How the ‘Liniwe Ingo’ strategy can increase retirement income
More Americans are expected to reach retirement age this year than ever before. For many people who hit that milestone, a harsh reality can await. That’s because few people feel secure about their plans.
According to Fidelity Investments’ 2025 State of Retirement Planning survey, with two-thirds of people in their planning years feeling optimistic about their prospects, that number is seven percent lower than last year. Meanwhile, 70% of retirees say the rising cost of living has drained their money.
The acquisition of reliability is not the only indicator of times to try to retire: The latest test from 3,000 old people was found last month, and in a survey of 4,000 respondents they earn more than $26 per month, and they expect social security to be their main source of income.
Being dependent on social security benefits is a slippery slope to financial hardship. Another way to build confidence and protect against those issues is with a comprehensive retirement plan, which can include using your money as part of an income strategy that will generate recurring (and unexpected) income throughout your golden years.
What is a combined fee?
Simply put, income means having multiple sources of income to draw from during retirement.
The benefit is clear when you look at the social security benefit, which stood at about $2,000 for most of America’s Bresenditures every month, between the ages of 65 and 74, according to the Federal Reserve Economic DATE.
Building a combined income stream can help retirees fill the gap. About 60% of retirees with an income plan reported having a better lifestyle after retirement, compared to 49% of retirees with only one source of income who used Social Security, according to the 2023 Goldman Sachs Survey. Retirees using a no-income strategy also reported higher levels of satisfaction with their money.
Compounding income combines multiple sources of income that are both variable and variable to create a variety of different cash flows. Income includes fixed amounts from sources such as things like fines, bonds, pensions and variable income from your sources where your money can go, tax-funded accounts such as taxes.
Each type has its own advantages and disadvantages, according to a report from the Investment Advisory Firm Vanguard, which recommends using both variable (AKA) and variable sources for retirement generation. While income provides predictability and insulates you from market fluctuations, it also prevents you from reaching the higher returns that equity can deliver. Alternatively, income is more difficult to predict but provides a higher risk-reward ratio. Combining them allows you to reap the benefits of each while limiting the downside.
Before planning how to convert your retirement income, you first need to determine your risk tolerance. “Finding that sweet spot is the first thing we do with a client,” says Jaime Ruff, a certified financial planner and senior wealth advisor at HB Wealth. “After that we can start thinking about revenue generation.”
Understanding your risk tolerance can help you find a way to approach the potential gap between your retirement income and your potential expenses.
“We’re preparing a financial plan that looks at all sources of investment income — like a pension or social security or a post-retirement gig,” Ruff said. “After that we work on a long-term separation where you remove the costs, and there is this line, then, because it is returned to the total amount of meeting and meeting their goals.”
Once that line is determined and you know what total return is required, the next step in building an integrated retirement plan is to determine what fixed and variable income sources to include in the equation.
Retirement income
Aside from social security, retirement income is often associated with stocks, bonds and defined benefit plans (ie, pensions). It can also include other forms of money like certificates of deposit (CDs) and fun financial instruments like money-backed securities.
Actions, which have increased in popularity, are issued by contracts of insurance companies that provide a stream of income to the consumer to receive premiums. Notably, these products are not like life insurance policies that only pay benefits when the insured dies. While there are both fixed and variable annuities, fixed annuities provide a guaranteed return – for the term or the remainder of your life – and are not linked to market performance.
Funds carry high costs, however. In some cases, you will owe a premium, which can be paid as a lump sum or in cash. In addition to premiums, total commissions, expense ratios and other fees can make funds more expensive than other investments. The commission on a 10-year annuity, for example, can range from 6% to 8%, compared to 0.5% to 2% for stocks and bonds.
“I like income. I like guaranteed income,” Ruff said. “It’s just that the cost of getting an annuity is sometimes quite high.” He chooses bonds, noting that when they mature, you can decide to use the principal as income or as a return. This can be achieved through bond placement – creating a timeline with multiple bonds holding different maturity dates, allowing you to take the money as income.
Ladderling is best suited for those with a low risk tolerance. Ruff suggests the Greaterys to those who are looking for the safest money and guaranteed money, noting that “they are” in terms of the safest bond in the world “since they were issued by the Federal government. He also recommends corporate bonds, which have very low interest rates.
“Bonds are like ballast on a ship – they help keep things strong,” Ruff said. “I like to see clients who have cash and bonds available to meet their needs. So if the stock market goes down a lot, they still have a lot in their portfolio that doesn’t stop.”
Since the basic concept of an income plan is separate from your sources, combining stocks, corporate bonds and cash equivalents such as CDs can provide multiple sources of income for social security.
Retirement income
Income provides greater access to your funds than fixed income, but carries lower yields. Traditionally, sources of income include investments made through a 401(k), IRA or brokerage account. However, it can also include income generated from other assets such as real estate.
When you look at how to use the income, remember that shares (ie, shares, mutual funds and eTFS), either with the risk of tax or a regular account of traders, carry a high risk. In retirement, you should focus on wealth preservation and income preservation – NOT appreciating – as older investors have less time to recover from losses.
“A lot of people put everything in the stocks,” Ruff said. “And the risk is, at some point, the stock market is going to go down, and a lot of people are going to lose a lot of money when they do.”
That’s why experts say it’s wise to focus on conservative holdings versus growth stocks. This can be done through a combination of income generating funds such as bond funds (paying money unlike bonds that are tied until they reach maturity that are tied until they acquire stocks and shares in sectors known for slow growth and low volatility).
“Stocks with a reliable history of constant or continuous dividend payments are likely to be more attractive to consider for this purpose,” according to a report from the US bank.
However, equity carries a higher risk-reward ratio, so you’ll want to balance it with other cash flows. Banking products such as high-income savings accounts and money market accounts offer additional sources of income while providing a layer of security. APYS for those types of deposit accounts are non-fixed, but they are usually insured by the FDIC or NCUA and offer better returns than other structured deposit options like CDs.
“Once you quit your job, you don’t have any money for employment,” Ruff said. “So you need to look at security as part of your plan.”
Editor’s note: This story was originally published in March 2025. We have updated it to include current information and statistics.
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