Turn retirement savings into a reliable income stream
You know how important it is to save for retirement. But have you started thinking about how you will manage your money once you've retired? It can be just as important.
A good way to get started is by developing a retirement income strategy. Think of it as a personalized road map that involves investing your savings in ways designed to generate the income you need to live.
Your plan may include investing in one or more of the following:
Many people combine two or more of these investment vehicles to leverage the features of each.
For example, an income annuity provides a guaranteed income stream for life, assurance and predictability. Mutual funds offer control over how savings are invested and the flexibility to access funds if needed. By splitting retirement savings between the two, you can enjoy the features of each.
What's your plan?
Creating a workable retirement income plan is different for everyone. In order to determine the strategy that works for you, ask yourself:
- How comfortable am I with market risk?
- Will I have a lot of ongoing expenses, like rent or car payments, during retirement?
- Will I have income from a pension plan, rental income or a small business?
- How important is having a lifelong guaranteed income stream to me?
- How actively do I want to manage my retirement savings?
Closing the gap
In addition to your employer-sponsored retirement savings plan, here are other sources that may help you close the financial gap during retirement.
- Personal savings (such as annuities, CDs, mutual funds and savings accounts)
- Monthly Social Security payments
- Retirement plan savings from previous employers
- Part-time employment
- Rental income
Working with a financial professional
More articles from the introductory issue of The Principal Retirement NewsletterSM
- What Will Your Retirement Age Be?
- Five Retirement Income Risks—and How to Help Avoid Them
- Social Security and You
- Healthcare, Medicare and More
- Six Steps for Creating Your Retirement Income Plan
- Retirement Tools and Resources
Download the entire introductory issue (PDF: 860 KB)