A popular saying goes, ‘In retirement – Goodbye tension, hello pension.” However, this may be attributed to the yester years. This statement in today’s time is quite the opposite.

Many of us have grown up seeing our grandparents and grand uncles enjoying their retirement life. Their savings, pension and investments all come through during this time and provide the necessary financial support required. In the true sense of the word, retirement is the time to start enjoying all those things that you didn’t have time to do while you worked.

But times are changing. Today it is quite impossible to be assured of a retirement where there is full proof financial backing. There are a few reasons for this. First of all, due to rising inflation, your purchasing power may not be equivalent to the absolute amount you have saved. Earlier, pensions plan were well defined by the employers, however this has changed now. According to 401(K) plans, it is the responsibility of the individual to plan his or her own retirement.

Also, the age limit to withdraw from Social Security may well rise further. This is the most significant area on which Americans depend after retirement. However, it is difficult to now start judging as to when to start withdrawing from Social Security. You do not want to reach a stage when you run out of your savings.

So the next big question is what should one do? How can one secure the retirement savings in these turbulent times?

The basic answer is try and be sensible about your savings. Make sure you are aware of the current financial situation. Do not retire too soon assuming that your savings are enough without considering your expenses. Also, you have to keep in mind the current value of the dollar and how much can you actually purchase using it.

Divide investments amongst different bonds and CDs that mature at different times. For example, invest in a bond that matures after three years, and then in another that matures after five years and so on. This way you will be assured of a steady flow of income at regular intervals.

Another tool that is gaining importance for those planning on retirement is investing in annuities. The annuities that offer life time income benefits are most popular. You can start with the life time income benefit annuity as early as when you are fifty years old. The annuity ensures that you have a steady flow of income even if the market forces deplete your principal amount.

The one thing that is clear to all Americans is that they have to be more innovative with their retirement plans. There are a lot of factors that make it difficult to envisage a financially stable retirement. However, there are also other alternatives, which adopted can be helpful. Americans should try and adopt these methods, so that, at least, we can alter the saying to, “In retirement- Goodbye tension.”