Thinking About Retirement? The Basics of Financial Literacy Are Your North Star Lake Point Advisory Group Mercer Advisors

Working towards retirement, you may have a detailed plan on how to manage your finances so that you have enough saved by the time you leave the workforce. With no external income coming in, there will be a new rulebook on how to manage your retirement earnings, expenses, and investments – not just so that you can keep growing your portfolio – but so you can live comfortably. Financial literacy in retirement is therefore crucial to achieving the retirement you dream of and can be understood through the following basics.


In retirement, you start to pay yourself with money you earned and have invested throughout your career. This money may come from employer-sponsored retirement accounts, individual retirement accounts, and Social Security. It’s essential to understand your sources of income, how much is in them, how much you’ll be getting from them, and the best times to access each. For example, you are eligible for Social Security from age 62, but experts suggest waiting until age 70 as benefits will be higher due to delayed monthly credits.[1]

The trick is that how much you choose to earn is up to you, but it is recommended that you shoot to earn 80% of your previous income[2] by utilizing multiple income sources. You should also look out for how this new income is taxed and how your sources of income are affected by unforeseen taxes in retirement. Overall, the timeline for when to utilize the different sources of income you have will require a comprehensive plan based on your financial situation, assets, and goals.


Believe it or not, spending wisely is the key to retirement longevity. Your spending is dependent on your lifestyle relative to your earnings. If you opt for a similar lifestyle to that of your workforce days, you can predict how much you’ll be spending in your day-to-day life. However, in retirement, there may be new additions like hobbies and habits that should be financed, big purchases like homes and cars, and major financial decisions like relocating or traveling regularly.

You may also have home mortgages and car loans to pay off or an obligation to financially support your kids’ and grandkids’ education. All these costs need to be factored in when thinking about spending. Then, the most under-planned costs in retirement are healthcare and long-term care. You can only receive Medicare from age 65, and that will not include long-term care. In addition, Part B, which covers your regular doctor visits, for example, is not free! Therefore, when thinking about expenses in retirement, it’s beneficial to prioritize your health and long-term care as early as possible.

Understanding earning and spending in retirement are the first steps to financial literacy, empowering you to take control of your future. To further gain insight into your finances in retirement, Click HERE to sign up for a complimentary review with us at LakePoint Advisory Group.



Lake Point Advisory Group is a tradename. All services provided by Lake Point Advisory Group investment professionals are provided in their individual capacities as investment adviser representatives of Mercer Global Advisors Inc. (“Mercer Advisors”), an SEC-registered investment adviser principally located in Denver, Colorado, with various branch offices throughout the United States doing business under different tradenames ,including Lake Point Advisory Group.

This material is provided for informational purposes and is not an offer to sell or a solicitation of an offer to buy an interest in any security or to engage in any investment strategy. Such an offer may only be made at the time a qualified offeree receives a confidential private offering memorandum or other appropriate disclosure. This report is intended as a summary; it does not purport to be complete. Information contained herein is believed to be accurate and/or derived from sources which we believe to be reliable; however we do not warrant the completeness or accuracy of such information. Opinions expressed herein do not necessarily reflect those of Lake Point or Mercer Advisors. You should not construe this presentation or any other communication received in connection with Lake Point as legal, accounting, tax, investment, or other advice. You should consult with your own counsel and advisors regarding such matters. Past performance is not necessarily indicative of future results. No representation is made that any investment will or is likely to achieve the same or similar results in the future. Investments cannot be made in an index. Alternative investments are subject to greater risks than those associated with traditional investments and are not suitable for all investors.