Use these tips to help ensure you don’t outlive your assets

Having enough money to fund a long retirement period takes planning, and that planning should begin decades before the day you stop working. Cherry Shaw, Regions Vice President and Wealth Advisor in Birmingham, Alabama, provides a few ways to help ensure you don’t outlive your savings.

• Determine your ideal annual income. Some women expect to live on 80 percent of their current income throughout retirement, since the mortgage may be paid off and the kids may be out of the house. But consider whether you want to travel or pursue a new interest, because those costs may require you to maintain your current income.
• Maximize contributions to your retirement savings. Each year, you can contribute up to $19,500 to your 401(k) or 403(b) if you’re 49 or under, and $26,000 if you’re 50 or older. For an IRA, you can contribute $5,500 if you’re under 49 and $6,500 if you’re 50 or older.
• Diversify your investment portfolio. Some employers match your contributions to your 401(k) with company stock, but you may not want to put all your eggs in that one basket. Consider distributing your investments across several sectors and asset classes. Sectors are groupings of businesses that share similar products or services. Examples are utilities, consumer goods, manufacturing. Asset classes are: equities (stocks), bonds and cash equivalents (such as bank certificates of deposit, money market funds, Treasury bills).
• Consider your legacy. Your financial plan will differ depending on whether you want to use all your assets or leave some for your children or grandchildren..
• Think about potential medical expenses. Consider both you and your family. Do you, your spouse, your parents, or your kids have any medical needs that may require major expenditures in the future? Learn about long-term care insurance as an option.
• Work with a financial advisor. Everyone’s situation is different, so a financial advisor will examine factors such as assets, cash flow, and investment risk tolerance to develop a strategy to help you reach your financial goals.