Requiring Fewer Dividends in Retirement

Conventional retirement wisdom holds that you’ll need to replace 80% of pre-retirement income in order to maintain your lifestyle once you’ve stopped working. For dividend investors, that means building a sizeable nest egg of dividend-paying equities.

But there’s a very good chance you won’t need that much, according to recent work by retirement expert Michael Finke. A lower replacement rate translates into more investment latitude and less pressure to reach for yield and take on greater risk.