Ric Edelman: Hi! I am Ric Edelman. Today, we're talking about a systematic withdrawal plan. If you're retired or about to be, you shouldn't be putting all of your money into CDs. Your money and your income need to grow to keep up with inflation. The solution is a systematic withdrawal plan. Begin by building a diversified portfolio. This doesn't mean putting all of your money in a stock market. There are many different types of investments out there. Turn to a financial advisor for help with this or use my guide to portfolio selection at ricedelman.

com. In an ideal world, you'll have a diversified portfolio throughout your life. You won't need a dramatic makeover when you retire.

Once you have a diversified portfolio, you can withdraw money from it at a rate of no more than 5% per year. You can easily set this up, so that your check or direct deposit arrives like clockwork every month just like social security. If you use a systematic withdrawal plan, your account balance will fluctuate. But so what? Your income is stable and that's your primary concern. Don't believe the myth that you need to move your investments to CDs when you retire, because now you know the truth.