If you’re like many retirees, your 401(k) may be your single biggest retirement asset. The 401(k) plan can make for an excellent retirement savings vehicle. It offers tax-deferred growth while funds are in the account, allowing your earnings to compound quickly. Also, if your employer has a generous match, you may get the benefit of additional contributions into the plan.
As you near retirement, though, you’ll have to start thinking about your 401(k) not as an accumulation vehicle, but rather as a distribution tool. You will likely have income from Social Security and possibly even a pension in retirement, but you may also need income from your savings to fill in the gaps.
Principal of BAM Advisory Group