When younger people ask me what they should be doing for retirement, I often give them pretty simple advice.
Get started.
Pay yourself first. Contribute consistently. Take advantage of the retirement accounts available to you. Then give your money time to work.
I sometimes jokingly tell younger people not to look at the account for 30 years.
Why?
Because if it is doing poorly, they may get scared and stop contributing. If it is doing really well, they may be tempted to take money out.
For a 25 or 30 year old, time can be one of the most powerful tools they have.
But when someone comes to me at 60 or 65, the conversation changes.
What Changes When You Retire?
During your working years, your financial life is generally about accumulation.
You earn money. You save some of it. You invest it. You repeat that process for decades.
Retirement is about distribution.
Now you need those savings to help create income.
That means market losses can feel very different.
Imagine the market drops while you are 35. You are still working, still contributing, and potentially buying investments at lower prices.
Now imagine the same thing happens when you are 65 and withdrawing money every month.
You are no longer just waiting for your balance to recover. You may be selling investments to pay your bills while their values are down.
That can create an entirely different challenge.
How Much Risk Should You Take in Retirement?
I do not believe retirement automatically means you should eliminate investment risk.
You may still need growth to help your money keep pace with inflation and support a retirement that could last decades.
But the amount and type of risk you take should make sense for the job your money now needs to do.
That is why I think the years immediately before and after retirement deserve special attention.
Your goals have changed.
Your income has changed.
Your relationship with your investments has changed.
So why would you assume the same strategy you used to build your retirement savings should automatically be the strategy you use to live on them?
Saving for retirement is one game.
Living in retirement is another.
Make sure your financial strategy recognizes the difference.
If you are getting close to retirement and wondering how to turn your savings into reliable income, call Legacy Retirement Group at 614 336 7660. We can help you take a closer look at your retirement picture and determine what your next steps could be.