You’ve worked hard and saved diligently, and now you’re in retirement or on the doorstep of it. You’ve run the numbers. You might even have a sizable nest egg. So why do you still feel uneasy?
That lingering anxiety is more common than you think, even among those who appear to be financially prepared for retirement. And it often comes down to one surprising truth: saving enough isn’t the same as having a plan to make that money last.
The Shift From Saving to Spending
During your working years, the strategy was simple—put money away and let it grow. But retirement flips that equation on its head. Instead of building your wealth, you’re now drawing from it. And that shift can create a whole new layer of uncertainty:
- How much can I safely withdraw each year?
- Will I outlive my savings?
- What happens if the market crashes early in my retirement?
- Am I paying more in taxes than I need to?
These aren’t hypothetical questions. They’re real concerns with real financial consequences.
The Risk of Outliving Your Money
This is one of the biggest fears retirees face, and with good reason. Thanks to medical advances and healthier lifestyles, many people are living well into their 80s, 90s, and beyond. A retirement that lasts 30 years or more isn’t uncommon anymore. Depending on your withdrawal strategy, timeline, and market conditions, even a seven-figure portfolio may not last as long as expected.
Inflation and Rising Costs
Even a low inflation rate can quietly erode your purchasing power over time. Add in rising healthcare expenses, long-term care needs, or unexpected emergencies, and what once looked like a comfortable cushion may start to feel uncomfortably thin.
Sequence of Returns Risk
If the market drops early in your retirement—just as you begin taking withdrawals—your investments may not have enough time to recover. That’s called “sequence of returns risk,” and it can accelerate how quickly your money runs out, even if average returns over time look solid.
The Solution: Turn Your Savings Into a Strategy
The good news? These problems aren’t inevitable. They’re solvable, but not with guesswork.
Creating a true retirement income plan means:
- Mapping out your spending needs over time
- Accounting for inflation, taxes, and healthcare
- Using informed withdrawal strategies
- Building a blend of income sources: Social Security, pensions, annuities, dividends, and investment withdrawals
- Establishing an appropriate asset allocation and income buffers based on your goals and risk tolerance
It can help to work with a professional who understands retirement planning strategies and can tailor guidance to your unique goals.
Worried You Might Be Missing Something? Let’s Talk
If you’d like to discuss how to create a plan tailored to your retirement needs, we offer complimentary consultations. Our goal is to help you explore strategies that align with your financial objectives and lifestyle preferences.
