Key points
- Income sources in retirement may include Social Security, retirement plans, pensions, brokerage and personal savings accounts.
- Begin by estimating your retirement expenses and health-care costs.
Establish a retirement income strategy
Near retirement
Your sources of income will likely become more complicated once you retire. Instead of having all of your income come from your paycheck, you could be receiving income from Social Security, pensions, IRAs, 401(k)s, personal savings, and possibly part-time employment.
Constructing your strategy
A retirement income strategy provides a blueprint for using these sources to cover your daily living expenses, while helping ensure you don't outlive your money. To develop your own retirement income strategy, you need to:
- Identify your expenses.
- Determine the sources of income you'll use to pay for those expenses.
- Define a plan for withdrawing income so you can afford your expenses, while allowing the remaining savings to continue to grow.
A strategy can also help you achieve your long-term objectives, such as leaving money to charity or to your loved ones. It will also enable you to identify any potential shortfall of retirement income, while you may be able to do something about it.
Accounting for your needs, dreams and legacy
Creating an income strategy is a challenging task, best undertaken with the help of a financial advisor. It involves analyzing your retirement income, expenses, taxes, inflation, health-care costs and your potential life expectancy. Once you have identified your income needs, you need a strategy for drawing that income from your assets, while keeping some assets growing so they last your entire life.
The components behind a typical retirement income stream
An Ameriprise financial advisor can help you sort through the options and plan an income strategy that supports your lifestyle in retirement.
Financial planning services and investments offered through Ameriprise Financial Services, Inc., Member FINRA and SIPC.
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