The important issues are likely to include:

• Reducing the risk of losing your money
• Maintaining a consistent cash income
• Protecting your savings and income from inflation
• Easy access to your money if the need arises.

During your saving years, you may have had much of your money invested in 'growth' assets. These are things like shares and property that rise in value over the years but may not have generated as much regular income as some other types of investments. Now you're retired you may want more of your money invested in things that do generate regular income. You may also want to lower the amount of risk.

To determine the best way to manage your nest egg, you may want to think about how much you depend on your savings and investments to afford the retirement lifestyle you want. Use this as a guide for how much risk you are prepared to take. If you are highly dependent on your nest egg, or some of it, you probably can't afford to take any risks with this money. However, if you are in reasonable financial shape and have money that you don't depend on, you may choose to continue to invest in 'growth' assets.

How much risk can you afford?

You need to be more certain about the outcome. However, even if you don't rely on this money, you still need to be able to sleep at night. If that is an issue then the 'price' for extra security will probably be lower returns.

Your investment strategy

The strategy you choose will depend on how much of a nest egg you have and how much you depend on it to afford the lifestyle you want. You probably need security and stability. However, you may be a long time retired. A 20 year retirement will mean you are still a long-term investor for at least part of your financial portfolio.

Review your investments. Remember to keep your current spending in investments that can easily be converted into cash.

Take an orderly and progressive approach. Be comfortable about spending your capital. As long as you do that in a planned way, you should feel confident about changing the habits of a lifetime and gradually running down your savings. With your nest egg, you planned to have a more comfortable retirement than one that depends just on New Zealand Superannuation. A happy retirement should be partly about spending that nest egg.

Check out the 60plus Budget Calculator or Managing Your Nest Egg Calculator to see approximately how much income you'll have in retirement, based on your life expectancy and investments. You can see how spending more or less of your nest egg or putting money aside to pass on to any beneficiaries will affect your lifestyle.

For further advice, talk to a financial adviser. Sorted.org checklist for financial advice will help you find the right person to meet your needs.

For more information, visit www.sorted.org.nz

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