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3: Analyze Your Decisions

Managing Savings and Investments Before and After Retirement

retirement planning saving and investing

General Guidelines

  • Save as much of your annual income as you possibly can toward retirement.
  • Make sure you have enough money for at least 30 years of retirement.
  • Diversify your investment mix so you can address inflation and longevity over the course of your retirement.
  • Generate income with investments during your retirement to supplement your Social Security benefits.
  • Keep (and replenish) emergency funds in cash – emergencies happen, even in retirement.
  • Set aside at least one year's worth of living expenses (after Social Security and/or a pension) in readily available cash (money market mutual fund or CDs) as a hedge to selling riskier investments in a down market.
  • Review your investments regularly to ensure that they are providing desired returns and meeting your cash flow needs.

Average Monthly Social Security Benefit, 2017

Source: Social Security Administration

It’s hard to say how long your retirement will last. Depending on your lifestyle, health and age at retirement, it’s not unreasonable to expect to live up to 30 years in retirement. With the average monthly Social Security benefit of $1,360.00, you will want to use diversified assets to generate additional income for your retirement lifestyle.

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Reliable Resources

  • AARP offers advice on protecting your retirement savings.
  • Choose to Save, developed by the Employee Benefit Research Institute and American Savings Education Council, offers savings tips, calculators and articles about managing your retirement savings.
  • FINRA Investor Education Foundation offers articles on saving, investing and protecting yourself from fraud.
  • from the U.S. Security and Exchange Commission introduces the basics of investing, research you should conduct and finding the right investment professional.
  • My Retirement Paycheck is SAM’s sister site dedicated to retirement issues. Check out the information on saving and investing if you need additional help.
  • The U. S. Department of Labor produced Savings Fitness: A Guide to Your Money and Your Financial Future to provide steps toward a better future, even if you’re living paycheck to paycheck.
  • The U.S. Securities and Exchange Commission provides information about asset allocation and questions you should ask about your investments.
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What is Your Progress Toward Your Retirement Income?

Will you be able to meet the idealized retirement you’ve envisioned? Write down answers to the following questions to begin thinking about what you will need to do between now and retirement to provide the lifestyle you will want:

  1. What will cost the most in your retirement? This might include housing, health care costs, helping family members, traveling or simply enjoying any hobby you have.
  2. What investments or savings do you have saved toward that particular cost? Do you have resources to fund other areas of your desired retirement?
  3. What plans do you have for diversifying your assets so you can fund your retirement lifestyle and provide yourself with a continuing stream of income?
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