There’s a lot of investing advice out there, but how do you know what’s right or what’s right for your specific situation? The rules can change a bit when you get closer to and enter retirement, and the world of investing is constantly changing. There’s a lot to know about investing in retirement, and we can help you learn.
The World of Investing Has Changed
Cryptocurrency? Non-Fungible Tokens (NFTS)? The world of investing has changed quite a bit during your lifetime. During this time of low-interest rates and high inflation, those nearing and in retirement should consider how they will make their money last for the rest of their lives. There could be investing strategies available to you that you don’t know about or haven’t considered in the past that a financial advisor can teach you about.
Your Risk Tolerance Can Decrease
A market correction could pose a particular threat to you as you near and enter retirement. Two retirees with identical wealth and long-term market averages in retirement can have very different financial outcomes depending on the state of the economy when they begin retirement. Someone retiring during a bear market might see their portfolio recover as the market does, but they may also see a reduction in the overall return of their portfolio because of how much they had to withdraw early on when prices were down.[1] Have a plan for how you would handle a major market correction this year and in the future.
A Plan is Different From a Portfolio
Now that you’ve accumulated wealth, the question becomes how you’ll use it to fund your retirement. This can be complicated because having a portfolio isn’t the same thing as having a comprehensive plan. You may want to think about how you’ll draw down your assets so that your tax bill is minimized, whether you’re taking on an appropriate amount of risk, and what your retirement lifestyle goals are. You may also want to rethink one-size-fits-all investing advice like the 4% rule, which says you can withdraw 4% from your 401(k) each year to make it last throughout retirement.[2]
[2] https://www.investopedia.com/terms/f/four-percent-rule.asp
The commentary on this blog reflects the personal opinions, viewpoints, and analyses of BML Wealth Management’s employees providing such comments and should not be regarded as a description of advisory services provided by West Wealth Group, LLC. The views reflected in the commentary are subject to change at any time without notice. Nothing on this blog constitutes investment advice. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Past performance is no guarantee of future returns.
Investment advisory services through West Wealth Group, LLC, an SEC Registered Investment Adviser. BML Wealth Management and West Wealth Group, LLC are affiliated entities. Insurance Services are offered through BML Wealth & Insurance Services, California Insurance License #0M15550.
We do not provide tax or legal advice, all individuals are encouraged to seek guidance from qualified professionals regarding their personal situation. Any references to protection benefits or steady and reliable income streams in this guide refer only to fixed insurance products. They do not refer, in any way, to securities or investment advisory products.
