There are definitely ground rules when it comes to turning savings into spendable income. Chief among those rules is: Don’t cash in savings until you truly need the money, or are required to take income. This is especially true for employer-sponsored-plan savings. You can leave savings in your plan – to reap tax-deferred accumulation potential – until age 70 1/2 (when you have to begin at least minimum annual distributions). On the flip side, once you start income, you can’t go back to saving in the same account. And, you’ll owe income tax on each payment. While your money is still invested, also be sure to continue to follow rules of diversification and asset allocation to balance your risk. When you do dip into your money and start liquidating savings, here’s what we suggest.

• Taxable first
• Tax-deferred last
• How much to take
• How to manage efficiently