What are the three ‘legs’ of retirement?

Saving for retirement is no small job. Think about it: You’re saving up to live for likely 20 years or more with no income from a traditional salary. An appropriate response to such a big undertaking could be to tackle the job from multiple angles.

Enter the three-legged stool, an approach to retirement income that considers multiple sources. Here’s an overview of each of the different legs in the model.

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Personal Savings

For those looking to beef up their retirement savings, accounts specifically designed for retirement could be a good bet.


Pensions are retirement programs wherein the employer saves, invests, and disburses money on behalf of their employees. Basically, the company takes care of everything.

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Social Security

Social Security is guaranteed lifetime income for workers who pay into the program each year via their FICA taxes. Both the employee and the employer pay into Social Security.


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