With stagnant incomes and roller-coaster investment returns over the past decade, individuals on the brink of retirement might wonder what became of all those “rules of thumb” affecting how they handle their nest egg once they walk away from their jobs.

They’re still there. But the question of how well they work comes down to the individual.

Chief among them is the “Four Percent Drawdown Rule” first revealed by CERTIFIED FINANCIAL PLANNER™ professional William Bengen in the October 1994 issue of the Financial Planning Association’s Journal of Financial Planning. Bengen wrote that retirees who took out no more than 4.2 percent of their mostly stock-based portfolio in the initial year and adjusted their remaining portfolio toward a 60/40 split in stocks and bonds each year, that money could last an average of 30 years. That approach made Bengen’s work a gospel in the financial planning industry. (more…)

Last October, the MetLife Mature Market Institute released a study that said the over-55 workforce will account for almost 93 percent of the net increase in the U.S. civilian labor force between 2006 and 2016. At the same time, MetLife reported that many American workers plan to stay on the job “at least” until age 69.

The Pew Research Center’s Social & Demographic Trends Project echoed those findings in May 2009, saying that just over half of all working adults aged 50-65 plan to delay their retirement, with 16 percent saying they never plan to stop working. (more…)

Author: Alena Smith

Many retirees are living healthier, longer lives, and that means retirement isn’t quite what it used to be. Retirement has long been defined as an end of an era; a closing chapter in one’s life. But today’s retirees are more active and seeking to redefine retirement as the start of a new chapter – the beginning of the rest of their lives. Today’s generation of baby-boomers is not only finding the time to pursue their dream jobs in retirement, but have found that they can continue to make a good amount of retirement income in doing so. This is one of the top tips when it comes to earning income for retirement; follow your dreams. (more…)