Worried About Your Retirement Income? Four Questions to Ask Yourself, From a Financial Planner

If you're nearing or in retirement and stressing about your retirement income (so many of us are), consider taking some time to think about these four issues.

By Tony Drake, CFP®, Investment Advisor Representative

published 19 July 2025

in Features

An older man looks up toward a sticky note stuck to his forehead.

(Image credit: Getty Images)

The past few months have been nerve-racking for investors, and while the impacts of a volatile stock market are far-ranging, those who are retired or nearing retirement are feeling it more than most.

The markets might look pretty good at the moment, but things could change in a heartbeat, which can make anyone feel uneasy. Despite that feeling, it's important to resist the urge to make any knee-jerk reactions.

If you are one of the many worried about current or future retirement income, here are four questions you should ask yourself when coming up with a plan.

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1. How much can I spend?

Have you taken a close look at your portfolio to determine how much you can withdraw each year?

If you haven't, you should. You want to run the numbers so you are confident that your money will last throughout a long retirement.

A rule of thumb that many advisers recommend for the first year of retirement is the 4% rule. This rule states that during your first year of retirement, you withdraw 4% from your portfolio and adjust the amount as needed in the following years.

While this may be a popular rule, it may not be the best for your situation. This is simply a general guideline — it's not personalized or specific.

If you're worried about how and when to withdraw from your portfolio, the best thing to do is work with a financial adviser who can assess your individual situation and come up with a spending plan that meets your needs.

They can help map out plans for your investments and withdrawals to give you confidence that you won't run out of money in retirement.

2. How can I add to an emergency fund?

It's essential that everyone, not just retirees, has an emergency fund. It is highly recommended that you have at least six months' worth of expenses set aside for emergencies.

You should be able to cover your mortgage, bills and any other expenses that pop up during that time.

Based on the average household's monthly expenses today, six months' worth would be about $35,000.

Between saving for your retirement and trying to set money aside, you may feel like you can't afford to contribute to an emergency fund.

However, making your savings and emergency funds a priority is worth it. Make sure that these accounts are easily accessible and are not tied up in the markets.

If you struggle to find room in your budget to set aside savings, start tracking how much you spend and on what. This will give you a good picture of where you can adjust or cut back.

What are your essentials, and what are your wants? You might not be able to change the amount you spend on your mortgage each month, but what about how much you spend on going out to eat?

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Put the money you save from cutting back on any wants toward your savings.

If you're struggling, start small. It doesn't matter if you're adding $10 or $100 at a time — it will make a difference.

3. Do I need to reassess my investment plan?

While there is no simple answer as to whether you should reevaluate your portfolios during times of market volatility, there are considerations to help make your decision easier.

When the market took a dive in March and April, many people felt panic and wanted to make moves with their portfolios. Taking any action without assessment first isn't generally a good idea — you don't want to panic sell or buy.

Whatever you decide to do depends on where you are in your savings journey. Are you close to retirement or just getting started?

If you are nearing retirement, it's important to evaluate your portfolio to make sure your risk isn't too high. If it is, you may want to make changes.

If you are in retirement and already withdrawing from your retirement accounts, a large drop in your portfolio could cause cash flow issues.

If you are still years out from retirement, you have plenty of time to withstand any market fluctuations.

4. Should I explore investment options outside of the market?

With the current state of our economy, you may want to look into alternative investments that are not tied to the stock market.

Consider investing in a wide range of asset classes. This could be anything from real estate and certificates of deposit (CDs) to savings bonds and gold. Doing this will further diversify your portfolio.

It can also be helpful to spread your stocks over multiple industries, from health care and technology to energy and consumer staples.

You want to avoid putting all your eggs in one basket, because this can expose you to unnecessary risk if the assets you choose experience major drops.

No one knows exactly what the future holds for the market, but having a solid financial plan can help reduce our stress.

It's important to sit down with a financial adviser who can answer important questions you may have about your future.

Drake & Associates is an independent investment advisory firm registered with the U.S. Securities & Exchange Commission. This is prepared for informational purposes only. It does not address specific investment objectives, or the financial situation and the particular needs of any person who may view this report. Neither the information nor any opinion expressed it so be construed as solicitation to buy or sell a security of personalized investment, tax, or legal advice. The information cited is believed to be from reliable sources, Drake & Associates assumes no obligation to update this information, or to advise on further development relating to it. Past performance is not indicative of future results. Registration as an investment adviser does not imply a certain level of skill or training.

Disclaimer

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

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Tony Drake is a CERTIFIED FINANCIAL PLANNER™ and the founder and CEO of Drake & Associates in Waukesha, Wis. Tony is an Investment Adviser Representative and has helped clients prepare for retirement for more than a decade. He hosts The Retirement Ready Radio Show on WTMJ Radio each week and is featured regularly on TV stations in Milwaukee. Tony is passionate about building strong relationships with his clients so he can help them build a strong plan for their retirement.