Smart Management of Retirement Income—Managing Investment Portfolios
Your Retirement Nest Egg
The amount of money you have when you begin retirement is one of the most important factors in determining how to manage those assets during retirement.
If you have a large enough portfolio, it may generate enough income so that, with prudent spending, you never need to dip into your principal. If that is your situation, a combination of bank products such as CDs and Treasury bonds to preserve your principal, along with dividend-producing stocks and bonds may be the starting point for your investments in retirement.
On the other hand, if you’re like the majority of retirees, you’ll begin retirement with a more modest nest egg that will require you to tap your principal at some point. One important decision is how much to withdraw and from what account(s). Another is how much risk you want to incur, if any, in an attempt to grow your nest egg. You will also want to take into account whether your spouse is still working and how long it will be before he or she retires.
Unfortunately, there are no easy answers or failsafe ways to manage any investment portfolio. But there are some helpful concepts and general guidelines that can help you decide what is best for you, and also avoid serious mistakes that can jeopardize your financial wellbeing.