Retirement Income Review 2025

3 Year Chart

In 2025 my investment portfolio increased by 8.65% and generated $3445 in monthly dividend income. During the year I was able to avoid taking any distributions from my retirement account. This means that I only used dividends from my taxable spending account. The income from that account was $1052 per month or $12,624 per year. I withdrew $11,860 to pay my credit card balance and mortgage. My total expenses for the year came to $15,509. The bulk of the $3649 shortfall was covered by my state property tax refund. For reference, the 2025 US poverty level for a one-person household was $15,650. 

There is a lot of debate about how much you need to retire. Americans now think you need about $1.5 million to retire. But only 3.2% of retirees have $1 million in their retirement accounts. Only about 2.5% of all Americans actually have $1 million or more saved in their retirement accounts. I am still a bit short of that goal, mainly because I've been withdrawing money for living expenses for the last 5 years. But I will say that my annual dividend and investment gains now exceed my pre-retirement salary. In the chart above it looks like I am doing well, despite my taxable income being at the poverty level.

The more money you have the more complicated your finances become. I have 26 different holdings, 4 checking accounts, 3 different financial institutions, a brokerage account, a spending account, and a retirement account. Plus being trustee for a small family trust. Surprisingly, I use all of the various accounts on a regular basis. Managing my investments has become my part-time job. I usually only make small adjustments from time to time. I spend more time following financial news, so that I am aware of investment opportunities and pitfalls. The one thing that has proven true is that time in the market beats timing the market. My portfolio balance will sometimes fluctuate by thousands of dollars per day. But even when the market is down, I know that those dividends will keep flowing in.

In 2026, I expect we will see interest rates drop further. This should stimulate growth in the economy by lowering the cost of borrowing money. We will probably see investors slowly moving away from AI and back into the manufacturing and housing sectors. Global conflicts will continue to affect commodity prices but should be good for the defense and cyber security sectors. Hopefully, the shock from Trump's tariff price increases will normalize and we will be able to see inflation become more predictable. The national debt also looms as a threat to our financial future. One thing is certain; American's will be spending more on healthcare and have less disposable income in the year ahead.