Shreveport, La. — While the nation has long encouraged Americans to max out 401(k)s and other retirement accounts, turning those savings into reliable income poses challenges. Financial advisor Jean Chatzky tells retirees to begin planning now for what she calls a “forever paycheck”—a steady stream of earnings designed to last the rest of their lives.
What a “forever paycheck” means
“A paycheck that will last for the rest of their lives, no matter how long that turns out to be,” Chatzky said in a conversation with KTBS 3 anchor Shannon Brinias. The concept is to create dependable cash flow that, together with Social Security, covers essential expenses while still leaving money for the activities retirees enjoy.
Tools to create lifelong income
Chatzky outlines several strategies for building that income:
- Annuities that provide guaranteed payments.
- Investments in Treasury securities and Treasury ladders for safety and predictable returns.
- Dividend‑paying stocks that generate regular cash flow.
She also notes that health savings accounts can play a role in a broader retirement‑income plan.
Timing withdrawals wisely
One key consideration is when to take money out of retirement accounts. Required minimum distributions can push taxable income higher, potentially increasing both tax liability and Medicare premiums. Planning withdrawals to minimize these impacts is essential.
Emotional adjustment
Beyond the numbers, Chatzky emphasizes the emotional shift retirees must make. After decades of being told to save as much as possible, retirees need to become comfortable using some of those savings at the right time, striking a balance between preserving wealth and avoiding unnecessary tax costs or penalties later.
Chatzky’s new book, co‑authored with AARP, expands on these strategies and offers guidance for navigating the financial and emotional aspects of retirement.
Original reporting: KTBS 3 (Shreveport) — read the source article.
