How do you pivot from a moderately aggressive portfolio in the accumulation stage of retirement planning to the decumulation stage? In today’s episode, we tackle two listener questions about the mechanics of decumulation in retirement planning. You’ll also hear a question about using QLACs to reduce RMDs. If you are wondering about the details on how exactly you are going to make this retirement thing work then be sure to press play. 

Retirement plan live is coming soon to a podcast near you! 

In January we’ll be hosting the next edition of Retirement Plan Live. Retirement Plan Live is an extremely popular series that we run each year where I walk out the logistics of creating a retirement plan over the course of 4 episodes with a listener. At the end of the series, we host a live webinar where we analyze whether that particular plan is feasible. Our last Retirement Plan Live series dealt with Trish and her unexpected retirement. 

If you would like to be the next subject of RPL, make sure you are signed up for the 6-Shot Saturday newsletter so that you can access the link to the application form. We’ll choose one listener from the dozens of applications we receive. We will make sure to change the name and details of your situation while at the same time keeping the generalities in check. Listen in to hear the details. 

How to get the most bang for your buck in your retirement portfolio

Steve has invested moderately aggressively, but as he turns 65 and enters retirement he is looking to become more conservative while at the same time getting the most bang for his buck. He is trying to figure out how to structure his portfolio conservatively while providing a bit of growth and income through dividends.

The best way to approach this or any retirement planning question is to take a top-down approach. If you start at the bottom and work your way up you miss out on how your question fits into the big picture. 

Retirement planning starts with your overall goals for retirement. Then you need to understand how this particular question fits into your retirement plan. Once you have a feasible plan, then you can build a cash flow model which plans out your spending over the next 5 years and beyond. Once you have this cash flow model in place then you can make that model resilient. This is where your question comes in. How would you make your plan resilient? 

Do you want to optimize your portfolio for more money and higher returns or do you prefer to have a high level of confidence in your spending no matter the market? Rather than getting the most bang for your buck, consider what kind of outcome you would prefer to secure. 

How to simplify retirement accounts without taking a huge tax hit

Karen is planning on retiring at age 61, but before she does she would like to simplify her retirement accounts. Currently, she has over 50 different investments. She wants to simplify the accounts into as few funds as possible and rebalance them without taking a huge tax hit. 

Once again, we must approach this problem in an organized way. When you consider what you are trying to accomplish by simplifying your accounts then you can see how this exercise will fit into your overall retirement plan. How would you approach this question? 

OUTLINE OF THIS EPISODE OF THE RETIREMENT ANSWER MAN

PRACTICAL PLANNING SEGMENT

• [1:30] News on the show

LISTENER QUESTIONS

• [6:25] Using QLACs in retirement planning to reduce RMDs
• [11:35] Rita is interested in another series on long term care
• [12:46] Steve’s question getting the most bang for his buck during decumulation
• [30:20] Karen’s question about simplifying her portfolio

TODAY’S SMART SPRINT SEGMENT

• [40:14] Go beyond the normal thankful things--think about the things that warm your spirit

Resources Mentioned In This Episode

Retirement Plan Live 2021 - start here

Decumulation series - start here

Rock Retirement Club

Roger’s YouTube Channel - Roger That

BOOK - Rock Retirement  by Roger Whitney

Work with Roger

Roger’s Retirement Learning Center