If you are a few decades away from retirement, now is the time to evaluate your current savings strategy and to evaluate the need to make any adjustment. Investments can serve as an important source of income in retirement especially when retirees can tap into investments that pay dividends.
The primary purpose of using dividends is that you can get a source of income without having to reduce the balance of the account or withdraw from the account. You may shift from a growth oriented investment approach to investing for income as you get closer to retirement and you won’t need to devote your complete portfolio to this kind of investment. But it’s a good opportunity to reevaluate where you’re at and how close you are to where you want to go.
Most retirees benefit from having income producing assets to support pension payment, social security and other sources of income. There are many different ways to develop income producing assets but these can include:
- Dividend stocks
- Rental property investments
- Real estate crowdfunding
- Private equity
- Passive income streams developed as a business
The more you think through all of these options the better you can provide a cushion for the most important years of your retirement. Passive income streams can be an excellent source of money for retirees but many of these need to be started years in advance of your actual retirement amount to support you, such as creating an online business. For more information about how all of these different streams of income can come together in retirement and how this can affect your personal savings plan as well as your legacy, set up a time to meet with a lawyer.