Ways to Avoid Outliving Your Retirement Income

retirement long life expectancy capital income financial planning total returns tax efficiency senior couple

Americans have been experiencing increasingly higher life expectancy over the last few decades which of course is a good thing, but it does also present certain challenges when it comes to planning for retirement. The longer you live, the more time you will spend in retirement which means that you will need that much more capital to sustain your preferred quality of life during your golden years. According to research done by the Center of Retirement at Boston College, retirees today have a life expectancy that is 40% longer than retirees in the 1970s.

Fortunately, there are actions you can take to maximize your capital in order to ensure you don’t outlive your resources.

Focus on total returns, not only income

Investing for retirement is not only about looking for income after you stop working for a living.  Really, you want to take total returns into consideration when reviewing your portfolio. Total returns also include dividends, capital gains, interest, and distributions that you receive over a  specific period of time. All of these factors will contribute to the resources you have available to sustain you through retirement.

Maximize Social Security benefits

You should explore various ways to maximize the benefits you will receive from Social Security.  In order to do this, it is necessary to fully understand the rules and regulations surrounding these benefits. Some of the aspects that you will need to consider are your age, the amount of resources you need to maintain your preferred quality of life, and your marital status. A professional financial advisor should have the knowledge necessary to assist you in understanding your options. Contact Paramount Wealth today to plan the best way to utilize your Social Security benefits.

Tax efficiency

One of the most significant obstacles to accumulating enough resources for your retirement is the tax liabilities associated with investment returns. Although you are not going to be able to completely avoid paying taxes on investments that garner you a positive return, you can take actions that can minimize how much you owe on these taxes. This will require that you have knowledge of all of the rules that govern taxation on investment gains which can be quite complicated for those without financial expertise.

Fortunately, the professionals at Paramount Wealth can help you create a strategy to minimize these tax liabilities. We can even work closely with your accountant to make sure your tax strategy is consistent with your overall financial objectives.

Develop a comprehensive financial plan

Each of these actions taken by themselves is not enough to ensure your retirement income and capital will sustain you for the rest of your life after you retire from working full-time. Your financial plan will need to be holistic and comprehensive, taking into consideration your life goals and financial objectives as a whole. Paramount Wealth takes pride in really getting to know our clients in order to fully understand your vision for your retirement years. Let us get you started on making your vision a reality.



Any opinions are those of the author and not necessarily those of Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Raymond James and its advisors do not offer tax or legal advice. You should discuss any tax or legal matters with the appropriate professional.