If you\u2019re approaching or already in retirement, you\u2019re not alone if you\u2019re wondering what to do about your nest egg investments. Should you stick with your existing position, or sell some of your investments now? Will your savings last through retirement, regardless of any other periods of market volatility?<\/p>\n
\u201cQuestions like these come up often during times of economic uncertainty,\u201d notes Rick Lowes, vice-president of retirement strategy at RBC. \u201cTo make sure your investment portfolio isn\u2019t unduly impacted, it\u2019s important to take a step back, and revisit the goals and objectives in your financial plan.\u201d<\/p>\n
Don\u2019t have a plan yet? Don\u2019t fret. This all starts with a conversation with a financial advisor around what truly matters to you and how you want to spend your time when you\u2019re retired to determine how much money you will actually need to last through retirement.<\/p>\n
A common strategy to address this uncertainty is called \u201cbucketing,\u201d Lowes adds. \u201cDividing your investments into three main time horizons or buckets can provide short-term protection during market fluctuations, generate income over the medium term and give you long-term growth to help sustain your wealth.\u201d<\/p>\n
Here\u2019s how to fill up each of your three buckets.<\/p>\n
SHORT-TERM BUCKET:<\/strong> Consists of savings and short-term investments, such as GICs and money market funds that mature between one to five years. These assets provide secure, stable income to meet your immediate basic and lifestyle needs in retirement.<\/p>\n