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What investment choices should I make to live comfortably in retirement?


Your retirement may have many facets – volunteering, traveling, relaxing, spending time with family. But one thing’s for sure. In order to live comfortably in retirement, you’ll need income to replace the paycheck you brought home during your working years.

Social Security and a company pension, if your company offers one, provide a foundation for your retirement income. But the two combined may cover just a portion of what you need.

This graph shows how Social Security and a pension cover only about 80% of expenses for retirees with modest needs. The higher your needs, the less these income sources will cover.

Filling the gap

Filling in the gap

To fill the retirement income gap, investments and other personal assets will be a necessary part of your retirement income. These may include IRAs, employer-sponsored plans such as a 401(k) or 403(b), mutual funds, stocks, CDs and savings accounts, all invested with the goal of providing a balance of:

  • Income to meet living expenses
  • Growth to offset the effects of inflation
  • Safety to reduce risk

Personal assets also may include proceeds from rental properties or the sale of a house, an inheritance, or salary from a post-retirement job.

Planning for your retirement income is crucial, whether you’re five years or 25 years away from retirement. The good news is you don’t have to figure it out alone. A financial advisor with Waddell & Reed can work with you to determine:

  • How much retirement income you need to support your retirement goals
  • Your projected Social Security benefit
  • Your pension benefit, if applicable
  • The income gap you need to fill
  • Your personal assets that can fill the gap
  • Investment strategies to meet your retirement needs and manage risk

Don't go it alone.

Our national network of financial advisors can help you create a retirement income plan as part of your personalized financial plan.

Find An Advisor Today

Associated Tags: Retirement

This information is provided for educational purposes only and may include references to concepts that have legal, accounting and tax implications. It is not to be construed as legal, accounting or tax advice, and is provided as general information to assist in understanding the issues discussed. It should not be considered investment advice, nor does it constitute a recommendation to take a particular course of action. Waddell & Reed does not provide tax or legal advice. Please consult with the appropriate professional regarding your personal situation prior to making any financial related decisions.