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Money Management During Retirement

Learning about money management during retirement can help you to preserve the lifestyle that you are used without worrying about the future.

You have reached the finish line, but the retirement race is not over. You now need to learn how to preserve your financial assets to help you enjoy your retirement years. This is where a financial advisor can be particularly helpful with money management during retirement.

Minimize Taxes

Most retirees live on fixed incomes, which means minimizing expenses becomes a major priority.

The first expense you should target for managing is paying taxes. Retirement accounts come with different tax liabilities.

Here are a few tips for minimizing taxes during retirement:

  • Stay on top of how much you withdraw each year to avoid paying excess taxes
  • Consider converting to a Roth IRA to spread out distributions
  • Remember that mandatory retirement plan withdrawals start at age 70 1/2

Generate Retirement Income

Retirees have to walk a fine line when it comes to balancing investment risk and income. Although putting all your financial nest eggs into an international stock fund is considered too risky, trying to live off the interest produced by a CD does not cut it financially either.

Living a meaningful retirement requires you to find investment vehicles that generate enough money to ensure you achieve your financial goals. A certified financial planner can help you generate more than sufficient income as part of your money management during retirement.

Create Monthly Budgets

One of the keys to success for lowering expenses during retirement is to develop a blueprint to get where you want to go financially.

The blueprint is called a monthly budget that accounts for fixed expenses such as housing and insurance costs, as well as less frequent expenditures that include paying for a day out with your grandchildren. You establish a set of financial priorities to help you maintain financial independence.

Tap into Your Home’s Equity

For many retirees, home equity is the largest source of untapped wealth. One of the reasons why you need to decide where you want to live is not about where geographically, but whereas moving into a smaller home.

Downsizing your new home allows you to tap into the equity built in your previous home. Take the money generated by home equity and sock it away into an account that produces a steady stream of income.

Make Social Security a Waiting Game

The money received from Social Security between enrolling in the program at 62 and waiting until you turn 70 is staggering. As a guaranteed source of monthly income for the rest of your life, Social Security provides the peace-of-mind retirees need to live a robust life.

However, delaying when you start receiving Social Security is a huge part of determining financial success as part of your money management during retirement.

Prepare for Inflation

Because of the reliance on fixed income streams, retirees are the most vulnerable to inflation.

The most effective strategy to minimize the impact of inflation is knowing when to convert fixed-income assets into assets that do well during inflationary phases of the economy.

Couple sitting on a counch playing guitar during retirement.

For example, moving money out of a securities fund into a fund that concentrates on investing in precious metals helps defeat the scourge called inflation.

The Bottom Line on Money Management During Retirement

Planning for retirement as you approach it and following through with your plans requires a disciplined approach to money management during retirement.

You can reach your retirement financial goals by using one or more of the following money management tools.

  • Financial planning
  • Credit card fraud protection
  • Life insurance policy
  • Online brokerage account
  • Checking and savings accounts


When you retire, you have not reached the end of the road for managing your money. You have to reassess your financial position constantly, and then make adjustments that meet your financial needs.

Your financial priorities might have changed, or the economic climate has transformed into something quite different than it was 10 years ago.

You worked hard to save money before retirement. Make it last by staying on top of your money management during retirement.

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