When the folks here at MoneyLetter and Asset Strategy speak with individual investors these days, we often hear some variation of this theme: “I’m nervous about my investments due to stock market volatility, high inflation, and the jump in interest rates.” We suggest concerned investors develop a plan designed to provide income and security in this volatile market, says Brian Kelly, editor of Money Letter.

Once you have such a plan in place, then when one of those challenges inevitably happens, you have the confidence to stick to your plan. To implement a strategy like this, you’ll want to build a diversified portfolio of lifetime retirement income that can protect against various economic challenges.

Such a portfolio would have a mix of protected and variable lifetime retirement paychecks. Then manage your regular and periodic spending so that the total of your combination of retirement paychecks has a healthy margin over your regular and nonregular living expenses. This helps you deal with surprises that are sure to come over the course of a long retirement.

You’ll want to be sure that a portion of your lifetime retirement income is protected against stock market volatility. For people who haven’t yet retired, you can do this by holding off on starting your Social Security benefits for as long as possible (but not past age 70) to maximize the value.

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If you have already started your Social Security benefits, you may feel more secure with additional protected lifetime income. Our idea: Invest a portion of your portfolio in a low-cost, guaranteed income annuity.

“But aren’t annuities a bad deal?” some investors wonder. The answer depends on who you ask, the structure, and what you are trying to accomplish. You’ll need to do some careful shopping or find an unbiased advisor you trust who is properly licensed and experienced with annuities to guide you.

You could also build a bond ladder that provides regular cashflow for a specified period. Since some of our investor friends are in their late 70s, they can build a bond or CD ladder that would most likely deliver regular cashflow for the rest of their lives.

Dividend-paying stocks are popular among investors seeking regular income from their investments. They can be particularly attractive for retirees or individuals looking for a passive income stream. Option to consider: Dividend income can be reinvested to purchase additional shares, providing the potential for compounding returns over time.

Lastly, for income seeking investors that may already have enough exposure to stocks and bonds, income from passive investment real estate can potentially create rental income and capital appreciation. We are not suggesting a retiree become a hands-on landlord at a later stage of life, but a passive solution could create cash flow, tax benefits, diversification, and a hedge against inflation.

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