As we travel through life, we enjoy the comfort of familiarity. We know what our pay is, how our health insurance works, and typically what our bills are. There’s comfort knowing that we have a steady cash flow from our jobs.
As we transition into retirement, it can come with a lot of uncertainty. For example: What’s our Social Security Benefit going to be? How do we create a steady cash flow with the wealth we’ve accumulated? What’s our tax picture going to look like?
I’d like to share with you some real-life examples on how we can create peace of mind in retirement, and how it can easily be accomplished by working with the right partner.
I’d like to start off by saying that most people are purpose-driven. Throughout our working career, we have a “job”. We are parents. We are spouses. Mathematically, we may spend most of our time at our jobs, which is the underlying foundation of purpose.
Have you thought about what you want to “retire to”? How would you like to spend your time, day to day? Do you have projects or grandchildren you want to spend time with? Do you have a camp you can relax at or places you want to visit regularly?
The nice thing about redefining your purpose is that you are in the driver’s seat. You get to decide how you want to spend your time. When you can articulate your new purpose, you have something to strive for. I have seen too many times in my career where people don’t redefine their purpose, and they end up having more struggles than those who do. Be intentional with your retirement.
Once you have defined what you want retirement to look like, you now have a baseline as to what that lifestyle will cost. If you just want to stay around the house, tend your gardens, or even pick up a new hobby like art or woodworking, we can estimate the cost.
If you want to travel the world, snowbird, or visit your grandchildren across the country, we can estimate that too! Having a general idea of your cost-of-living will help advisors formulate an “Income Plan”. This “Income Plan” is designed to be flexible and evolve as life changes, with the end-goal of creating a reliable monthly cash flow that feels familiar.
For many retirees, that means structuring income so Social Security arrives mid-month, while investment distributions are timed at the beginning or end of the month—creating a rhythm that can feel similar to receiving a paycheck. The steady, predictable cash flow brings familiarity and peace of mind, with the understanding that money will always be coming in to support your lifestyle.
An important piece of this retirement puzzle is addressing what your investments are and how they work. If all of your investments are in the market and we experience a recession, is that going to make you emotionally uncomfortable? Money is emotional, and when you start becoming anxious about things outside of your control, that anxiety can affect you physically, leading to health issues.
What if you had an investment that didn’t lose money when the market went down? Do you think that would help preserve your wealth? If you had “safe money” and “risky money”, not having all your accounts lose money may give you an additional peace of mind, because you have an alternative bucket to pull from when things get choppy in the market. If you do have “safe money”, you can let the market do its thing and not have an interruption in your cash flow, all while giving your stock market accounts “time to heal”.
To summarize, there are a lot of emotional factors at play in retirement. Purpose, lifestyle, cash flow, and a myriad of other things all matter.
We strive to educate all of our clients in these situations and plan for the unknown. When you have a plan, you can be prepared for what may come next. Working with our team and our years of experience, providing certainty during uncertain times, will help you achieve clarity and familiarity. After all, you’ve worked hard to get to where you are. Why not allow yourself the ability to enjoy it, knowing that whatever may come your way, your trusted advisor will always strive to provide peace of mind.