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Retirement Planned Investments

February 09, 2017

At DunnCreek Advisors, we’re invested in helping you have a successful retirement; that’s why we provide retirement advising services in St. Paul, MN. Our retirement financial advisors can help you formulate a retirement investment plan that will not only help you save money for retirement but will help ensure that you know what your retirement expenses will be and how you can save enough money now to afford them later on.

Creating a Retirement Investment Strategy

When looking into creating a retirement investment strategy, you will have several factors to consider. You will need to know how long your retirement will last, how much your retirement will likely cost, what sources of income you will have (including investments), and what investment strategies would work for you. It’s important to think about these factors carefully, as they will determine how much you ultimately set aside for your retirement. Although there are many investment strategies to consider, one of the most useful, simple retirement strategies we suggest is the retirement bucket plan, which helps you consider your expenses and how you will pay for them.

Plan for Retirement Expenses with the Retirement Bucket Plan

The retirement bucket plan considers three “buckets:” your basic living expenses, including rent or home payments, utilities, groceries, necessities; discretionary spending, including vacations, dining out, travel, home improvement projects; and legacy assets, or assets that will be left to heirs and charities. Once you determine your expenses during retirement, you can pair appropriate investments to each bucket, ensuring that you know how you will be funding each “bucket” of expenses. We suggest using your investments as follows:
Social security could be used to fund the basic living expenses; this is often the way many retired individuals pay for groceries, gasoline for vehicles, home or apartment payments, and the everyday expenses you will incur. For the discretionary spending “bucket,” we recommend utilizing investments that pay steady dividends and offer the potential for growth. These types of investments can end up ensuring that you have more money set aside for discretionary spending than you’d originally plan for. The assets you intend to pass on to your heirs and charities may come from savings, additional social security left over after the cost of your living expenses, or other investments. The way that you invest in your legacy “bucket” will depend on how much you’re aiming to set aside for that purpose.
Not everyone’s retirement investment plan is or can be the same, and the types of investments you have will determine the types and amounts of assets you are able to accumulate to pay for your expenses during retirement. To learn more about using the retirement bucket plan, or for information about other retirement investment planning that may work for you, contact DunnCreek Advisors at 612-436-3770 or rdunn@dunncreekadvisors.com, and start planning with our St. Paul, Minnesota retirement investment plan advisors today.