Make Your Money Last During Retirement

Okay, so you have scrimped and saved and worked hard to build up a nice retirement fund; how are you going to ensure that this fund will be able to last as long as you need it? Statistics have shown that the average American lifespan continues to increase. As a result, the number of retirement years continues to follow suit. It is not unheard of for the length of a retirement to reach as high as 40 years. In this situation, the last thing a person would want is for their funds to run dry at year 37. With this in mind, let's examine some of the ways in which a retiree can effectively make his money last.

Money Stretching Retirement Tips

• Move to an economically friendly region. This may entail moving to a nearby city or a faraway state. To give an example of the potential cost savings, a $400,000 home in San Francisco may cost $100,000 in Texas. Additionally, other cost of living items will vary dramatically from area to area.
•  Downsize. Once retirement arrives kids have generally move from the home, which makes it possible to relocate to a smaller dwelling. This typically produces lower monthly payments, or in the event that the home was paid off it enables the homeowners to tap into the available equity.
• Part time work.  For some, this option is a good way to earn a bit of extra income. In addition, many retirees find that they do not end up staying as busy as they anticipated. A part time job provides a chance to spend some of their extra time working in a field of interest with people that they enjoy.
•  Don't take Social Security early. Waiting until the age where an individual will receive his maximum payment, will produce a 20% increase. Over the course of a retirement this can become a significant amount.
• Scale back on withdrawals. Evaluate the levels of your withdrawals that you plan on taking from your 401K amount. A slight adjustment could potentially stretch your fund to the desired level.
• Delay retirement. In the recent bear market there are many people who lost a sizeable portion of their retirement savings. In situations such as these there may be little choice but to postpone retirement until additional savings are accumulated. In order to lessen the likelihood of losing big, many experts suggest shifting an investment portfolio to a more conservative position as an individual begins to get closer to retirement age.