2 Signs You're at Risk of Running Out of Retirement Savings

Core Insights - Many older Americans are hesitant to withdraw from their retirement savings due to fears of running out of money during their lifetimes [1] Withdrawal Strategy - A lack of a withdrawal strategy can lead to depleting retirement savings; it is advisable to work with a financial advisor or conduct personal research to develop a suitable plan [2] - The 4% rule is suggested as a starting point for withdrawals, allowing retirees to withdraw 4% of their IRA or 401(k) balance in the first year, adjusting for inflation, which can help savings last for 30 years [3] - Customization of withdrawal strategies is essential; some may need to withdraw at a rate lower than 4% or higher depending on individual circumstances [4] Investment Strategy - While it is prudent to reduce stock exposure upon retirement to mitigate risk, completely eliminating stocks is not advisable [5] - A portfolio heavily weighted towards bonds (90% bonds and cash) may not generate sufficient income for a sustainable withdrawal rate, risking early depletion of savings [6] - It is recommended to consult with a financial advisor to determine a reasonable asset allocation, with a balanced approach that may include a mix of stocks and bonds [7]