What Does Great Retirement Planning Actually Look Like?
A comprehensive retirement plan usually includes a lot of important documents.
Charts and graphs. Monte Carlo simulations. Annual rate of return projections. Lifetime tax liability. Legacy plans.
But a comprehensive retirement plan isn't just documents.
It's a dynamic framework for making the best possible decisions for you, your family, your money, and your life for decades to come.
And as important as the numbers printed in black and white are to that framework, I believe that the true strength of a retirement plan is measured by its durability and by the confidence it gives seniors to live their best lives during their Golden Years.
A Great Plan Gives You Confidence, Not Certainty
Folks have plenty to be anxious about in the world right now. And so many of those scary headlines we're all scrolling through touch on how we feel about our money.
The older you get, the closer you are to retirement, the bigger those worries can become.
But too many seniors look for answers in the wrong places. "Can't miss" investment products. Pulling out of the markets and hoarding cash. Jumping into gold or other alternative investments. Putting off retirement for another year or two until "the time is right."
In short, they're looking for certainty, the kind that they can see in black and white on a spreadsheet. That paycheck coming in every month. The balances holding steady in a savings account.
Unfortunately, we can never be certain that the markets won't dip, that inflation won't spike, that a new piece of legislation won't affect tax planning, or that you or your spouse won't receive bad news at your next doctor's appointment.
But we can be prepared.
Saying “I’ll retire when things feel more certain" is basically the same as saying "I'm never going to retire.” Something in the world or in your life will always pop up to make you feel a little less sure about tomorrow.
But the confidence that comes with a comprehensive financial plan is much more durable – and more valuable – than certainty. When you're confident in your plan, you can feel better prepared to navigate challenges and keep progressing toward your goals on your terms.
A Great Plan Is Flexible
If your financial plan's only job is to drive up your projected returns, then you'd just pour as much money as you could into your brokerage accounts.
But what happens if there's a major market correction?
If your sole focus is lowering lifetime tax liability, you'd convert as much money as you could into Roth accounts.
But large Roth conversions could drive up your Medicare premiums and deplete your cash reserves.
In other words, the more "perfect" one part of your plan looks on paper, the more fragile other parts become.
Your plan doesn't need to be "perfect." It needs "shock absorbers" that will keep you steady through:
Changes in the Markets: If you retire into a sudden market drop, balanced and diversified assets give you flexibility and liquidity to ride out a rough patch and take advantage of "buy low" opportunities.
Changes to Your Health: Medicare doesn't cover every medical cost. Your plan should provide for the care you and your spouse need now and the care you could need in the future – including things like in-home nursing or long-term care.
Changes to Your Priorities: You're not the same person at 65 that you were at 55. You won't be the same person at 75 or 85 either. As your bucket list changes, your plan should be able to change as well.
A Great Plan Supports Better Decisions
Bad news can cause our instinctual "fight or flight" mechanisms to kick in.
And too many investors choose "flight": from the markets, from risk, from the emotional discipline that helped them build wealth in the first place.
A financial plan should give you the confidence to manage those emotions.
Instead of worrying about what you should do right now, in an emotional moment, you can fall back on the guardrails that you and your advisor built around your risk tolerance, your short-term needs, and your long-term security.
Instead of reacting, you're executing. The plan dictates your next move, guiding you along your decision tree away from scary headlines and back to your fundamental principles as an investor: patience, discipline, and perspective.
The market isn't in control. You are.
A Great Plan Works for Your Family, Not Just For You
Your financial plan isn't just bigger than your numbers.
It's bigger than you.
Your retirement should be full of bucket-list adventures and long weekends on the golf course, fine dining and quiet comfort.
But true peace of mind comes from knowing that you've provided for the people who matter the most as well.
Peace of mind comes from being confident that if something were to happen to you tomorrow, your plan will keep working to support your spouse, help your kids buy their first home, and provide for your grandkids' college education.
And peace of mind comes from knowing that if your health declines unexpectedly and you're unable to make decisions for yourself, your loved ones will be able to follow your decision framework to make sure that you're cared for with dignity and grace and that your legacy will live on.
A Great Advisor Does More Than Build the Plan
Hitting your "retirement number" can give you a goal that makes you feel a little less anxious about retirement.
Rules of thumb and back-of-the-napkin math can give you a general idea of what you can safely withdraw every year.
Computer software can project decades of market returns and tax liability.
But to sharpen your decision-making into a plan that you're truly confident in, you need an advisor you're confident in as well.
You can trust my team at Keen Wealth to keep your financial plan on track. But just as importantly, you can trust us to be your financial decision partner.
And throughout your retirement, we strive to provide value that extends beyond the margins of your spreadsheets by helping you feel more confident about the choices you're making and the life your plan is designed to support.
About Bill
Bill Keen is a financial advisor with over 30 years of industry experience. As the founder and CEO of Keen Wealth Advisors, a registered investment advisory firm, he focuses on providing personalized retirement planning designed to help people thrive before and during their retirement years. With a passion for educating others, Bill regularly blogs about retirement planning, hosts the podcast Keen on Retirement, and has contributed to Forbes, U.S. News and World Report, Reuters, Wall Street Journal’s Market Watch, Yahoo Finance, and other publications. Based in Overland Park, Kansas, Bill and his team work with clients throughout the greater Kansas City area and across the nation. To learn more, connect with him on LinkedIn or visit www.keenwealthadvisors.com.
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