Podcast Episode 281: Managing Your Largest Assets in Retirement

Most people think of their home as their largest asset. But for retirees, that may not be the case. In fact, your retirement savings may be your biggest asset. And it’s important to manage those assets carefully in order to ensure a comfortable retirement. In this blog post, we will discuss some tips for managing your retirement savings wisely.

Let’s start with the retirement savings portion of the portfolio. By the time you retire, your 401(k) will likely be the largest asset you own.  It’s important to understand how to manage this asset. First, make sure you have a diversified portfolio. This means investing in different types of stocks, bonds, and funds that can help minimize the risk of your investments while still providing a healthy return.

Another one of your largest assets will be the home that you own. Everyone knows it’s one of the most valuable pieces of your financial portfolio, but what they don’t usually know is how it factors into retirement. With the values of real estate soaring over the past two years, many people are asking us if they should sell their home and cash in. But will you be able to find another property at a good price? Probably not, especially if you are staying in the same area.

Where the home really comes into play is later on in life when you’re deciding whether to leave it to the children. If your kids aren’t going to use the home, they’ll probably end up selling it anyway so why not consider that option for yourself if that money can help you in other areas of retirement?

Another large asset for your retirement is Social Security. That might not be the first thing you think about, but it’s likely going to cover a large chunk of your retirement income so it needs to be managed properly. Social Security money also can’t be passed along so that needs to be factored in when deciding when you take your benefit, and that decision will vary for every individual.

Now our next one is a little outside of the box because it’s not an asset you’ve actually realized yet, but your future savings potential can be a huge benefit in retirement.   A lot of people forget about their future savings potential or don’t realize that it can be used to help fund retirement. So when considering assets, make sure you factor in things like additional part-time jobs and ways to generate extra income outside of your 401(k).

The final asset you’ll want to consider when building a retirement plan is the bunch of small accounts you have. When you add up these different retirement accounts and brokerage accounts, they often become one of your largest assets.  It can be tempting to leave these accounts where you have them and forget about them, but it’s important to review these accounts regularly so that you understand their performance and make sure they are performing up to your expectations.

Ultimately, managing your largest assets in retirement is all about planning for the future. Make sure you understand all of the assets you have and make sure you are making the best decisions for your retirement goals. With the right plan in place, you can have a secure retirement that will last throughout your later years.

Here’s what we discuss in this episode:

0:52 – The 401(k) account

1:55 – How the house fits into planning

3:25 – Your Social Security

5:44 – Future savings potential

7:16 – All of your smaller accounts  

9:22 – Mailbag question on 401(k) rollovers

10:46 – Mailbag question on getting married a second time

12:48 – Mailbag question on inherited IRAs

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