The bum economy has been torture on retirement savings, and even folks who thought they'd saved well for retirement are considering going back to work rather than withdrawing funds in a down market. Finance web site Kiplinger suggests an alternative.
Photo by *Mickey.
The article suggests taking the classic investment risk pyramid (which places the safest investments at the bottom and more risky investments higher up) and turning it sideways.
In the classic model, even if your investments are diversified, all your assets are at risk at the same time. [Jim Coleman, head of Coleman Financial Advisory Group]flipped the pyramid on its side so that you tap the most conservative, risk-free investments at the beginning of your retirement timeline and let the riskier investments grow until the later years. Your most aggressive assets will have years — and possibly even decades — to grow, creating a source of stable retirement income in the future. "With this divide-and-conquer strategy, you can have the best of both worlds," says Coleman.
Browse the post for more details, then let's hear how your investment strategies have changed since the economic downturn in the comments.
Increase Your Retirement Income [Kiplinger]