How much income do you need in retirement? Most people plan on spending about 4% of their portfolio assets each year, and most don’t realize that the 4% will be mostly created by selling securities. This is an excellent plan with a deeply flawed implementation strategy.

Recent discussions in my Facebook groups and in private conversations with investment friends and clients, point out a simple relationship that, apparently, not all income focused investors fully appreciate. If you want FIRE, you need to understand income securities.

First off, what’s an income focused investor? With the exception of forward-thinking younger people, that would be anyone living off a portion of the income produced by their investment portfolios and/or anyone who is spending any of the “market value returns” from their portfolios (without realizing that it is depleting principal).

But before picking up the phone to speak with your advisor about becoming more income focused, let’s make sure that you know what it’s all about. What changes are necessary, in both security selection and performance expectations? What risks are reduced, and which ones are increased? What yields can be obtained safely?

Finally, make sure you fully understand why I chose this particular image for this post, and that safe income programs generating between 8% and 10% annually are relatively easy to construct..

The reason that you haven't heard from me in months is that I've been in the process of writing a new book Retirement Money Secrets, I've also retired and am starting an income Coach business. So very, very, busy.

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