4 Retirement Rules You Can’t Afford to Break | Personal Finance


4 Retirement Rules You Can't Afford to Break | Personal Finance







Retirement should be a time of unprecedented freedom when you can enjoy your days indulging hobbies or traveling the world. But that doesn’t mean there are no rules to follow.

In fact, there are four key rules that you can’t afford to break if you want to have the financial stability to actually enjoy your later years. Here’s what they are.

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1. Maintain an appropriate asset allocation

As a retiree, it’s imperative to do all you can to make sure your investment accounts don’t dwindle to a dangerously low level. One of the most important steps to make that happen is to ensure you’re invested the right way.

When you’re withdrawing regularly from your retirement accounts, you can’t afford to have too much exposure to stocks. If you do, you could be forced to sell losing investments during a downturn because you need the money — rather than being able to wait out a bear market until an inevitable recovery.

On the other hand, while you can’t afford to have too much invested in the market, you also can’t have too little. Otherwise, your investments may not produce a large enough return to maintain a reasonably sized account balance as you take distributions.


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