Retirement isn’t a game. The financial stakes are serious. The prospect of running out of money in retirement is terrifying and real.

In the search for retirement income, many investors often:

• Underestimate inflation risk.

• Sell dividend-paying stocks.

• Lock in low income for life.

• Chase yield.

• Hold more bonds than stocks when interest rates are low.

But for diligent savers, there is a solution—focus from the outset on generating sustainable and increasing income. We outline five problem areas and offer solutions for potential lifetime income:

1. Underestimating Inflation Risk

Money markets, CDs, short-term bond funds and some fixed annuities help avoid short-term market volatility. They deserve consideration in any retirement portfolio. For a portion of it, perhaps. But if you take too little market risk in your retirement portfolio, you also wind up overexposed to inflation. Which, over time, is every bit as dangerous.

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