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What's In Your Buckets?
talessi@ariesfoundation.org
The 3 Functions of Your Money in Retirement
What's In Your Buckets?
When you are in retirement there are only three (3) things that your money is there to do;
- Generate Income
- Provide Liquidity
- Leave A Legacy
Which is where the buckets come in
(Author's Note: My visual has always been buckets, some people like bags, or pools, but mine has always been buckets)
In getting prepared for retirement you need to be segmenting, or planning to segment, your assets to address each of the 3 concerns separately:
Income
fills the tank and make the car run
Liquidity
needs to be on-hand in case something goes wrong or breaks down
And what are you leaving behind for a Legacy: a collectible or a clunker?
Now there is a 4th bucket to Consider
As I mentioned in my previous post, "Speedbumps", the pothole that eveyone chooses to ignore is Assisted or Skilled Nursing Care in Retirement.
If you haven't planned or set aside funds in a separate bucket to handle this contingency, then which of your other buckets are you willing to sacrifice to take care of this expense?
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Completing these financial tasks before year-end can help set you up for financial success in the New Year.
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