Retirement is supposed to be your time to enjoy yourself. You’re free from the structure and commitment of work. You’re in control of your schedule. You can travel, pursue a new hobby, enjoy time with loved ones or simply spend time enjoying your newfound freedom.
Of course, financial worry could dampen your ability to enjoy retirement. According to a recent study from Gallup, more than half of Americans are worried they won’t have enough money in retirement. In fact, retirement has been America’s top financial worry since Gallup started the survey 16 years ago.1
If you’re concerned about your financial stability in retirement, you may want to look at your projected income. Specifically, the more you can increase your guaranteed* income, the less reliant you may be on withdrawals from savings. That could reduce your exposure to market volatility and other threats.
Fortunately, there are steps you can take in your retirement strategy to maximize your sources of stable, predictable income in retirement. Below are three such steps. If you haven’t implemented these actions, now may be the time to do so.
Wait to file for Social Security.
You’ll likely become eligible for full Social Security benefits sometime between your 66th and 67th birthdays.2 However, you don’t have to take benefits at that time. You can wait all the way until age 70, and there is substantial benefit to doing so.
For every year you delay benefits past your full retirement age, your benefit increases 8 percent. You can delay the benefits up to age 70. If, for example, your full retirement age is 66 and you delay to age 70, your benefit amount could increase 8 percent for four years. That’s a total increase of 32 percent.3
Although it may be tempting to file for benefits as soon as possible, the increased benefit amount could provide valuable income stability in retirement. The increased payments could help you fight inflation, offset market volatility or even pay for costly health care.
Consider part-time work.
The whole point of retirement is to stop working, so the idea of generating side income may not be appealing. However, part-time work could yield valuable benefits. There’s the added income, which could help you deal with financial challenges. If you’ve reached full retirement age, you can earn as much as you want without the wages impacting your benefits. If you are younger than full retirement age, however, your side income could affect your benefit amount.
There are other benefits to working besides the income, however. Part-time work may give you a chance to socialize with others, meet new friends and overcome boredom. It may give you newfound purpose in retirement. Your part-time job could simply give you an opportunity to participate in a hobby or activity that you love.
Consider an annuity.
Annuities offer a number of ways to convert your savings into a guaranteed lifetime income stream. For example, you could purchase a single premium immediate annuity, which converts a lump sum into a lifetime income stream based on your age and other factors.
Deferred annuities may offer growth potential, either through interest payments or through investment in the market. Many of these annuities allow you to take withdrawals that are guaranteed for life. This kind of predictable income may eliminate stress and worry so you can enjoy your retirement.
Ready to maximize your guaranteed income in retirement? Let’s talk about it. Contact us at Bridgeriver Advisors. We can help you analyze your needs and develop a plan. Let’s connect soon and start the conversation.
*Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values.
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
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