Financial Planning

Make a Plan to Generate Income from Retirement Savings

Make a Plan to Generate Income from Retirement Savings

Odds are you’ve thought about how to diligently save for retirement. Now it’s time for a critical step: figuring out how to use that nest egg as part of an overall plan to generate the income you'll need during retirement, no matter how long that lasts.  

“In my experience, people don’t generally have a plan for generating income in retirement,” says Steve Vernon, author of Money for Life: Turn your IRA & 401k into a Lifetime Retirement Paycheck and a research fellow at the Stanford Center on Longevity. “Once they retire, they just start spending their money—and they usually spend too much.”

The good news is that a little planning goes a long way toward reaching your retirement goals. Take the following steps to help ensure you’ll be able to live comfortably in retirement without exhausting your savings.

Assess your income and expenses. Your savings probably won’t be your only source of funds during retirement. Social Security, pensions and earnings from part-time work can help cover expenses. Once you assess all your other income sources, you can make an informed decision on how much to pull from your IRA, 401(k) or other retirement savings accounts.

“Too many people do the math in their heads instead of taking the time to work it all out on paper,” Vernon says. “They approximate what they think they’ll need—and then they end up running out of money.”

Online tools, such as retirement and expense calculators, can help you get a handle on figures such as your monthly expenses, how much Social Security and other income will cover and how much you’ll need to pull from your savings.

Withdraw smartly. Your retirement nest egg may have to support you for 30 years (or longer!), so it’s important to be strategic about your withdrawals. Financial advisors commonly recommend withdrawing a maximum of 4 percent from a diversified investment portfolio each year, with adjustments for inflation. This strategy can provide you with a steady income stream in retirement and greatly reduce the risk of running through your nest egg too soon.

“Drawing down your savings to generate income can be tricky,” Vernon advises. “If you don’t feel capable of doing the calculations yourself, you can always consult a financial advisor to guide you through the process.”

Adjust your investments. “Many people think that once they retire, they need to become very conservative with their investments,” Vernon says. “But being too conservative can hurt you, too. Twenty or thirty years of inflation can do some real damage to your portfolio.”

With these factors in mind, employ a balanced investment strategy that incorporates cash, bonds stocks and, maybe, real estate. Having cash on hand provides you with ready access to money; bonds provide a measure of safety and income; and stocks allow for growth potential. Balancing all three will make sure you’re in good shape for whatever the future holds. A SunTrust advisor can help you determine if the strategy you’re following is the best for you.

For more information about retirement, investing, and financial planning, consult with a SunTrust Investment Services Financial Advisor or learn more how SunTrust can help you with your retirement and investments needs.

This content does not constitute legal, tax, accounting, financial or investment advice. You are encouraged to consult with competent legal, tax, accounting, financial or investment professionals based on your specific circumstances. We do not make any warranties as to accuracy or completeness of this information, do not endorse any third-party companies, products, or services described here, and take no liability for your use of this information.


Investment and Insurance Products:

Are Not FDIC or any other Government Agency Insured   Are Not Bank Guaranteed  May Lose Value 

© 2018 SunTrust Banks, Inc

equal housing logoSunTrust Bank is an Equal Housing Lender. Member FDIC

equal housing logoEqual Housing Lender. SunTrust Mortgage, Inc

SunTrust, SunTrust Mortgage, SunTrust PortfolioView, SunTrust Robinson Humphrey, SunTrust Premier Program, AMC Pinnacle, AMC Premier, Access 3, Signature Advantage Brokerage, Custom Choice Loan and SunTrust SummitView are federally registered service marks of SunTrust Banks, Inc. All other trademarks are the property of their respective owners.

Services provided by the following affiliates of SunTrust Banks, Inc.: Banking products and services are provided by SunTrust Bank, Member FDIC. Trust and investment management services are provided by SunTrust Bank, SunTrust Delaware Trust Company and SunTrust Banks Trust Company (Cayman) Limited. Securities, brokerage accounts and insurance (including annuities) are offered by SunTrust Investment Services, Inc., a SEC registered broker-dealer, member FINRA, SIPC, and a licensed insurance agency. Investment advisory services are offered by SunTrust Advisory Services, Inc., a SEC registered adviser. GFO Advisory Services, LLC is a SEC registered investment adviser that provides investment advisory services to a group of private investment funds and other non-investment advisory services to affiliates. Mortgage products and services are provided by SunTrust Mortgage, Inc.

SunTrust Mortgage, Inc. - NMLS #2915, 901 Semmes Avenue, Richmond, VA 23224, 1-800-634-7928. CA: licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act, IL: Illinois Residential Mortgage Licensee #MB-989, Department of Financial and Professional Regulation, 100 W. Randolph, Suite 900, Chicago, IL 60601, 1-888-473-4858, MA: Mortgage Lender license #-ML-2915, NJ: Mortgage Banker License - New Jersey Department of Banking and Insurance, NY: Licensed Mortgage Banker—NYS Department of Financial Services, and RI: Rhode Island Licensed Lender.

"SunTrust Advisors" may be officers and/or associated persons of the following affiliates of SunTrust Banks, Inc.: SunTrust Bank, our commercial bank, which provides banking, trust and asset management services; SunTrust Investment Services, Inc., a registered broker-dealer, which is a member of FINRA and SIPC, and a licensed insurance agency, and which provides securities, annuities and life insurance products; SunTrust Advisory Services, Inc., a SEC registered investment adviser which provides Investment Advisory services.

SunTrust Private Wealth Management, International Wealth Management, Business Owner Specialty Group, Sports and Entertainment Group, and Legal and Medical Specialty Groups and GenSpring are marketing names used by SunTrust Bank, SunTrust Banks Trust Company (Cayman) Limited, SunTrust Delaware Trust Company, SunTrust Investment Services, Inc., and SunTrust Advisory Services, Inc.

SunTrust Bank and its affiliates do not accept fiduciary responsibility for all banking and investment account types offered. Please consult with your SunTrust representative to determine whether SunTrust and its affiliates have agreed to accept fiduciary responsibility for your account(s) and if you have completed the documentation necessary to establish a fiduciary relationship with SunTrust Bank or an affiliate. Additional information regarding account types and important disclosures may be found at

SunTrust Robinson Humphrey is the trade name for the corporate and investment banking services of SunTrust Banks, Inc. and its subsidiaries, including SunTrust Robinson Humphrey, Inc., member FINRA and SIPC.