Financial Planning for a Retirement-Ready Life

Brian and Laurie built their nest egg with a disciplined approach to saving. Despite their relative affluence, they were having a hard time contextualizing their wealth and were uncertain if it was “enough” to maintain their dignity and independence throughout their lifetimes.

They recently moved to Doylestown, Pennsylvania, to be closer to their newborn grandchildren, but they still harbored trepidation about their financial circumstances. Although they had diligently collected investments of various tax types, including tax- deferred assets, after-tax brokerage accounts, and Roth IRA assets, they were unsure how to draw monthly cash flows from these accounts in a tax-efficient and strategic manner.

To compound their worry, their portfolio was largely self-managed and a seemingly random collection of retail mutual funds held at nine different custodians, some of which they maintained in a separate IRA with a broker referred to them by their neighbor. There existed no coherent strategy for their investments, and the result was a portfolio highly concentrated in the stocks of large U.S. companies and a handful of bonds that were inappropriately risky. Brian and Laurie were aware that nine different large U.S. stock funds did not constitute diversification, and that they were taking on more risks and higher expenses than was pruden — they just weren’t sure how to repair their portfolio and position it for retirement. They reached out to us when they recognized they weren’t confident about what to do next.

After sitting down with Brian and Laurie and exploring their concerns and income needs in retirement, we formulated retirement projections to show how a properly diversified portfolio can provide retirement cash flows more reliably than their current investments. We also engineered a distribution strategy fractionally drawing on IRAs, Roth IRAs, and investments with various cost bases in their taxable accounts in precise proportions to deliver consistent monthly cash flow while minimizing income taxes over a multi-decade planning horizon.

We also tackled analysis to advise on lump sum vs. monthly pension distribution options, optimal Social Security Income claiming strategies, strategic Roth IRA conversions, surrendering an expensive and unnecessary Variable Life Insurance policy, and navigating the complexities of their employer retiree health insurance coverage. Lastly (but certainly not least!), we mapped out funds to support annual three-week beach vacation rentals in Avalon, NJ, to bring the whole family together every summer.

This example is hypothetical and for illustrative purposes only. It is intended to reflect a typical client relationship and does not describe the experience of any actual client or represent an endorsement or testimonial of our firm.

When you retire, you want to know that your financial decisions can support your life for the decades to come. You may also have:

• Questions about whether your financial resources can sustain your retirement spending

• Uncertainty around drawing income from multiple account types

• Portfolios that haven’t been structured for retirement distributions

• Social Security, pension, and healthcare decisions with lasting implications

• The challenge of balancing changing spending needs, taxes, and investment risk

At Rockwood Wealth Management, we help you prepare for retirement by evaluating income, investments, and key decisions together so that your plan finally feels complete.