Advice For A Financially Safe Retirement

Many people would want to have a stable and secure income to look forward to when they retire. It will help keep them financially stable and ensure that they have the funds they need to continue enjoying life without the worries of work and the stress that comes with it. But they also have to make sure that their retirement fund is not put to a certain risk as it continues to provide for them. Here are some of the ways in order to make sure that retirement income is still being received while continuing to prevent it from certain levels of risk.

Invest In Bonds

Bonds are considered as safe investments. If one buys a bond certificate, that means that the seller of the bond owes the buyer some money. It is a safe instrument in that it rarely loses. Aside from the principal, bond buyers can enjoy regular interest payments. The disadvantage though is that it may not be as lucrative as other investments. But considering that retirees would wish to lessen their risks, bonds may provide the safest option available.

Don’t Rely On Home Equity

Some retirees may feel secure just because they still consider the funds that they may be able to get out of their home equity. But this can be very risky. Home values can sometimes suffer from sudden drops that may greatly reduce or even wipe out the expected retirement fund. This can become a very dangerous situation that can greatly trouble retirees. It is better to develop a different retirement fund based on other safer and more stable investments and consider home equity as a potential backup plan.

Invest In Income Property

Although it might be a costly investment for some, but having some income property might help make one’s retirement more comfortable. Income property such as rentable apartments, homes and other real estate can ensure that retirees still continue to get a check each month that becomes part of their retirement fund. But being the landlord, retirees may also consider continuing to be bothered by property taxes and maintenance costs for the properties.

Use A Systematic Withdrawal System

If you have a lump sum that you do not have some use yet, you may wish to place it in an investment account that offers a systematic withdrawal plan. Through such an account, you may be able to instruct an investment company the manner in which the sum of money might be distributed. It can be withdrawn for a certain amount on a monthly, quarterly or annual basis. This may help prevent the account owners from withdrawing too much of what they don’t need as of the moment.

 

Posted by Ardent Editor on Mar 2 2011 in Financial Planning Tags: , , , , ,

  • Sponsors