Most of the financial planning magazines we glance at each month have started to focus on retirement income strategies.  Makes sense as 77 million baby boomers have been busy accumulating assets and at some point will start to withdraw from their nest eggs.   With the uncertainity of Social Security and lack of pensions for many of these boomers-lets just hope it's a big nest egg. 

Many planners believe we have a retirement income crisis.  Our traditional sources of retirement income-Social Security and defined benefit pension plans (remember the three-legged stool?) -will replace a smaller portion of necessary income in retirement.  A recent Fidelity Reseach Institute study pointed out the huge "gap" we may face.  It will be a challenge.  Their recent paper pointed out some "building blocks" we need to understand in order to generate income.

The building blocks for retirement income include:

• Systematic Withdrawal Plans (SWP) Probably the most familiar strategy of taking periodic withdrawals from your 401k plan or IRA account.
• Income Annuities  Starting to be offered as a 401k option.  Creating you own pension.
• Variable Annuities with "living "benefits".  Annuities that allow you to withdraw 5-7% of your inital contribution each year to create a pension.

Fidelity Research Institute Structuring Income For Life