Your portfolio is diversified. You hope your risk is under control. But do you know how much income you really can take each year and not run out?
Decades ago, retirement was fairly predictable: Social Security and a pension provided much of your income, you moved to the Sun Belt, played tennis or golf, and you lived to age 70 or 75. Those days are gone; today's retirees must now assume greater degrees of financial self-reliance.
There is no private-pension safety net today. At one time when Social Security was paired with a pension from a lifelong employer, a retiree could potentially enjoy a middle-class lifestyle. In 2016, the highest possible montly benefit for someone retiring at Social Security's full retirement age is $2,787, or $33,453 a year. That surely won't afford you the same lifestyle you had when you were working. The cold hard truth is that we must supplement Social Security with other income streams of sources if we want to maintain or standard of living.