Life Stage: Retirement

Once you have retired, your financial focus is likely to shift from asset growth to asset preservation. When you are no longer receiving a paycheck (or perhaps are working part time), you need to make your savings and investments last, to meet living expenses not covered by Social Security and/or pension benefits.

Know the impact of taxes on your distributions

You worked hard to accumulate savings, so you will want to keep as much of that money as you can. Consider the impact of taxes when evaluating your options for withdrawing money from your retirement accounts, including how withdrawals plus your Social Security and/or pension benefits affect your tax bracket.

Homestead Funds does not offer legal or tax advice. Please consult the appropriate professional regarding your individual circumstance.

Understand withdrawal requirements

With most retirement accounts, you must start taking withdrawals the year you turn 70½.  Some types of accounts have annual minimum distribution requirements; others allow you to choose when and how much to withdraw. You’ll need to know the requirements for your 401(k) and/or IRAs (traditional and Roth IRAs).

Confirm your beneficiaries

It’s a good idea to review the beneficiaries named on your retirement accounts (and all of your accounts), as family situations change through marriage, divorce, births and deaths. It’s easy to confirm the beneficiaries of your Homestead Funds IRA account. Just log in to your account.

Define Your Priorities

In retirement, your primary focus is likely to be preserving the value of your assets, rather than fueling account growth. You may also be in a position to consider how you can use your assets to support family and causes you care about.

Consider systematic redemptions

Homestead Funds offers a service that automatically moves money from your Homestead Funds account to your bank account. This provides a convenient way for you to receive income during retirement, so you don’t have to remember to make withdrawals.

Review your investment mix

You might have a long retirement, so consider keeping a slice of your portfolio in long-term investments, such as stock funds. These investments have the potential to generate stronger long-term returns. Money needed to meet near-term expenses should be invested in funds suitable for a short time frame.

Giving to others

Many retirees look for ways to use their assets to celebrate the people and causes that matter to them. That might involve giving to family members, covering educational expenses for grandchildren or supporting charities.


Use the right Homestead account

When you open an account with Homestead Funds, you’ll have a lot of choices: individual and joint accounts, taxable and tax-free, and qualified accounts designed for specific purposes such as retirement. We can help you determine the right type of account to use to meet your goals and your family situation.