Your Retirement Distribution Plan
Retirement seems easy. You put money away and you take it out when you retire. Not so fast. Your retirement distribution plan should be based on a preset and well thought out strategy.
Most people know their retirement strategy is a two part strategy. First, you have to put money away. Without that phase there is no phase number two.
Phase number two is the distribution of these saved funds. That is your retirement distribution plan to keep it simple.
When you first begin your retirement plan you are like everyone else. You have no idea what your retirement distribution plan will be. You have not formulated what your life will be like in retirement.
You don’t have a clue what your retirement personality will have morphed into or what your needs will be. Welcome to the club.
If you talk to 100 different financial advisors you will get 100 different answers on when you should prepare your retirement distribution plan. It is my belief a person gets a strong grip on whom they will be in retirement and what they will need in the way of money starting about 45 and maybe even up to 50 years of age.
I haven’t performed any scientific or academic studies. I have only spoken with people on an ad hoc basis and this is what I picked up. They had an idea of what they would do in retirement and how much money they would need somewhere around 45 to 50 years of age.
Where they were short was in what to do with the dollars in their account. They didn’t know if they should open a Roth IRA and rollover their money or leave it alone or convert those dollars into an immediate annuity and start drawing a check for life.
I am not here to tell you what to do because I don’t know your situation. You know your situation so you have to make those decisions as part of your retirement distribution plan.
However if you are one of those people who has a handle on what they will be in retirement now is the time to begin compiling your retirement distribution plan in earnest. Decide when you will retire. Decide when you will begin taking a check. Decide if you will continue to work part time or on an as needed basis.
The one thing you do not want as part of your retirement distribution plan is to completely cash out your retirement account. The very real possibility of spending all that cash or losing it in unwise investments will always loom large. Keep it in an account that is still paying interest. This means it is growing and compounding until you decide to take a check.
Your retirement distribution plan doesn’t have to be complicated to construct or to put into motion. It has to be a retirement distribution plan constructed around you and your life style. Only you know you and what you want or what you will do when you retire.
Take the time to personalize your retirement distribution plan and you should have a plan that will take care of you during your retired years. Your retirement distribution plan is important. Take the time to build it correctly.
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