Keep in mind the following points when deciding how to handle any lump sum distribution you receive from a savings or retirement plan:

• Plan for a long life. Today people are living longer due to advances in medicine and better awareness of the need for good nutrition and exercise. Plan an investment strategy that will help keep you financially secure.
• Plan on a number of sources to finance your retirement. For many retirees that will mean a three-legged stool of Social Security, a traditional pension and the income from your own savings or retirement plan. Your standard of living will likely depend on how well you manage the financial resources under your own control.
• Anticipate inflation. It’s not how many dollars you have now that matters, but what those dollars will buy in the future. Inflation erodes a dollar’s buying power over time. Factor in a steady rate of inflation when investing your lump sum. Aim for earnings that outpace the rate of inflation.
• Diversify your retirement investments. Don’t put all your eggs in one basket. Diversifying means balancing your investments by placing some money in conservative investments with a guaranteed rate of return and some in more aggressive investments that carry more risk but have a potential for greater returns. The ideal mix depends on whether you are a conservative, moderate or aggressive investor and may change over time as your circumstances change. Diversification cannot eliminate the risk of investment loss.
• Get advice. Consult a qualified financial professional, accountant or tax advisor on how to handle your lump sum distribution in the most beneficial way.

Being on the receiving end of a potentially large sum of money can be intimidating, but with careful planning you can make the most of your resources to look forward to a comfortable and secure retirement.