Your paycheck in retirement

Do you know where your “paycheck” is coming from in retirement? You’ll be transitioning from the accumulation phase to the distribution phase, and creating your own paycheck for this season in life. It can be uncomfortable at first! Where will my income come from? And how fat can my “paycheck” be? These are some of the questions you’ll want to answer before retirement, as you’re planning for financial freedom!

5 possible sources of income…

PENSION

These aren’t as common anymore. If you’ll have one, it may be a lump sum payout, or a monthly one.

SOCIAL SECURITY

The big question here, is when will I claim, and how much will it be?

NEST EGG

Monies here have been invested for the future. They may include your current 401ks, an HSA (if using as an investment), IRAs, brokerage accounts, and alternative investments.

PASSIVE

Do you own real estate that generates passive income?

EARNINGS

You may choose to have a side hustle, or do part-time work.

What’s Your Gap?

Do you have a gap, between what you think you’ll spend (I discussed this in my last newsletter), and what your expected income sources will produce? This is your gap need. Knowing this will help you plan your financial freedom. You may choose to increase your earnings in your working years, lower your spending, increase your savings rate, and/or work longer. Or, maybe you’ll close that gap quicker than you thought, and you can retire sooner!

Financial freedom is a number, not an age. Planning carefully now, while you’re in the accumulation phase, will help you retire “to”, with confidence!