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Spending in Retirement: From Nest Egg to Income
Most people prefer a known monthly payment to the complex decision of investing a lump sum to cover their financial needs during retirement. Income versus a nest egg is conceptually more closely tied to what most of us are ultimately interested in for retirement – maintaining our standard of living, continuing to travel, and so on….Yet, while the benefits of building a nest egg are well-recognized, relatively few people know whether their retirement savings can generate sufficient annual lifetime income to meet their goals. In other words, while the concept of retirement “accumulation,” or amassing a lump sum during one’s working years, is widely understood, the other side of the equation – the drawdown or consumption of one’s nest egg – is less familiar to many people. And with longer lives, our accumulations may need to stretch into income that lasts 20 or even 30 years. Read More…