Help Me Retire: I’m 60 with $6,100-a-month in Social Security disability and a pension. I want my money to work for 20 years — what do you recommend?

I am a 60 year-old single woman who lives with a partner, who is a disabled. We are not married mostly due to financial reasons.

I have just started receiving Social Security disability benefits after being forced to retire in 2021. I have a pension of $3,200 per month and a Social Security payment of $2,900 (but that will be lower with Medicare and taxes taken out). 

I live in a small town home. I refinanced my $185,000 mortgage a few years ago at 3.1% interest. I will pay the last payment on a 2018 SUV in December, but I may need a new car soon. (Interest rates are way too high so I am trying to wait, but I’m getting anxious.)

I have $100,000 in savings, and approximately $70,000 in investments. I have a 403(b) that’s valued at about $52,000 and a traditional IRA valued at about $7,000. I need this money to work for me, assuming I live at least until 80! 

Because of my pension and Social Security disability payments, I am once again in a ridiculous tax bracket. I don’t know who to trust with my information. Can you help?

See: ‘We stay in two-star hotels’: We’re 70 and have $1.8 million, but my husband insists on living cheap. Don’t we have enough?

Dear Reader, 

Get serious about your budget. Once you know your cash flow, you will be better able to prepare your long-term plans, and how much money you can set aside for your future. 

There is more to this puzzle than income and investments. If you’re spending more than your Social Security and pension income, you’ll be eroding your retirement nest egg faster — that would be bad, especially as you want that money to last at least another 20 years. 

But while 20 years seems like a long time, you could very well live longer than that, so expect to be even more conservative when calculating your life expectancy, and your retirement needs.

As for how to make your money work for you, that comes down to a few factors.

Choosing your accounts

Risk-averse individuals prefer easily-liquidated accounts, such as a CD, money-market fund or even a high-yield savings account. The rates attached to some of these options are pretty favorable, but that won’t last forever, and these accounts likely won’t keep up with inflation and cost-of-living expenses.

However, keep some of your money in easily accessible accounts in case of an emergency. That way, you won’t have to draw from your retirement accounts in the event of a market downturn. Set aside three to six months’ worth of living expenses for an emergency, but it wouldn’t hurt to bump that up to one year, or more, for a retired single person.

Asset allocation

For your investments, asset allocation is crucial. Check your 403(b) and IRA now to see how they’re invested. If you’re not sure what the asset allocation means for your long-term goals, ask a representative that works at the firms holding these accounts.

People argue whether the 60/40 portfolio is really helpful anymore, where 60% is invested in stocks and 40% in bonds, but you can still use that as a guide. Stocks are supposed to generate income, while bonds are meant to protect and preserve your money. 

A target-date fund is a good starting point for an investing novice. Those funds automatically adjust to be less risky as it gets closer to its target year — say, 2045 or 2050. But these funds are just starting points, given that some retirees’ investing needs may require more personalization. 

Don’t make any hasty moves, and don’t be too aggressive. There is a fine line when investing — a tightrope. Too aggressive, and your account balances could drop along with the stock market. Too conservative, you won’t keep up with inflation, and you will lose purchasing power. 

Finding help 

Find a qualified financial planner to determine the right balance for your asset allocation, as well as how to break up your assets between various accounts. The right planner can run numerous financial scenarios for you to see how your life span will affect your assets, and they’ll be able to find tax-advantageous strategies that work best for your circumstances.

It may take time to find an adviser you trust and feel comfortable with, so remember you don’t need to work with the first adviser you meet. Ask questions like how they are paid and if they have a fiduciary duty to you (that is, they’re required to act in your best interests). You can start your search with the Financial Planning Association’s PlannerSearch and the XY Planning Network’s tool

Have you thought about taking on a little side hustle that will generate extra income? You don’t want to earn too much, since that will affect your Social Security disability benefits, but you can make some extra money if you’re willing and able.

Social Security’s Substantial Gainful Activity limit, which is the amount of money you can make while getting disability benefits, is $1,470 a month (or $2,460 for those who are blind), according to the Social Security Administration

While your pension and Social Security benefits are great, it wouldn’t hurt to have a nest egg, especially considering how expensive healthcare can be. And it’s costlier the older you get. This would help you avoid having to tap your home equity.

This could potentially increase your taxes, of course, but the trade-off could be worth it.

Also, talk to your partner. You mentioned you’re not married because of financial circumstances, but what are your expectations for your golden years?

Get your estate planning documents in order, like a will and healthcare proxy, because without those, the court decides what to do with your affairs — and sometimes, those decisions are not aligned with your wishes. Then all of your hard work and planning are in jeopardy, too. 

All of this will take patience to accomplish, but take it one step at a time.

Readers: Do you have suggestions for this reader? Add them in the comments below.

Have a question about your own retirement savings? Email us at HelpMeRetire@marketwatch.com

Also see: ‘I wake up with anxiety’: My husband leaves retirement-investing plans to me. How do I hire the right adviser?