Steve and Sally are nearing retirement, and they have many items on their bucket list. Longer life expectancies mean Steve and Sally may need to prepare for two or perhaps three decades of retirement. How should they position their money?1
One approach is to segment your expenses into three individual buckets:
- Typical Living Expenses— Food, Rent, Utilities, etc.
- Optional Spending — Vacations, Dining Out, etc.
- Legacy Assets — for heirs and charities
Next, pair appropriate funds to each bucket. For instance, Social Security might be assigned to the Typical Living Expenses bucket.2
For the optional spending bucket, you might consider investments that pay a steady dividend and that also offer the potential for growth.3
Finally, list the Legacy assets that you expect to pass on to your heirs and charities.
A bucket plan can help you be better prepared for a comfortable retirement.
Call today and we can develop a strategy that may help you put enough money in your buckets to complete all the items on your bucket list.
– Adam Powell, Financial Planner
1. Steve and Sally are a hypothetical couple used for illustrative purposes only. Diversification is an approach to help manage investment risk. It does not eliminate the risk of loss if security prices decline.
2. Social Security benefits may play a more limited role in the future and some financial professional recommend creating a retirement income strategy that excludes Social Security payments.
3. A company’s board of directors can stop, decrease or increase the dividend payout at any time. Investments offering a higher dividend may involve a higher degree of risk. Keep in mind that the return and principal value of stock prices will fluctuate as market conditions change. Shares, when sold, may be worth more or less than their original cost.
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Copyright 2023 FMG Suite.