Preserving Your Nest Egg in 7 Effective Ways

Hi. I’m Connie. As a serial “Grandmapreneur®”, I speak to retirees or soon-to-be retirees on the benefits of pursuing entrepreneurship in retirement. This blog post will help you preserve your nest egg, which you will need as you consider starting a business.

7 Ways to Preserve Your Nest Egg

In an era of high inflation, rising interest rates, and a decreasing social security reserve, retirees have every reason to be concerned about making their investments last. As a result, the average retiree experiences pressure to save enough throughout their lifetime.

Fortunately, you can preserve your nest egg to achieve a comfortable life in your golden years. Here’s how to preserve your nest egg:

1. Stick to your retirement goals.

Even if it means not paying off your student debts early, you should start saving in your 20s to take advantage of the power of compound interest and company matching with 401(k) retirement plans. You should also factor in your retirement age while calculating your financial goals.

2. Apply for your employer’s savings plans.

Employer-based retirement savings plans, such as 401(k), 403(b), and others, are excellent ways to preserve your nest egg. Look into your employer’s matching funds to help triple your retirement savings at a minimal expense.

Employer-sponsored plans have automatic pre-tax savings, investment resources, and other tools.

3. Delay filing for social security.

It doesn’t mean you should wait until you turn 70 to file when your benefit is the largest.

However, it implies deferring retirement until full retirement age (FRA), which is now 67 for anyone born in 1960 or after.

Claiming before 67 costs 6.67% per year for the first three years. It costs another 5% per year for the next two, for a total savings of up to 30%.

4. Take advantage of single-premium annuities.

SPIAs (single premium annuities) allow you to annuitize a portion of your assets to produce income and lessen the likelihood of having to draw on your portfolio once the market falls.

Fees are usually lower than with some of the more sophisticated annuity programs. However, you should anticipate spending between 1% and 3% per year for the security that comes with annuitization.

5. Make the most out of your IRAs.

Traditional and Roth IRAs (individual retirement accounts) can be beneficial even if you have an employer-based plan.

IRAs provide access to a broader range of investments and the chance to save more for retirement. Because of the differences in tax status, many financial consultants advise their customers to have both forms of IRAs.

6. Use an income buffer.

Consider expanding your income as you approach retirement. Doing so creates a buffer against market changes and emergency expenses.

It could involve purchasing an income property, opening additional investment accounts, starting a small business, or working part-time. Moreover, you should look into your options and begin making plans before retirement.

7. Start a part-time business or job.

Even small sums of income might go a long way toward protecting your investments.

Downsizing to accommodate unpredictable market swings can help, but earning more money puts your power back in your hands.

The best way to earn more during retirement? Becoming a second-act entrepreneur.

Conclusion

After a lifetime of hard work, retirement is a time to unwind and enjoy your passions, family, and friends, not stress and uncertainty.

Using ways to preserve your nest egg, like investing in IRAs and preparing for crucial costs before retiring, can help you secure your golden years by staying focused on your retirement goals.

But there’s nothing more fulfilling than chasing your dreams, even during retirement. Trust me, I know! I pursued my dream of being an entrepreneur when I retired.

Do you want to be a second-act entrepreneur? My book might just be the answer. It’ll show you that it’s never too late to start your dream business. Check it out now!