- Home
- Retirement
- Retirement Planning
The most resilient income plans layer multiple sources of predictable income and growth-oriented assets to help ensure immediate cash flow and long-term flexibility.
By
Jeff Judge, CFP®, ChFC®, CLU®, AEP®
published
8 March 2026
in Features
When you purchase through links on our site, we may earn an affiliate commission. Here’s how it works.
- Copy link
- X
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.
Contact me with news and offers from other Future brands Receive email from us on behalf of our trusted partners or sponsors By submitting your information you agree to the Terms & Conditions and Privacy Policy and are aged 16 or over.You are now subscribed
Your newsletter sign-up was successful
Want to add more newsletters?
Delivered daily
Kiplinger Today
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more delivered daily. Smart money moves start here.
Signup +
Sent five days a week
Kiplinger A Step Ahead
Get practical help to make better financial decisions in your everyday life, from spending to savings on top deals.
Signup +
Delivered daily
Kiplinger Closing Bell
Get today's biggest financial and investing headlines delivered to your inbox every day the U.S. stock market is open.
Signup +
Sent twice a week
Kiplinger Adviser Intel
Financial pros across the country share best practices and fresh tactics to preserve and grow your wealth.
Signup +
Delivered weekly
Kiplinger Tax Tips
Trim your federal and state tax bills with practical tax-planning and tax-cutting strategies.
Signup +
Sent twice a week
Kiplinger Retirement Tips
Your twice-a-week guide to planning and enjoying a financially secure and richly rewarding retirement
Signup +
Sent bimonthly.
Kiplinger Adviser Angle
Insights for advisers, wealth managers and other financial professionals.
Signup +
Sent twice a week
Kiplinger Investing Weekly
Your twice-a-week roundup of promising stocks, funds, companies and industries you should consider, ones you should avoid, and why.
Signup +
Sent weekly for six weeks
Kiplinger Invest for Retirement
Your step-by-step six-part series on how to invest for retirement, from devising a successful strategy to exactly which investments to choose.
Signup + An account already exists for this email address, please log in. Subscribe to our newsletter
One of retirement's biggest psychological challenges is replacing a predictable paycheck with income drawn from investments that rise and fall.
According to research from the Stanford Center on Longevity, retirees generally prefer predictable income to flexible lump sums.
The usual answers for income certainty — such as bonds, CDs and annuities —come with tradeoffs.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
CLICK FOR FREE ISSUE
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Sign up- Lock in too much guaranteed income at today's rates and inflation can erode purchasing power
- Avoid volatility entirely, and it's harder to keep pace with rising costs over a multidecade retirement
The goal is not to choose safety or growth. The goal is a strategy that produces reliable cash flow now while staying flexible later.
About Adviser Intel
The author of this article is a participant in Kiplinger's Adviser Intel program, a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.
1. Build a tiered bond ladder
A bond ladder can create predictable income because each rung has a known maturity date. You buy individual bonds, such as Treasuries, municipal bonds or high-quality corporate bonds, with staggered maturities.
Example: Hold bonds maturing in one, three, five, seven and 10 years. When a bond matures, you can use the principal for spending or reinvest it into a new 10-year bond to extend the ladder. This spreads interest rate risk across time.
One advantage over bond funds is that individual bonds have a maturity date. Bond funds don't mature, so their price can drop when rates rise. With a ladder, you know when principal is scheduled to return, assuming no default.
For higher tax brackets, municipal bonds might be attractive because interest is generally exempt from federal income tax, and might be exempt from state income tax when the bonds are issued in your state.
2. Create a Social Security bridge with short-term investments
Delaying Social Security can materially increase lifetime guaranteed income. Each year you delay past full retirement age increases benefits by about 8%. Waiting from age 62 to 70 can raise the benefit significantly.
The practical issue is funding the gap between retirement and when you claim. A Social Security bridge sets aside several years of spending in low-risk, short-term instruments that mature in sequence, such as Treasury bills, CDs or short-term bonds.
If you retire at 65 and plan to claim at 70, estimate the annual income you need after any pension or other guaranteed income. Then earmark five years of that gap in a dedicated account with maturities aligned to each year.
This turns the delay decision into a more conservative move. You aren't forced to sell stocks in a down market to cover the gap, and you're effectively buying more inflation-adjusted lifetime income through Social Security.
3. Use a strategic dividend stock allocation
Dividend-focused stocks and funds can provide an income stream with long-term growth potential. According to research from Hartford Funds, dividend-paying stocks have historically shown lower volatility and higher total returns than nondividend payers.
A practical approach is to allocate a portion of the portfolio to diversified dividend focused funds or a broad set of high-quality companies with consistent dividend histories. The income comes from the dividends, and the underlying holdings can provide growth over time.
Two factors matter:
- Dividends can be reduced, so diversification is essential
- Dividend income should not be the only income source
If the dividends are qualified, they might receive favorable tax treatment compared with ordinary income.
4. Use target date funds in reverse
Target-date funds are designed to shift from stocks toward bonds as the target year approaches. Retirees can use that design to create time segmented spending buckets.
Instead of owning one target date fund, consider holding several with staggered dates. A near-date fund is typically more conservative and can support near-term withdrawals. A later-date fund typically holds more equities and can support longer-term growth.
A disciplined withdrawal plan might spend from the most conservative fund first while letting the longer-dated funds compound. This can create a simple, rules-based glide path without constant rebalancing decisions.
Limitations include less customization and ongoing fund expenses, but the simplicity might be worth it for some retirees.
Looking for expert tips to grow and preserve your wealth? Sign up for Adviser Intel, our free, twice-weekly newsletter.
5. Implement a percentage withdrawal with guardrails
Fixed withdrawal rules can be too rigid. A dynamic approach uses a starting withdrawal rate, then adjusts spending when the portfolio moves outside pre-set boundaries.
One example is a guardrail framework. If the portfolio performs well and the withdrawal rate drops below a lower threshold, spending can increase modestly. If markets decline and the withdrawal rate rises above an upper threshold, spending is temporarily reduced.
Research summarized by financial planner Jonathan Guyton suggests this type of approach can improve sustainability vs a fixed rule because it responds to market conditions.
The key is that the rules are set in advance. That helps reduce emotional decision-making during volatility.
Putting it together: Reliability without giving up flexibility
The most resilient income plans layer multiple sources.
- Social Security forms an inflation-adjusted foundation
- A bond ladder supports predictable cash flow for scheduled needs
- Dividend-focused equities can provide income growth potential
- A guardrail-withdrawal plan adds flexibility
- Cash reserves can buffer near-term volatility
This creates a practical balance. Essential expenses can be supported by more predictable sources, while growth assets remain available for discretionary spending and longer retirement horizons.
Related Content
- How to Master the Retirement Income Trinity: Cash Flow, Longevity Risk and Tax Efficiency
- The 'Rule of 25' for Retirement Planning
- How Much Do I Need to Retire? A Financial Professional Breaks Down Your Options
- 7 Tax Blunders to Avoid in Your First Year of Retirement, From a Seasoned Financial Planner
- I'm a Financial Planner: This Layered Approach for Your Retirement Money Can Help Lower Your Stress
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results.
All investing involves risk including loss of principal. No strategy assures success or protects against loss. There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
Guarantees are based on the claims paying ability of the issuing company.
Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price.
Municipal bonds are subject to availability and change in price. They are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise. Interest income may be subject to the alternative minimum tax. Municipal bonds are federally tax-free but other state and local taxes may apply. If sold prior to maturity, capital gains tax could apply.
The target date is the approximate date when investors plan to start withdrawing their money.
DisclaimerThis article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.
TOPICS Adviser Intel Get Kiplinger Today newsletter — freeContact me with news and offers from other Future brandsReceive email from us on behalf of our trusted partners or sponsorsBy submitting your information you agree to the Terms & Conditions and Privacy Policy and are aged 16 or over.
Jeff Judge, CFP®, ChFC®, CLU®, AEP®Social Links NavigationManaging Partner and Certified Financial Planner Professional, Chesapeake Financial PlannersA founding partner at Chesapeake Financial Planners, Jeff Judge is a seasoned guide for busy professionals navigating financial transitions. With nearly two decades of experience, Jeff specializes in helping clients manage complexity during pivotal moments like retirement, business exits and sudden wealth events. Known for his calm, empathetic approach, he helps clients gain clarity and control through Chesapeake's signature R.U.D.D.E.R. Method™.