Ideally, we would all enter our retirement years fully confident that our investment and retirement planning efforts would translate into comfortably maintaining our desired lifestyles until the day we die. However, retirement planning, like most important things, is not that simple.

The importance of making your retirement dollars last through retirement equals that of investing and saving for retirement. It’s an exercise that requires balancing the right mix of financial strategies with emotional behaviors.

Fortunately, there are practical strategies that will help stretch your retirement dollars without aggravating “budget stress” during retirement. Here are six to consider:

1. Get serious about retirement planning sooner than later. As noted above, there is more to retirement planning than investment strategy and saving a certain dollar amount. Future lifestyle, budget, and healthcare considerations are just a few potential challenges awaiting you. By planning sooner than later, you will have more options and increase your odds of success.
   
2. Be realistic about your life expectancy. Most of us would agree that few things would be worse than depleting our retirement nest egg by age 82 and living until age 95…on Social Security alone. It may be comforting to consider our family health history and assume that because our parents and siblings died in their early seventies that we will too, but that may not be the case. The old saying “Hope for the best, but plan for the worst” is worth noting. Life expectancy is impossible to predict; therefore, the key point is to save more and start saving earlier to prepare for the possibility that you will live 30 plus years beyond your retirement date. 
   
3. Consider long-term care insurance. Healthcare costs are an enormous threat to financial security during retirement, especially if long-term custodial care comes into play. The need for long-term care can quickly wipe out an individual’s or couple’s retirement savings. Investing in a long-term care policy can help ensure that your retirement savings remains intact.
   
4. Maintain a short-term emergency fund. Financial planners frequently recommend maintaining a six-to-nine-month emergency fund during an individual’s working years to protect against unexpected income loss. A similar strategy can be beneficial during retirement years to protect against drawing down retirement assets when adverse market conditions are present. A recent example is the 2008 stock market crash when the S&P 500 Index lost roughly 37% of its value. Those individuals having an emergency fund avoided the need to sell assets at temporarily depressed prices, thereby enabling their investments to participate in a strong, lengthy market recovery that began in 2009.
   
5. Establish a smart distribution strategy. Retirement income is typically derived from multiple sources such as 401(k) accounts, rollover IRAs, regular IRAs, Social Security, and pensions. IRA and 401(k) balances may be pre-tax and/or Roth in nature. How and when those sources are tapped can have a profound effect on taxation and their longevity. It makes sense to work with an experienced Financial Advisor or Wealth Manager to develop a distribution strategy that is right for you.
   
6. Continue working with a Financial Advisor/Wealth Manager. Retirement planning should not automatically end upon retirement. Your needs and circumstances, market conditions, and economic factors will continue to change throughout the balance of your life. A seasoned advisor can help you stay on track by recognizing risks that you may not.

Summary. Retirement can last for decades, so do everything possible to make it comfortable, meaningful, and fun. By adhering to the six points listed above, you will increase your odds of doing exactly that. As Alan Lakein said, “Planning is bringing the future into the present so that you can do something about it now.”

To discuss your retirement outlook, please reach out to me at (608) 826-3568 or any member of our Wealth Management team today.