How Do I Generate Retirement Income from my Investments?
Retirement Income - Planning with Purpose
Integrating Needs, Goals, and Financial Clarity
Why Retirement Income Planning Matters
Retirement is not merely a financial milestone—it’s a turning point. At Kastler Financial Planning, we believe retirement income planning is more than math; it’s about aligning your resources with your values, ensuring that your income supports not just your lifestyle, but your purpose.
Without a clear income strategy, retirees risk uncertainty, stress, and missed opportunities. Inflation, market volatility, and longevity all challenge traditional retirement models. That’s why we anchor our planning in the Purposeful Retirement™ framework—bringing together your values with spiritual, relational, and financial wisdom to guide every decision.
Without a clear income strategy, retirees risk uncertainty, stress, and missed opportunities. Inflation, market volatility, and longevity all challenge traditional retirement models. That’s why we anchor our planning in the Purposeful Retirement™ framework—bringing together your values with spiritual, relational, and financial wisdom to guide every decision.
Typical Retirement Income Streams
Retirement income often comes from a variety of sources, each with its own timing, tax treatment, and reliability. Understanding these streams is foundational to building a Purposeful Portfolio™ that supports your retirement lifestyle and legacy.
1. Social Security
For most Americans, Social Security is the bedrock of retirement income. Timing matters—claiming early reduces monthly benefits, while delaying can significantly increase them. We help clients evaluate claiming strategies considering longevity, spousal benefits, and tax implications.
2. Pensions
Though less common today, pensions offer guaranteed income. We assess payout options (single life vs. joint survivor options), integration with other income sources, and potential lump-sum alternatives.
3. Annuities
Annuities can provide predictable income, especially in volatile markets. We explore fixed, indexed, and immediate annuities as part of a broader income strategy—always ensuring they align with your values and liquidity needs.
4. Rental and Business Income
Real estate and small business ventures can offer ongoing income and legacy impact. We help clients evaluate sustainability, succession planning, and tax efficiency.
5. Part-Time Work or Consulting
For some, retirement includes meaningful work. Whether it’s ministry, mentoring, or consulting, we integrate earned income into your overall plan—balancing purpose with tax-smart strategies.
6. Investment Income
Dividends, interest, and systematic withdrawals from brokerage accounts or IRAs can supplement income. At the heart of our retirement income planning is the Purposeful Portfolios™ framework—a trademarked approach that blends technical rigor with your Purposeful Retirement™ and legacy values.
Understanding Your Lifestyle Requirements
Retirement income planning begins with clarity. What does your lifestyle cost? What are your fixed and discretionary expenses? What legacy goals do you want to fund?
We guide clients through a detailed budgeting process, often using our Planning software to visualize monthly needs across categories like:
We guide clients through a detailed budgeting process, often using our Planning software to visualize monthly needs across categories like:
- Housing, food, and utilities
- Healthcare and insurance
- Travel and leisure
- Giving and charitable commitments
- Family support and legacy gifting
Once your spending is clear, we calculate your income gap—the difference between guaranteed income (Social Security, pensions, annuities) and your monthly spending needs. This gap becomes the target for your portfolio drawdown strategy.
Income Streams - Lifestyle Requirements = 'Gap'
Filling the Gap: Core Portfolio + Cash Bucket Strategy
Core Portfolio
We design a Core + Cash Bucket portfolio to support your cash flow needs and goals as well as reflect your values and passions throughout retirement. Your Core portfolio is designed for long-term growth and stability. It typically includes:
- Broad-market, low-cost ETFs and Mutual Funds
- Inflation-hedging assets like real estate and TIPS
This portfolio is rebalanced regularly and built to support withdrawals over the course of your retirement time horizon. It reflects your needs, goals, and risk tolerance. For more information, see our:
Purposeful Portfolios™Cash Bucket
If you have short-term income needs, we establish a Cash Bucket—typically 12–24 months of expenses held in high-yield savings, money markets, or short-term bond ETFs. This bucket provides peace of mind and protects your Core Portfolio from forced sales during market downturns.
Each month, income is drawn from the Cash Bucket to meet your gap. Periodically, we refill the bucket from the Core Portfolio—ideally during market highs or after dividend distributions. This two-tiered strategy supports:
Each month, income is drawn from the Cash Bucket to meet your gap. Periodically, we refill the bucket from the Core Portfolio—ideally during market highs or after dividend distributions. This two-tiered strategy supports:
- Liquidity for monthly needs
- Growth for long-term sustainability
- Flexibility to adapt to changing life circumstances
Want to Understand Your 'Gap'?
Contact Us TodayIf you believe you could benefit from Retirement Income Planning methodology, let’s review yours goals to see if you’re a good match for our practice or if you have any questions you can ask here!