Living off your Nest Egg is No Yoke

At the risk of ruffling some feathers I’m going to point out a huge problem with retirement that is often swept under the rug. Growing a portfolio to retire off of is no small feat, but it is a completely different puzzle to solve than deciding when to draw what from where in retirement. A nest egg is great to have but building one doesn’t necessarily prepare you to live off it. The dollar amount in your portfolio doesn’t matter as much as most would have you believe and focusing too much on it could leave you running around like a chicken with its head cut off. 

Unfortunately, taxes don’t disappear when you retire and you only get to spend what you can net from your portfolio, or other sources of income. Understanding the tax treatment of your different resources and coming up with a plan for when to tap which could significantly impact how much actual spending money you can get from that nest egg.  Just because you must pay taxes, doesn’t mean you’re powerless. A comprehensive plan could give you more control over where your money goes. Depending on your circumstances the range of what goes to you, Uncle Sam, Charities, or your beneficiaries could be gigantic. 

Though we do not provide tax or legal advice, we believe strongly that retirement income planning should never be thought of in a vacuum. Whenever possible, we collaborate with clients’ tax and legal professionals. Instead of things being siloed, we strive to lead a team for you who oversees the continuity of a plan with your other professionals and actively checking for blind spots that could otherwise go unnoticed.

Through decades of helping people in retirement we became proficient in legalese and CPA and do our best to prevent anything getting lost in translation. 

Our experience has also taught us the potential pitfalls of trying to save on taxes in the short term. Saving on this year’s tax bill sounds amazing, but what will that leave you with for next year? How about 5 years from now. Or 20? It’s a bit of a balancing act but cohesive advice can help. 

By reviewing estate planning documents and having open dialogue with our clients’ attorneys, we sometimes uncover oversights that could complicate legacies. Laws change over time and it is important to periodically review if life events or legislation have left your plan outdated.

Waiting until you’re already retired to think about this could leave your nest egg fried, poached, scrambled, or over hard instead of sunny side up or over easy. You don’t have to be one of the many retirees who learn this the hard way. Join our family so together we can create “a better environment for your retirement.”