Crafting Your Retirement Roadmap: The Integrated Approach to Income Sufficiency

By: Austin Winsett, CPA, Senior Wealth Advisor

Planning for retirement is a critical financial milestone and one of the most crucial aspects of ensuring you have sufficient capital and growth to support your desired lifestyle. To create a clear and successful plan for retirement, it's essential to take an integrated approach. In this article, we will explore how an integrated plan can help you craft a retirement roadmap that ensures the longevity of your wealth.

The Challenge of Retirement Income Planning:

As you approach retirement, you may have various sources of income to consider, including Social Security, pensions, retirement accounts, and personal savings. The challenge lies in optimizing these sources to cover your expenses while making the most of tax advantages and investment opportunities.

Many individuals have apprehension about the longevity of their savings. Questions arise: Will I have enough income to maintain my current lifestyle? How can I minimize tax implications during retirement? What if unexpected expenses arise?

The Integrated Approach:

Financial planning should take a holistic view of your financial situation and align all aspects of your financial life to work together cohesively. It means considering not only your investments but also tax strategies, estate planning, risk management and all of your retirement goals within a single, comprehensive plan.

Crafting Your Retirement Roadmap:

1. Income Streams: First steps of your plan should identify and maximize various income streams, including Social Security, pensions, annuities, and investment income. By coordinating these sources strategically, you can achieve a steady flow of income throughout retirement.
2. Tax Efficiency: Integrated planning includes tax-efficient strategies to minimize your tax liability during retirement. This may involve optimizing the timing of withdrawals from retirement accounts and leveraging tax deductions available to retirees. In some cases, creating more tax now to save substantially more in later years. For taxable assets not held in tax deferred or tax-free accounts, building out a portfolio that not only captures the expected total return to meet your goals, but does so with less tax drag.
3. Asset Allocation and Location: Your retirement roadmap should consider an asset allocation tailored to your retirement goals and risk tolerance. It ensures that your investments are aligned with your spending goals, providing stability and overall growth potential. By knowing the rate of return you may need to accomplish your goals, you can then set out to build the right balanced portfolio to achieve that hurdle rate while also ensuring there is sufficient capital in more stable assets during market downturns. The location of certain investments is also important as different investments and different account types have differing tax consequences.
4. Contingency Planning: Integrated planning anticipates unexpected events and expenses, such as medical emergencies or long-term care needs. It includes strategies to protect your retirement income and assets in the face of unexpected challenges.

Creating a clear and comprehensive retirement roadmap is essential for ensuring longevity of your wealth over your lifetime and beyond. The integrated approach to financial planning offers a solution that considers all aspects of your retirement income.

By embracing a comprehensive financial plan, you can take control and spend time focusing on what matters to you without apprehension. To begin your personalized journey toward income sufficiency and a secure retirement, we invite you to schedule a meeting with our advisors.

Disclaimer: The information provided in this article is for educational purposes only and should not be considered as financial or legal advice. Please consult with your financial and tax advisors to determine plans for your individual circumstances.

Exencial Wealth Advisors is an SEC registered investment adviser.  Any references to the terms “registered investment adviser” or “registered,” do not imply that Exencial or any person associated with Exencial has achieved a certain level of skill or training.