59 ½: The Retirement Turning Point Asset Strategy

When you turn 59 ½, there are things that begin to happen. Most importantly: you can begin withdrawing from your retirement accounts, such as 401(k)s and IRAs.[1][2] This age is also very important because it can mark a shift in your investment and retirement strategy.

Throughout your career, you are in what many refer to as the “accumulation phase” of your retirement. This is the period of your life in which you are actively contributing to your retirement plans and trying to add money to your nest egg for when you stop working.[3] When you reach 59 ½, it signifies a shift away from the saving period of retirement planning and into the spending and cost-covering period.

As such, once you hit the age where you can finally start to withdraw from your retirement accounts, you have some very important choices to make. Will you continue to work and contribute to your retirement accounts? Maybe your nest egg isn’t as big as you would like it to be, so working more and saving further is the right option for you. You might have to consider working some extra years to get yourself to where you need to be. You also may want to consider how you want your finances to be set up to preserve your savings instead of growing them. Do you want to move in a more conservative investment direction to try to maintain the wealth you’ve gained? These are important questions to ask when it comes to switching from saving for retirement to living it.

There are also many important risks that come with switching from a savings accumulation strategy to an income-generating and cost-covering one, including tax concerns that may arise when moving your savings between accounts and investments, risk tolerance, and the effect of stock market volatility. These questions are not always easy to answer without professional knowledge and guidance.

Unfortunately, there isn’t a one-size-fits-all plan for folks who are approaching 59 ½ or have already passed that very important half-birthday. Your monetary goals and your specific situation will have a lot of impact on what choices you make during that very important time. A financial advisor can help to guide you through this period by providing advice tailored to your unique financial situation. If you are interested in seeing if a financial advisor can benefit you, reach out to our professionals today for a complimentary review.


Sources:[1] https://www.investopedia.com/terms/1/401kplan.asp#toc-taking-withdrawals-from-a-401k
[2] https://www.investopedia.com/terms/i/ira.asp
[3] https://www.investopedia.com/terms/a/accumulationphase.asp

Because investor situations and objectives vary this information is not intended to indicate that an investment is appropriate for or is being recommended to any individual investor.

This is for informational purposes only, does not constitute individual investment advice, and should not be relied upon as tax or legal advice. Please consult the appropriate professional regarding your individual circumstance.

There are retirement account risks that could diminish investor returns, such as, but not limited to: low interest rates, market volatility, withdrawal timing and sequence of returns risk, government policy uncertainty and increased longevity. Prospective investors should perform their own due diligence carefully and review the “Risk Factors” section of any prospectus, private placement memorandum or offering circular before considering any investment.

Advisory Services offered through Asset Strategy Advisors, LLC (ASA), a SEC Registered Investment Advisor.  Securities offered through Concorde Investment Services, LLC. (CIS), member FINRA/SIPC. Insurance Services offered through Asset Strategy Financial Group, Inc. (ASFG)”. ASA, CIS and ASFG are separate companies.

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