Financial Advisor for Retirees: Managing Money When You Stop Working

For decades, the goal was simple: accumulate as much as possible. In retirement, the challenge inverts: how do you convert a lump sum into sustainable income that lasts 25–35 years without running out?

This transition, from accumulation to distribution, requires a fundamentally different financial planning approach. The biggest risks in retirement are:

• Sequence-of-returns risk: A market crash in the first 5 years of retirement is far more damaging than the same crash at year 20, because early withdrawals deplete the portfolio during the downturn.
• Longevity risk: Outliving your money. A couple aged 65 has a 50% chance that one partner lives to 90+.
• Inflation risk: 3% annual inflation cuts purchasing power in half over 24 years.
• Healthcare risk: Average lifetime healthcare costs for a couple retiring today exceed $300,000.

You can claim Social Security as early as 62 or delay until 70. Each year you delay after Full Retirement Age (FRA) increases your benefit by 8%. Delaying from 62 to 70 can more than double your monthly benefit.

The break-even age, where delaying pays off cumulatively, is typically around 82–84. If you're in good health and expect to live past that age, delaying is usually the optimal choice. For couples, the higher earner delaying to 70 while the lower earner claims earlier often produces the best lifetime outcome.

A financial advisor runs Monte Carlo simulations that account for your health, portfolio size, other income sources, and spousal situation to find your optimal claiming strategy.

The 4% rule, withdrawing 4% of your portfolio in year one and adjusting for inflation annually, has historically provided 30-year portfolio survivability in most market scenarios. On a $1 million portfolio, that's $40,000/year.

But rigid application of the 4% rule ignores flexibility. Research shows that dynamic withdrawal strategies, spending a bit less in bad market years and a bit more in good years, can both improve portfolio longevity and increase lifetime spending. A financial advisor can model a dynamic withdrawal plan specific to your income, expenses, and risk tolerance.

Starting at age 73 (for those born 1951–1959; age 75 for those born 1960+), the IRS requires you to withdraw a minimum amount from traditional IRAs and 401(k)s each year. The amount is calculated by dividing your account balance by an IRS life expectancy factor.

RMDs are taxable income, and for large account holders, they can push you into a higher tax bracket and trigger Medicare premium surcharges (IRMAA). Strategies to manage RMD impact include Roth conversions in the years before RMDs begin, qualified charitable distributions (QCDs) for charitable retirees (up to $105,000/year tax-free directly to charity), and coordinating RMD timing with Social Security to minimize the tax torpedo.

Medicare Part A is premium-free for most retirees. Part B costs $185.80/month in 2026 for most enrollees, but higher-income retirees pay more via IRMAA surcharges (up to $628.90/month). Understanding these surcharges, and managing income to stay below thresholds, is an important retirement income planning consideration.

Long-term care insurance, covering nursing home, assisted living, or in-home care, is generally most cost-effective to purchase in your mid-50s to early 60s. By the mid-70s, premiums are prohibitively expensive or coverage may not be available. A financial advisor can help you model whether self-insuring (using portfolio assets) or purchasing a hybrid life insurance/LTC policy makes sense for your situation.