-all strategy when it comes to retirement planning. It’s always best to sit down with a Certified Financial Planner (CFP®) to map out the best strategy for your unique situation.