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Simple Strategy to Spend Safely in Retirement | Kiplinger
Delaying Social Security and using RMD rules to draw down your nest egg is a winning combination for middle-income retirees.
getpocket.com
New research concludes that the best way to produce a retirement paycheck really is that simple. The Stanford Center on Longevity, in collaboration with the Society of Actuaries, conducted a study comparing hundreds of retirement-income strategies, including various combinations of variable and fixed annuities, systematic portfolio withdrawals, reverse mortgages and delaying Social Security.
One approach, which the researchers dubbed the “Spend Safely in Retirement Strategy,” works well for a broad swath of middle-income retirees, the study finds. And it’s not exactly rocket science: It involves delaying Social Security and using the IRS required minimum distribution tables to draw down your nest egg.
Generating retirement income has become a major issue for retirees, says Steve Vernon, research scholar at the Stanford Center on Longevity and co-author of the study. Traditional pension plans that guaranteed lifetime income are disappearing, replaced by 401(k)s and other defined-contribution plans that rarely offer guaranteed-income options.