Longer retirements mean inflation can put a serious dent in even the best-laid plans. You need an income strategy to help keep up with rising prices.
While there are many potential risks to consider when planning for retirement, one that is often overlooked is inflation. Most people factor in inflation when planning how much they will need when they reach retirement. But inflation does not stop the day you retire. In fact, your budget on the day you retire could look very different five, 10 or 20 years into retirement. Not understanding inflation — and more importantly — not having a plan to address it, can derail even the most well-planned retirement strategies.