Retirement planning can be tricky! One way to organize your money is using a 'bucket strategy'. Think of it like having three separate containers for your retirement savings.
This strategy helps you make sure you have enough money for when you retire. It isn't about making the most money possible, but about having access to money when you need it.
It's like having a piggy bank for everyday expenses, a jar for shorter-term goals, and a bigger savings account for your long-term dreams.
- Cash Bucket: Money for the first few years of retirement. Think of it as your everyday spending money.
- Bond Bucket: Safer investments for years 3-10. Bonds are like loans you give to companies; they're less risky than stocks.
- Stock Bucket: Riskier, but potentially higher-earning investments for the long term (after year 10). Stocks are like owning a piece of a company.
| Bucket Strategy | Cash (%) | Bonds (%) | Stocks (%) |
|---|---|---|---|
| Aggressive (25+ years) | 8% (years 1-2) | 32% (years 3-10) | 60% (year 11+) |
| Moderate (15-25 years) | (Data not provided in text) | (Data not provided in text) | (Data not provided in text) |
| Conservative | (Data not provided in text) | (Data not provided in text) | (Data not provided in text) |
