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After decades of building a solid nest egg, retirement is finally the time to crack it.
But many retirees who have been good at saving aren’t sure how to spend their savings.
Recently, Investment Company Research Institute Survey of over 9,000 adults Learn more about the features and activities of IRA account holders.
As part of the study, the ICI looked at how retiree households (defined as households where the head of the household or spouse has retired from their lifelong career) are using funds drawn from traditional IRAs.
Below are their answers.
1. Reinvest or save in another account
Retiree households using traditional IRA withdrawals for this purpose: 44%
If you’ve spent years saving and saving for retirement, it can be hard to stop. Perhaps that’s why so many people who withdrew money from the IRA put the cash back into work so quickly.
If you’re one of these super cautious people, check out 8 Mistakes That Will Stop Your Retirement.
2. living expenses payment
Retiree households using traditional IRA withdrawals for this purpose: 37%
The whole point of building a nest egg is to make sure you have enough money to pay your retirement bills. payment.
3. buy, repair, or remodel a home
Retirement households using traditional IRA withdrawals for this purpose: 15%
Retirees often tap IRAs to furnish their humble homes.
This may sound surprising, but it shouldn’t be. As we reported in 12 Hard Truths About Retirement, housing is the biggest expense most people face in their golden years.
Other purposes of withdrawal
According to ICI research, other common reasons retirees use an IRA are:
- Other purposes: 12%
- Spent money on cars, boats, big-ticket items other than home: 6%
- Used in an emergency: 5%
- Spent on medical expenses: 4%
- Education fee: 1%