Retirement money: Six common sources

In retirement, you’ll live on money saved, received, earned, and invested.

Sources of retirement income

Social Security
The amount you receive in Social Security will vary based on how much you earn, but for many retirees today, their benefits equate to 20% to 30% of their pre-retirement income.

Savings
This is money you save. Try to earn the highest rate of compound interest you can.

A happy, adult couple with their arms around each other.

Investments
Your portfolio of investments might include stocks, mutual funds, bonds, etc.

Pension
Not too many people are lucky enough to have a pension. Even when pension plans were at their peak in 1985, fewer than half of Americans working for private companies were covered. By one current estimate, only 17% of those employed outside of government agencies can expect to receive traditional pension checks in retirement.

New income
Many people — if they can — continue to earn money by working part-time, running a small business, or cycling between periods of employment and leisure. In addition to the income, continuing to work helps many people to feel connected, useful, and satisfied with life.

Home equity
If you’re a homeowner, another source of retirement funds might be the home equity you have accumulated over the years.

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