Tips on supplementing your Social Security income with smart investments

Smart investing is just as important after you retire as it was before you stashed your work wardrobe. Employing wise investment strategies will maximize your income without causing much of your Social Security benefits from becoming taxable. If you are already collecting Social Security income, your former investment ideas may need a major or minor overhaul and tuneup.

Use the following smart investing tips to help you enjoy your retirement

Remember, it's not what you make; it's what you keep. Use investment strategies that maximize your desired monthly retirement income. Depending on your income goals, use investment ideas that generate more than the amount you want to keep each month. A smart investing rule: "Make more money on the money you're making."

Stay up-to-date with current tax treatment of retirement income. All seniors should already know that our leaders in Washington, D.C. have a penchant for changing tax regulations. Unfortunately, these tax changes come with no guarantees that new rules will be in your favor. Inventory all potential generators of your retirement income to help you analyze the currently prevailing tax treatment. Then, create a smart investing and income distribution plan to avoid excess taxation.

Keep your investments "mixed" to maximize income and minimize taxes. Just as you were probably advised during your career years, asset diversification is equally wise during retirement. Since you may "live long and prosper" (Mr. Spock lives), you should use investment strategies that are proven. While you might shy away from growth companies projecting long-term potential success, a good mix will maximize value and minimize loss risk.

Continuing to work? Stay tax smart. A 2011 survey conducted by the Employee Benefit Research Institute (EBRI) found that 74 percent of seniors planned to continue working to supplement their retirement income. Be aware that while you're under 67, your Social Security income can be reduced by $1 for every $2 you earn. Use investment ideas that minimize tax downsides of this current regulation. However, working (at least part-time) will keep your social skills sharp and decrease worry about maximizing your retirement "nest egg."

Accept that there are no "one size fits all" or "magic bullet" investment strategies. Don't be shy. Ask an expert for help when you feel unsure of the best option. Whether you choose a highly-rated professional or a trusted knowledgeable advisor, this is always a smart investing plan, particularly if you are not well-experienced in the investment and/or tax arena.

Do not rely too heavily on bonds. Seniors committed to supplement their Social Security income often make the mistake of over-investing in bonds for their income value. As short-term investment ideas, bonds are acceptable. However, over the longer term, say 10 to 15 years, the bond's currently stated income can be eroded or even devastated by inflation.

Good investment strategies do not totally change when you're trying to supplement Social Security income. Yet, you will have a different focus from investing for the long-term as when you were young. Maximize income and minimize tax consequences is the best plan.

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