Income

Should I Continue Investing in Retirement?

At some point in your life, you’ll shift from saving for retirement to enjoying the fruits of your years of labor. 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 important, though, to shift up your investment strategy to account for your new lifestyle.

Stephanie Faris

Stephanie Faris

Published October 19th, 2021

Key Takeaways

You can extend your retirement savings with the right post-retirement investments.

Diversification is key, from a mix of asset types to a mix of investments within each type.

An expert financial advisor can take a look at your unique situation and recommend the right investments for you.

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 important, though, to shift up your investment strategy to account for your new lifestyle.

Questions about investing in retirement? We're here to help.

Schedule your FREE Retirable consultation today.

Investing in Retirement Considerations

When you think of investing in retirement, you probably immediately consider the years you’re spending building a 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 in retirement, it’s more important 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 put a huge damper on your retirement spending. Saving money after retirement means striking the right balance of stocks and bonds, as well as 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 you’ll use. Diversification isn’t just about choosing a mix of stocks and bonds, but it’s also about diversifying within each of those asset classes. Your goal should be to build a portfolio full of assets that won’t all crash or thrive at the same time. This will ensure you can counterbalance things if one section of your portfolio has a rough year.

Have Some Cash On Hand

One of the biggest concerns retirees have is, “Will I outlive my retirement savings?” This 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 at least 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 will 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 look at your own finances and help you with a plan.

Have a Drawdown Strategy

If you look at a group of retired people to see how do retirees spend their money, chances are you’ll see spending habits across the spectrum. But no matter what, unless you have more income coming in than you’re spending, you’ll gradually deplete your savings. 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.


Share this advice


Stephanie Faris
Stephanie Faris

Stephanie Faris has written about finance for entrepreneurs and marketing firms since 2013. She spent nearly a year as a writer for a credit card processing service and has written about finance for numerous marketing firms and entrepreneurs. Her work has appeared on Money Under 30, The Motley Fool, MoneyGeek, E-commerce Insiders, and GoBankingRates.

Income and expenses charts

Free Retirement Consultation

Still have questions about how to properly plan for retirement? Speak with a licensed fiduciary for free.



Share this advice


Stephanie Faris
Stephanie Faris

Stephanie Faris has written about finance for entrepreneurs and marketing firms since 2013. She spent nearly a year as a writer for a credit card processing service and has written about finance for numerous marketing firms and entrepreneurs. Her work has appeared on Money Under 30, The Motley Fool, MoneyGeek, E-commerce Insiders, and GoBankingRates.

How Can You Spend Retirement?

See how your savings can cover your retirement lifestyle and goals.

personal-plan

How Can You Spend Retirement?

See how your savings can cover your retirement lifestyle and goals.

personal-plan

To empower a confident, worry-free retirement for everyone.

Legal

Retirable, Inc. ('Retirable') is an SEC registered investment advisor. By using this website, you accept our Terms and Conditions and Privacy Policy. Retirable provides holistic retirement planning services, which are available only to residents of the United States. You must be at least 18 years of age to become a Retirable Premium user. Nothing on this website should be considered an offer, solicitation of an offer, or advice to buy or sell securities.

Investing involves risk and past performance is not indicative of future results. Increased spending increases the risk of depleting your savings and performance is not guaranteed. It is very important to do your own analysis before making any decisions based on your own personal circumstances.

For more information, see our Form ADV Part II and other disclosures.

Retirable is a financial technology company, not a bank. Banking services provided by Blue Ridge Bank N.A., Member FDIC. FDIC insurance is available for funds on deposit up to $250,000 through Blue Ridge Bank N.A., Member FDIC. The Retirable Visa® Debit Card is issued by Blue Ridge Bank N.A. pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa debit cards are accepted.

* Annual Percentage Yield (APY) of 5.12% is effective as of Aug 1, 2023. This is a variable rate and may change after the account is opened. Fees could affect earnings on the account.

** Refer to the fee schedule in your Consumer Deposit Account Agreement

© 2024 Retirable Inc. All rights reserved.

We're accredited and certified by

To empower a confident, worry-free retirement for everyone.

Legal

Retirable, Inc. ('Retirable') is an SEC registered investment advisor. By using this website, you accept our Terms and Conditions and Privacy Policy. Retirable provides holistic retirement planning services, which are available only to residents of the United States. You must be at least 18 years of age to become a Retirable Premium user. Nothing on this website should be considered an offer, solicitation of an offer, or advice to buy or sell securities.

Investing involves risk and past performance is not indicative of future results. Increased spending increases the risk of depleting your savings and performance is not guaranteed. It is very important to do your own analysis before making any decisions based on your own personal circumstances.

For more information, see our Form ADV Part II and other disclosures.

Retirable is a financial technology company, not a bank. Banking services provided by Blue Ridge Bank N.A., Member FDIC. FDIC insurance is available for funds on deposit up to $250,000 through Blue Ridge Bank N.A., Member FDIC. The Retirable Visa® Debit Card is issued by Blue Ridge Bank N.A. pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa debit cards are accepted.

* Annual Percentage Yield (APY) of 5.12% is effective as of Aug 1, 2023. This is a variable rate and may change after the account is opened. Fees could affect earnings on the account.

** Refer to the fee schedule in your Consumer Deposit Account Agreement

© 2024 Retirable Inc. All rights reserved.

We're accredited and certified by