Is it possible to make $500,000 to support you througho🐻ut your retirement? Yes, but it takes some careful planning, adjustments, and smart i🔯nvesting moves.

Estimate Annual Expenses in Retirement

Start by establishing how much you will be spending each year of your retirement. It’s time to 澳洲幸运5开奖号码历史查询:make a budget. So, add together all your expected expenses.

According to , financial advisor and founder of Ametrine Wealth, most people will need to replace approximately 70% of their income after they retire. The percentage isn’t closer to 100% because once you retire, you may be able to stop saving for retirement, and taxes are often lower for retirees. “And many people end up paying off their mortgage ar꧙ound the time they retire, so that expense goes away,” saℱys Adams.

So your annual expenses have changed, but you also need to look at your income sources. Don’t forget to include your 澳洲幸运5开奖号码历史查询:Social Security benefits, any annuities, stock dividends you expect, and the pension you💟 may have from a former employဣer.

“Pensions, if youꦓ’re lucky enough to have one, are wonderful, because the more income you have, the less you have to withdraw from 🦂your portfolio for retirement. Social Security and pensions are also guaranteed for life, unlike your investment portfolio,” Adams says.

Use the 4% Rule

When withdrawing money from your retirement savings, most advisors would say it is wise to follow the 4% rule. According to this rule, you should be able to withdraw 4% of your retirement savings balance in ꧟the first year after you retire. Then adjust for inflation and withdraw the same doll🌳ar amount every year thereafter for approximately 30 years.

“This is based on a 65-year-old having a portfolio that is 60% stocks and 40% bonds that gives an annual average return of about 7%,” says Adams. “If you have a $500,000 portfolio, then, per the 4% rule, you can safely🅰 withdraw about $20,000 per year.”

However, not everyone agrees that this is the perfect percentage. The 澳洲幸运5开奖号码历史查询:creator of the rule, William P. Bengen, thinks 5% could be a better rule for all, while others caution that a 3% rule might be safer. Talk to a financial advisor about your particular situation.

Beware of Sequence of Returns Risk

You may need to take smaller withdrawals during down markets to avoid a 澳洲幸运5开奖号码历史查询:sequence of returns risk. This can happen when your portfolio exper🐻iences a major loss because of a market downturn early in retirement. It can mean less moneyꦆ in your savings in future years.

“It can shrink your portfolio much faster than expected,” says , a certified financial planner and founder of Fiduciary Organization. “In down years, reducing withdrawals or tapping 澳洲幸运5开奖号码历史查询:cash reserves can help protect against this risk.”

In addition to turning to cash, to mitigate this problem, ensure your portfolio is reviewed regularly and well 澳洲幸运5开奖号码历史查询:diversified across different asset classes to 🍷reduce the impact of any single asset's performance. Your financial advisor might also suggest a phased retirement where your transition happens more gradually.

Continue Earning

Having a part-time job is a great way to supplement your income during retirement. Even a few thousand a year can make a difference and allow you to withdraw less from your 澳洲幸运5开奖号码历史查询:retirement savings.

“Working part-time in retirement can make a lot of sense for those who are concerned about spending through their portfolio before the end of their lifetime,” Adams says. “Even if you only make, say, $10,000 per year working part-time in retirement, that’s $10,000 less that you have to withdraw from your portfolio to cover your 澳洲幸运5开奖号码历史查询:cost of living, and that money can instead stay in your portfolio and cont🍬inue to grow.”

Other forms of income, such as rental income, can also help to bolster your income during retiremen🔯t.𒐪

“Part-time work, consulting, or rental income can all help stretch savings. They give retirees flexibility and reduce the pressure on their investment accounts, esp𒈔ecially in uncertain markets,” Milks says.

How to Balance Risk and Return

The risk-return tradeoff states that as risk rises, so does the potential return. You want your 澳洲幸运5开奖号码历史查询:retirement portfolio to balance risk and still give you the return that you need during y🍰our retirement years. The further away from retirement you are, the more risky you ꦑcan afford to be, but as you approach your next transition, you should consider becoming a bit more risk-averse.

“A balanced mix of equities for growth and bonds or cash for stability works well,” Milks says. “I often suggest a ‘澳洲幸运5开奖号码历史查询:bucket strategy’—short-💞term needs in cash, medi🥃um-term in bonds, and long-term growth in stocks.”

How to Handle Shortfalls

If there are shortfalls in your retireme෴nt budget, you’ll want to lo🔴ok for ways to cut expenses.

“We no🐻rmally start with small cuts, such as downgrading a TV package, changing cellphone plans, or refinancing higher-interest debt,” says , a certified financial planner and founder of WELLth Financial Planning. “Once those options are exhausted, we turn to la✱rger cuts and ask questions about downsizing or living with only one car.”

Bigger shortfalls may call for bigger actions, such as downsizing, relocating to a more cost or tax-friendly location, or turning to home equity by c🦩onsidering a reverse mortgage.

Benefits of a Financial Planner

Choosing the right 澳洲幸运5开奖号码历史查询:financial planner can help to steer your retirement plans in the right ꦫdirection.

“Working with a fiduciary, fee-only financial planner is💟 important because you get advice that’s based solely on your best interests—not on commissions or product sales. It helps you avoid emotional decisions and ensures you’re following a strategy that’s aligned with your goals,” Milks says.

Getting 𒐪a written financial plan from a financial planner is also a smart move.

“Having a formal, trackable plan makes it much ea♌sier to ad෴just course when markets shift or your life circumstances change,” Milks says.

The Bottom Line

To make 澳洲幸运5开奖号码历史查询:$500,000 last in your retirement, you’ll have to make some smart financial moves. Begin by estimating your annual expenses and income,🐼 such as money from a p🔯art-time job, Social Security benefits, and a pension.

When withdrawing money from an investm🌞ent portfolio, use the 4% rule and withdraw no 💧more than 4% of your investments in a year. In down markets, reduce the money you withdraw from investments and use your cash reserves instead. Consider part-time work to supplement your income, especially if you are experiencing a shortfall in your retirement savings.

Cutting both small and big expenses can help. For example, you may want to consider downsizing, going down to a single car, or moving to a place with a lower cost of living.