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Author: Kevin Lao

5 Retirement Strategies for Navigating Market Volatility in 2026

The current geopolitical tensions involving Iran have sent ripples through global markets. If you’re approaching retirement or have recently retired, you’re probably feeling some anxiety about your financial future. As someone who works with retirees daily, I’m seeing a familiar pattern emerge—the same concerns that surfaced during the 2020 COVID crisis and the 2008 financial meltdown.

Right now, we’re witnessing significant market volatility due to the Iran conflict. This conflict has effectively shut down the Strait of Hormuz—a critical waterway that accounts for about 20% of global oil consumption. This disruption is driving up energy costs, squeezing business margins, and creating uncertainty about future economic conditions.

For those planning to retire within the next year or two, or those who’ve recently entered retirement, this volatility raises serious questions about timing and financial security.  In this blog post, we’ll touch on five retirement strategies to help you navigate this current market volatility. 

The One-More-Year Syndrome: Why Market Volatility Affects Retirement Decisions

During my recent client reviews, I noticed something troubling. Many clients who were planning to retire this year are now considering pushing back their retirement. This phenomenon, which I call the “One-more-year syndrome,” isn’t new. I witnessed the same pattern during the 2020 pandemic when global markets crashed and again during the 2008 financial crisis.

The concern is understandable. Sequence of returns risk—the danger of experiencing poor market performance early in retirement—can significantly impact your long-term financial security. Historical data shows that retiring during major market downturns, such as the early 2000s tech crash or the 2008 financial crisis, can be particularly challenging for retirees who don’t have proper strategies in place.

However, here’s what many people don’t realize:

Even those who retired during the difficult 2022 triple bear market—stocks down 20%, bonds down 13–15%, and cash losing value—have seen a strong recovery from 2023 to 2025. The key is having the right retirement strategies to weather these storms.

Understanding the Current Market Impact

The Iran conflict is creating specific challenges that retirees need to understand. Oil prices have jumped over 40%, and this impacts everything from shipping costs to business profitability.

What makes this situation particularly concerning for retirement planning is the potential impact on inflation. Coming into 2026, markets expected the Federal Reserve to cut interest rates two to three times. However, if oil prices remain elevated and inflation becomes stickier, those rate cuts may not materialize. This uncertainty affects both stock and bond markets, creating the kind of volatility that can disrupt traditional investment strategies for retirement.

The situation is further complicated by the broader implications for artificial intelligence infrastructure, which requires enormous amounts of energy. The current administration’s focus on energy independence and the potential impact on China’s energy supply adds another layer of complexity to global markets.

Essential Retirement Strategies for Market Volatility

The Guardrails Framework

One of the most effective retirement strategies for managing market volatility is implementing a guardrails system. The Guyton-Klinger framework provides a structured approach to adjusting your spending during market downturns.

Here’s how it works:

If your withdrawal rate increases by 20% due to portfolio losses (not increased spending), you implement a 10% reduction in your expenses.

For many retirees, this strategy is quite manageable because they often have significant discretionary spending. Instead of taking three major trips per year, you might reduce it to two. While this requires some lifestyle adjustment, it’s far better than running out of money entirely.

The beauty of this approach is that it’s not arbitrary. It’s based on historical analysis of what works during extended market downturns. This systematic approach to managing market volatility helps remove emotion from financial decisions during stressful periods.

Building Your Cash and Fixed Income Buffer

Another crucial element of sound investment strategies for retirement is maintaining adequate liquidity. Building up a substantial cash and fixed income buffer allows you to avoid selling stocks during market downturns. This strategy proved invaluable during the 2008-2009 crisis, which took about 5 years for the market to fully recover.

The question isn’t whether to build this buffer, but how large it should be. Some retirees feel comfortable with two years of expenses in cash and fixed income. Others prefer four or five years for maximum peace of mind. This decision depends on your risk tolerance and how much market volatility you can psychologically handle.

Your buffer can include money market accounts, high-yield savings, CDs, short-term treasuries, or a combination of these vehicles. The key is having enough liquid assets to cover your expenses without forcing you to sell stocks at the worst possible time. This approach allows your equity investments time to recover while you live off your safer assets.

Reconsidering Annuities in Your Portfolio

Many people have negative associations with annuities, often for good reasons, given how they’ve been oversold in the past. However, when used appropriately, annuities can serve as an effective tool for managing market volatility in retirement portfolios.

The advantage of fixed annuities over traditional bonds is the elimination of interest rate risk. While bond prices can decline when interest rates rise, a fixed annuity locks in your value each year. More importantly, annuities can be converted into guaranteed lifetime income streams, which reduces the pressure to sell stocks during market downturns.

This is particularly relevant for managing market volatility. Why? Because it provides a foundation of guaranteed income that doesn’t fluctuate with market conditions. Whether you’re considering a private annuity from companies like Lincoln or Principal, or you have access to institutional options like TIAA, these tools can provide valuable stability during uncertain times.

Alternative Income Strategies

Sometimes the best retirement strategies involve thinking outside traditional investment approaches. Part-time work, for instance, can significantly reduce pressure on your investment portfolio during volatile periods. This doesn’t mean returning to a stressful full-time career, but rather finding enjoyable, flexible work that provides additional income.

Many retirees find fulfillment in consulting work, retail positions, or service jobs that keep them active and social while providing financial benefits. The additional income reduces the amount you need to withdraw from your portfolio, giving your investments more time to recover from market downturns.

Strategic Social Security Timing

Your Social Security claiming strategy can also serve as a tool for managing market volatility. If you had planned to delay benefits until age 70 but find yourself in a prolonged market downturn, claiming earlier can reduce pressure on your investment portfolio.

There’s even a little-known provision that allows you to start Social Security benefits before full retirement age, but then stop them at full retirement age.  This allows you to capture delayed retirement credits up until age 70. This flexibility can be valuable if market conditions improve and you want to return to your original strategy of maximizing lifetime benefits.

The DURP Framework: Staying Disciplined During Uncertainty

The foundation of all effective retirement strategies is what I call the DURP framework: Disciplined, Unemotional, Repeatable Process. This approach is based on having a clear investment policy statement that guides your decisions regardless of market conditions.

Think of how major university endowments operate. They have clear goals, defined risk tolerance based on those goals, and specific asset allocation targets. When they need to generate cash flow, they sell from whatever asset class has performed best recently and is overweight in their portfolio.

During strong market years like 2025, when stocks returned about 16%, and bonds returned 7%, you would trim your equity allocation to generate additional cash flow. Conversely, during down markets like 2008, when stocks fell 37%, but bonds gained 6%, you could sell bonds to meet your cash flow needs while allowing stocks time to recover.

This systematic approach to managing market volatility removes emotion from the equation. It ensures that you’re buying low and selling high rather than the other way around.

What is Retirement Planning in Today’s Environment?

What is retirement planning in an era of increased market volatility and geopolitical uncertainty? It’s about creating flexible, robust strategies that can adapt to changing conditions while protecting your financial security.

Modern retirement planning must account for longer lifespans, lower expected returns, higher healthcare costs, and increased market volatility. It’s no longer sufficient to simply accumulate assets and hope for the best. Today’s retirees need sophisticated strategies that address sequence-of-returns risk, inflation protection, and income sustainability.

The key is to work with professionals who understand these complexities and can help you implement appropriate strategies before you need them. This can include:

  • Setting up guardrails
  • Building proper cash buffers
  • Optimizing your Social Security strategy

The time to plan is before the crisis hits.

Moving Forward with Confidence

While the current market volatility related to the Iran conflict is concerning, it’s important to remember that markets have weathered similar storms before. The key is having proper retirement strategies in place and the discipline to stick with them during challenging periods.

If you’re approaching retirement with over a million dollars in savings and feeling uncertain about how to navigate these turbulent times, you’re not alone. The strategies outlined here—from guardrails frameworks to cash buffers to strategic Social Security timing—have helped countless retirees successfully navigate market volatility.

The most important thing is to avoid making emotional decisions based on short-term market movements. Instead, focus on building a robust plan that can adapt to changing conditions while protecting your long-term financial security. Remember, you can’t time the markets perfectly. However, you can prepare for volatility and position yourself to weather whatever storms may come.

Managing market volatility in retirement isn’t about predicting the future. It’s about being prepared for multiple scenarios and having the flexibility to adapt as conditions change. With proper planning and professional guidance, you can maintain confidence in your financial future regardless of what global events may unfold.

At Imagine Financial Security, we help individuals over 50 with at least a million dollars saved navigate these complex retirement decisions. If you are looking to

  • Maximize your retirement spending
  • Minimize your lifetime tax bill
  • Worry less about money

You can start by taking our Retirement Readiness Questionnaire on our website at www.imaginefinancialsecurity.com, so we can learn more about how we can help you on your journey to and through retirement.

Not quite ready to take the questionnaire, but want helpful tips and resources? Sign up for our monthly newsletter and/or subscribe to our YouTube channel. This is for general education purposes only and should not be considered as tax, legal, or investment advice.

One More Year Syndrome: The Hidden Trap Keeping You from Retirement

If you’ve been researching retirement lately, you’ve probably encountered content about something called “one more year syndrome.” This concept has been gaining traction across YouTube channels, podcasts, and financial forums, but what exactly is it, and why should you care?

One more year syndrome describes the tendency for pre-retirees to continuously postpone their retirement by convincing themselves they need to work “just one more year.” Sound familiar? You’re not alone. This pattern affects countless people who are financially ready to retire but keep finding reasons to delay.

What Is One More Year Syndrome?

One more year syndrome occurs when you give yourself excuses to work another year, even though you have the financial capacity to retire. These excuses might sound like:

  • “I need to add more money to my portfolio.”
  • “The market valuations look scary right now.”
  • “Inflation is making me nervous.”
  • “There are tariffs looming on the horizon.”
  • “Healthcare costs before Medicare eligibility worry me.”
  • “I don’t know what I’ll do with my time in retirement.”

The truth is, there’s always something uncertain on the horizon. Think about any time you’ve challenged yourself to try something new – that feeling of unease before stepping into uncharted territory is completely natural. Just like a child reciting a poem in front of their peers feels terrified for weeks beforehand, but once they’re doing it, they realize it wasn’t so scary after all.

For many pre-retirees, you’ve spent your career being the go-to person. You’re the problem solver, the one putting out fires, the person others turn to for advice and help. You have meaning, purpose, and respect in your field and community. The idea of leaving that behind for an uncertain next chapter can feel genuinely frightening.

Understanding the Content Creator’s Angle in Retirement Planning

Here’s something important you need to understand: many people creating content about one more year syndrome are retirement planners and financial advisors. They want people to retire, or at least seriously consider retiring soon, because that creates business opportunities for them.  This is coming from a fellow content creator and retirement planner!  (At least I’m upfront about it).

This doesn’t mean their advice is wrong, but you need to understand the incentive structure. When you see content saying, “don’t work another year, you’re wasting your time, stop slaving away for the man,” ask yourself who is packaging that message and what their angle might be.

Every content creator has an angle. The key is being aware of where the content is coming from so you can evaluate it appropriately. This awareness doesn’t invalidate the message – it might still be exactly what you need to hear – but it helps you consume it more thoughtfully.

Why Mortality Makes Us Rethink When to Retire

Sometimes life provides wake-up calls that force us to reconsider our retirement timing. Recently, a podcast listener reached out to see if he could retire earlier than he had planned.  The reason?  He lost 3 of his close friends over the last year. That kind of mortality reminder hits differently than abstract retirement planning discussions.

I remember back in my TIAA days, I worked with a sweet math professor looking for help with retirement planning.  She planned to work until 65 to become eligible for Medicare, and she was incredibly excited about traveling the world. For three years, her excitement built with each planning meeting. Then, unexpectedly, she passed away at 64 – just months before her planned retirement.

These stories aren’t meant to create fear, but they highlight an important reality: time isn’t guaranteed. When you see people around you pass away, get sick, or become frail, it naturally makes you reevaluate what you’re doing today. This response is completely normal and healthy.

Three Questions to Evaluate Your Retirement Readiness

To address one more year syndrome effectively, ask yourself these three critical questions:

Question 1: The Financial Standstill Test

Assuming nothing changed financially over the next year – even if the markets didn’t cooperate and your portfolio balance stayed exactly the same 12 months from now – would you still work that one more year?

What if you had a crystal ball showing your net worth wouldn’t change despite working another year, would you still choose to work? If the only reason you’re working is to add more money to your portfolio, even though you already have the capacity to retire today, you might be suffering from one more year syndrome.

Question 2: The Money-No-Object Test

If money weren’t an issue and you didn’t need to add more to your portfolio, would you still be doing what you’re doing today?

Remember, retirement doesn’t have to mean sitting in a rocking chair sipping drinks all day. Maybe you’d work occasionally as a consultant, volunteer, travel, or start a nonprofit. But the question is: if you didn’t need your job financially, would you still choose to spend most of your day and week doing that job?

If the answer is yes, and you can still pursue other important activities and relationships, then keep working. But remember – nothing is guaranteed.

Question 3: The Five-Year Horizon Test

If you were told today that you had five more good, healthy “go-go” years left, would you still work that one more year?

How would this knowledge change your decision about working another year?

Finding Purpose Beyond Traditional Retirement

The concern about losing purpose in retirement is valid and important. In 1 Peter 4:10, it says, “Each one should use whatever gift he has received to serve others, faithfully administering God’s grace in its various forms.”

This doesn’t suggest that retirement is bad; rather, it asks whether you’re using your gifts to serve others. If work is preventing you from doing that, maybe you should consider retiring sooner than planned. However, if you have no purpose planned for retirement, you’re likely to feel lost.

Retirees who feel lost don’t feel good, and people who don’t feel good aren’t enjoyable to be around. You need purpose, meaning, fulfillment, and energy in retirement. But there are many ways to make an impact and put your time, talents, and treasures to work beyond traditional employment.

Making Your Decision About One More Year Syndrome

Here’s what to take away from this discussion:

First, when you encounter content about one more year syndrome, understand where it’s coming from. Consider who is delivering the message, how they’re packaging it, and what their angle might be. Everyone has motivations, and being aware of them helps you evaluate advice more effectively.

Second, recognize that despite potential biases, this message might still be exactly what you need to hear today. Time isn’t guaranteed, and you can’t predict how many good years you have remaining. This reality has played out countless times throughout retirement planning careers.

Third, use those three questions to guide your thinking. They might lead you to conclude that you should continue working – maybe for five more years instead of one. Or you might realize you hate what you’re doing and need to figure out a plan to transition now, even if it’s not full retirement.

If money isn’t the issue and you dislike your job, it’s probably time to reevaluate what you’re doing. There are plenty of ways to make an impact and use your skills meaningfully.

Moving Forward with Your Retirement Decision

One more year syndrome is real, and it affects many people who are actually ready to retire but keep finding reasons to delay. The key is honest self-reflection about your true motivations.

Are you working another year because you genuinely need the money, or because you’re afraid of the unknown? Do you love what you do and find meaning in it, or are you staying because it feels safe and familiar?

Your retirement planning should go beyond financial calculations to include questions of purpose, meaning, and how you want to spend your remaining healthy years. Whether you decide to retire now, work one more year, or continue for several more years, make sure that decision is based on thoughtful consideration rather than fear or habit.

The goal isn’t to minimize your retirement years but to maximize the meaningful use of whatever time you have left. Sometimes that means working longer, and sometimes it means taking the leap into retirement sooner than you initially planned.

At Imagine Financial Security, we help individuals over 50 with at least a million dollars saved navigate these complex retirement decisions. If you are looking to

  • Maximize your retirement spending
  • Minimize your lifetime tax bill
  • Worry less about money

You can start by taking our Retirement Readiness Questionnaire on our website at www.imaginefinancialsecurity.com, so we can learn more about how we can help you on your journey to and through retirement.

Not quite ready to take the questionnaire, but want helpful tips and resources? Sign up for our monthly newsletter and/or subscribe to our YouTube channel. This is for general education purposes only and should not be considered as tax, legal, or investment advice.

Ep. 121: 5 Tax Planning Strategies When You’re High Net Worth, but Poor on Paper

After you retire, you might find your net worth continuing to grow, but your ‘taxable income’ drops significantly. That can create major tax planning opportunities. Hence, ‘High net worth, poor on paper.’

I’ll explain how that period of time can open the door to smarter planning around ACA subsidies, Roth conversions, Social Security taxation, and 0% capital gains harvesting.

Remember, these strategies should not be looked at in a silo. A move that helps in one area can easily impact another if it isn’t coordinated with your full retirement plan.

What you’ll learn in this episode:

  • What “high net worth, poor on paper” actually means
  • Why low-income years in retirement can be powerful planning years
  • How ACA premium tax credits work for early retirees
  • The tradeoff between ACA subsidies and Roth conversions
  • How the Roth conversion window can reduce future RMD problems
  • How Social Security taxation can potentially be reduced with proper timing
  • When 0% capital gains harvesting may make sense
  • Why these strategies must be coordinated, not implemented one by one
  • Why retirement tax planning is about timing taxes wisely, not just avoiding them

Resources / related episodes:
ACA Tax Credits:  The Cliff is Back in 2026:  

$3m Net Worth, Free Healthcare(case study): 

Aggressive Conversions to makeSocial Security Tax Free: 

Thank you for listening!

-Kevin

Are you interested in working with me 1 on 1?⁠⁠⁠⁠⁠⁠⁠⁠ 

⁠⁠⁠⁠⁠⁠⁠⁠You can start with our Retirement Readiness Questionnaire linked on our website so we can learn more about how we can help in your journey to and through retirement.

Connect with me here:

Or, ⁠⁠⁠⁠⁠⁠⁠⁠visit my website

This is for general education purposes only and should not be considered as tax, legal, or investment advice.

Ep. 120: 5 Retirement Strategies to Protect Your Portfolio During the Iran Oil Crisis

Are you retiring soon or recently retired and worried about market volatility, sequence of returns risk, and what the Iran conflict could mean for your plans?

In this episode, I’m diving into what retirees should be considering as we head into potential prolonged volatility.

I’ll discuss the short term market impact of the conflict.

Then, I’ll touch on what I think might be an underlying long-term goal for the US getting involved.

And most importantly, we’ll touch on 5 strategies to help you prepare for and execute a successful retirement, despite this new wave of uncertainty. I hope it helps!

-Kevin

Are you interested in working with me 1 on 1?⁠⁠⁠⁠⁠⁠⁠⁠ 

⁠⁠⁠⁠⁠⁠⁠⁠You can start with our Retirement Readiness Questionnaire linked on our website so we can learn more about how we can help in your journey to and through retirement.

Connect with me here:

Or, ⁠⁠⁠⁠⁠⁠⁠⁠visit my website

This is for general education purposes only and should not be considered as tax, legal, or investment advice.

Should You Annuitize in Retirement?  4 Surprising Truths About Annuities

Let me start with complete transparency: I don’t sell annuities, I don’t receive commissions from them, and frankly, I dislike most annuity products on the market. They’re often complicated, expensive, and in many cases, they’re sold rather than planned.

My skepticism runs deep. Nearly 18 years ago, in my first financial role out of college, there was a veteran in my office who had one solution for everything: annuities. Client had an IRA rollover? Annuity. Extra money beyond their 401 (k)? Annuity. Worried about market volatility? You guessed it – annuity. This approach made me sick and shaped my career trajectory as a fee-only planner.

But this isn’t about bashing annuities like Ken Fisher does. When used correctly – specifically when used the way they were designed to be used – annuities can create outcomes that surprise even sophisticated investors and retirees. After 17-18 years of retirement planning, I’ve learned that bringing bias to the table and simply saying “annuities are bad” isn’t helpful.

Today, I want to walk you through four surprising benefits of annuitizing a portion of your fixed income and how this fits into well-designed retirement income planning.

The big takeaway? Retirement planning isn’t just about growing assets anymore – it’s about turning those assets into reliable, efficient, and sustainable income.

1. Lower Stress During Market Volatility: The Emotional Game-Changer

Here’s something most people don’t understand until they experience it firsthand: having an annuitized portion of your portfolio dramatically reduces stress during market downturns in retirement.

Consider this reality: if you retire at 60 and plan to live until 90, that’s a 30-year time horizon. Historically, there’s a 20% market downturn or bear market approximately once every five years. This means you could experience five or even six major bear markets during your retirement.

Bear markets hit differently when you’re retired.

When you’re accumulating wealth, you might even feel somewhat positive about a bear market – subconsciously, you know you’re buying shares at discounted prices. It’s uncomfortable, but manageable. When you’re withdrawing money for living expenses, volatility can feel nauseating.

I’ve been working with retirees for 18 years. In that time, I’ve witnessed very sophisticated retirees panic during downturns by bailing out of well-thought-out, diversified strategies right in the middle of a bear market. I’ve watched vacations get ruined, and couples argue over whether they should cut spending during market downturns.

But here’s what I’ve never seen:

I’ve never had a client with guaranteed lifetime income layered on top of other income sources – whether Social Security or a pension – say they regret securing that income stream. It’s always the opposite.

During COVID in 2020, during the 2022 downturn, and going back to 2008, when markets dropped 20% or more, clients with annuitized income consistently told me: “I’m so glad I have that guaranteed income check showing up every month.”

That predictability changes behavior, and in retirement, behavior matters infinitely more than spreadsheets.

Yes, you can hold bonds or cash for safety, but 2022 reminded us that bonds can fall double digits, and cash loses purchasing power over time. Your safe money isn’t about maximizing returns – it’s about minimizing emotional risk. And emotional risk in retirement is incredibly expensive.

2. Reduced Withdrawal Pressure: The Mathematical Advantage

This is where the math really shines, and it’s one of my favorite impacts of annuitization.

Most retirees follow traditional withdrawal frameworks. Let’s use the 4% rule as an example. Say you have $2 million invested and need $80,000 annually – that’s exactly 4%, which should theoretically work fine.

Now let’s see what happens with partial annuitization:

Instead of relying solely on systematic withdrawals, let’s say you annuitize $500,000 of your fixed income allocation. Using a conservative 7% payout rate (and I’ll explain why this is conservative in a moment), that $500,000 generates $35,000 annually in guaranteed income.

Your remaining portfolio balance is now $1.5 million, but it only needs to produce $45,000 because you’re receiving $35,000 from the lifetime income stream. Divide $45,000 by $1.5 million, and you get an effective 3% withdrawal rate on the remaining portfolio.  That reduced withdrawal rate on the invested balance could allow for better long-term growth, all because you maximized the cash flows from your ‘safe bucket.’ 

That difference matters enormously over the long term.

Why can annuities offer higher payout rates than bonds? Two reasons: mortality credits and longevity pooling. You’re not just earning bond-like returns – you’re benefiting from pooled longevity risk. Some people in the pool won’t live very long; others will live much longer. This pooling effect creates higher payout rates than you could achieve with individual bonds or CDs.

I broke down Marilyn’s real case study on YouTube: She was earning approximately 8.6% on her TIAA traditional annuity – well above the conservative 7% I used in the example above.

Surprisingly, partial annuitization increased the ending ‘legacy’ to her two adult children!  Despite dropping her liquidity after annuitizing that portion of her assets.

This higher payout rate reduces strain on your equity portfolio, which means:

  • Lower sequence of returns risk
  • Fewer forced sales during market downturns
  • More compounding potential for long-term growth

Annuities don’t just create income – they reduce selling pressure on everything else. This structural shift is often misunderstood but incredibly powerful.

The timing of this strategy matters significantly. We’ve had three consecutive years of bull market returns – double digits in the 20% range for two years, then 16% last year. But who knows how much longer this will continue?

We had about 11-12 years between 2008 and 2020 with minimal bear markets, but then just a two-year gap before the 2022 downturn. Markets are cyclical, and short-term, they’re driven by emotion and irrationality.

The question is:

  1. What’s your plan for the next bear market?
  2. Can partial annuitization help you navigate it emotionally while avoiding the need to sell riskier assets with better long-term growth potential?

3. Higher Legacy Potential: The Counterintuitive Truth

This surprises people more than anything else, and honestly, it shocked me initially, too. I spent considerable time manipulating financial planning software because I didn’t believe the results. But the math is sound and makes perfect sense once you understand it.

Annuitizing a portion of your assets can actually result in higher legacy amounts, not lower ones.

This shocks people because the common assumption is: “If I annuitize, my kids lose out because that money isn’t liquid anymore.” While liquidity does disappear with annuitization, if longevity plays out in your favor – which is the entire purpose of annuitization – the results can be dramatically different.

Here’s why: If you plan to live into your 80s or 90s, the annuity keeps paying throughout that entire period. Meanwhile, because you’ve reduced withdrawal pressure on your equity portfolio, those riskier assets with higher long-term growth potential can compound more efficiently.

In stress tests I’ve run with real case studies, including Marilyn’s situation, the numbers consistently support this outcome. For Marilyn, the breakeven point was approximately 81 years old. Beyond that point, the legacy outcome was significantly higher with partial annuitization than without it.

Legacy’s biggest threat

The biggest threat to legacy isn’t annuitization – it’s poor returns early in retirement. Poor sequence of returns risk combined with higher withdrawals damages portfolios far more than partial annuitization ever could.

If you retire into a bear market, the value of reduced withdrawal strain becomes even more powerful. I’ve seen this play out with clients who annuitized portions of their portfolios 10-15 years ago. They’ve been able to take full advantage of the bull run we’ve enjoyed since 2008, with their remaining investments growing much more efficiently because they weren’t forced to sell during downturns.

4. True Longevity Insurance: Beyond Social Security and Bonds

Most retirees over-allocate to bonds because they fear volatility. But bonds don’t solve longevity risk – they just reduce volatility temporarily.

If you live 25 or 30 years in retirement, how long will that safe bond allocation actually last?

Longevity risk is particularly real for people who take care of themselves, have good genetics, and access to excellent healthcare. As modern medicine continues to evolve and AI advances rapidly, life expectancies may increase significantly. Even if the most optimistic predictions don’t materialize, many people will still live well into their 90s or beyond.

Social Security provides powerful longevity insurance, but for many high-income retirees, it won’t cover enough expenses. This is where partial annuitization becomes valuable – it can convert part of that underutilized fixed income allocation into maximized income streams that protect against longevity risk.

The annuity will pay whether you live to 85 or 105.

I see the bond or fixed income bucket consistently underutilized by retirees. People are often afraid to commit large lump sums to annuities because liquidity disappears. This is exactly why having a comprehensive plan and strategy is crucial – this isn’t an all-or-nothing decision.

Liquidity matters. Health matters. Legacy goals matter. Interest rates, payout rates, specific annuity contracts, and terms all matter significantly.

This isn’t about annuitizing everything – it’s about intelligently designing the fixed income sleeve of your portfolio, building an income floor, creating emotional stability, and giving growth assets room to compound. That’s true retirement income planning.

Four Critical Questions to Ask Yourself

If you’re approaching retirement or recently retired and wondering whether partial annuitization makes sense, consider these four questions:

1. What is my true risk tolerance in retirement?

Really internalize this. How do you actually feel about risk – not today while you’re still working, but when you’re actually retired and watching your portfolio fluctuate? If you are retired, how do you feel when the market drops 10%, 20%, or even 30%?

2. Do I expect longevity in my family?

Consider both yourself and your spouse. Do you have good genetics, take care of your health, and have access to quality healthcare? Are you planning for the possibility of living 25, 30, or more years in retirement?

3. What percentage of my expenses are covered by guaranteed income sources?

If Social Security only covers 25% of your total expenses, that’s not substantial coverage. You could be much more subject to the sequence of returns risk than someone with higher guaranteed income coverage.

4. Am I reacting emotionally to the word “annuity,” or am I evaluating strategically?

Are you considering annuities as part of an overall retirement income plan, or are you dismissing them based on preconceived notions?

If your income stability ratio is low – meaning most expenses must come from portfolio withdrawals – you’re much more exposed to sequence risk. This doesn’t automatically mean you need annuities, but it absolutely means you should evaluate them objectively.

This is especially true if you have access to quality annuities, such as TIAA traditional products, where older vintages can offer very attractive payout rates. Before surrendering or transferring these products, understand the crediting rates, liquidity restrictions, income options, and payout rates.

The Bottom Line: Building Resilient Retirement Income

Retirement income planning isn’t about collecting the highest returns – it’s about building a resilient retirement income plan that can weather various economic storms while providing the lifestyle you want.

People who succeed in retirement aren’t those chasing performance; they’re the ones who design their plans intelligently, balancing growth potential with income security.

The mathematical advantages of partial annuitization – reduced withdrawal pressure, higher effective payout rates through mortality credits, potential legacy benefits, and true longevity protection – can create outcomes that surprise even sophisticated investors.

But remember: this strategy requires careful planning, appropriate product selection, and integration with your overall financial plan. The goal isn’t to annuitize everything, but to strategically design your fixed-income allocation to deliver maximum benefit across all your retirement objectives.

As we face potential market volatility ahead – with tariff uncertainties and the conflict in Iran – having a portion of your income guaranteed can provide the emotional stability needed to let your growth investments do what they do best: grow over time.

The question isn’t whether annuities are good or bad in isolation. The question is whether partial annuitization can help you build a more resilient, less stressful, and ultimately more successful retirement income plan.

At Imagine Financial Security, we help individuals over 50 with at least a million dollars saved navigate these complex retirement decisions. If you are looking to

  • Maximize your retirement spending
  • Minimize your lifetime tax bill
  • Worry less about money

You can start by taking our Retirement Readiness Questionnaire on our website at www.imaginefinancialsecurity.com, so we can learn more about how we can help you on your journey to and through retirement.

Not quite ready to take the questionnaire, but want helpful tips and resources? Sign up for our monthly newsletter and/or subscribe to our YouTube channel.

This is for general education purposes only and should not be considered as tax, legal, or investment advice.

Ep. 119: Social Security for Married Couples: The Survivor Benefit Mistake

If you’re married, your Social Security claiming strategy is not just about your benefit — it’s about protecting your spouse’s income for life. In this video, I’ll explain the most overlooked Social Security rule for married couples and how it can dramatically affect the surviving spouse’s financial security.

Many retirees don’t realize that when one spouse passes away, one Social Security check disappears. The surviving spouse only keeps the larger of the two benefits, which means the higher earner’s claiming decision may be the most important Social Security decision you make.

Using a real-life style example, we’ll walk through how delaying Social Security can significantly increase the survivor benefit, potentially adding thousands of dollars per month for the spouse who lives the longest. I’ll also explain why couples who claim too early may unintentionally reduce the surviving spouse’s income during the most financially vulnerable years of retirement.

However, this strategy doesn’t apply to everyone. I’ll also share three situations where it may actually make sense to ignore the typical advice to delay Social Security, including health considerations, investment strategies, and withdrawal rate concerns.

If you are within 5–10 years of retirement, married, and have saved $1M or more, this Social Security strategy could have a major impact on your long-term retirement income plan.

Enjoy the episode!

~Kevin

Are you interested in working with me 1 on 1?⁠⁠⁠⁠⁠⁠⁠⁠ 

⁠⁠⁠⁠⁠⁠⁠⁠You can start with our Retirement Readiness Questionnaire linked on our website so we can learn more about how we can help in your journey to and through retirement.

Connect with me here:

Or, ⁠⁠⁠⁠⁠⁠⁠⁠visit my website

This is for general education purposes only and should not be considered as tax, legal, or investment advice.

Ep. 118: Should You Annuitize in Retirement?

Are annuities really that bad?

I’ve spent most of my career skeptical of annuities.  Especially the expensive, complicated products often sold to retirees. I don’t sell annuities. I don’t earn commissions from them. And in most cases, I still am skeptical of how they are ‘sold’and not planned for.

In this episode, I break down four surprising benefits of annuitizing part of your fixed income, especially if you’re approaching retirement with $1M+ saved and want a smarter retirement income strategy.

We’ll cover:

• Why everyone is a bull… until the market drops 10%
• How annuitization can reduce sequence of returns risk
• Why payout rates (like 6%–8%+) is hard to replicate with a ‘safe withdrawal rate’
• How annuities can actually improve legacy outcomes in certain scenarios
• The math behind lowering withdrawal pressure on your equity portfolio
• How to evaluate TIAA Traditional payout options and vintages

Retirement isn’t just about asset allocation.

It’s about income design.

And if you’re over 55, retiring soon, or already retired, understanding annuitization could materially impact your retirement income, stress level, and long-term legacy. Hope you find this useful.

-Kevin

Are you interested in working with me 1 on 1?⁠⁠⁠⁠⁠⁠⁠⁠ 

⁠⁠⁠⁠⁠⁠⁠⁠You can start with our Retirement Readiness Questionnaire linked on our website so we can learn more about how we can help in your journey to and through retirement.

Connect with me here:

Or, ⁠⁠⁠⁠⁠⁠⁠⁠visit my website

This is for general education purposes only and should not be considered as tax, legal, or investment advice.

Retirement Planning Opportunities If You’re in the Top 20% of Savers (Ages 55–70)

If you’ve ever Googled “retirement savings by age,” you’ve probably seen those benchmark numbers that either made you panic or feel like you’re crushing it. But here’s the thing – both reactions might be completely wrong.

Understanding retirement savings by age is something many people get hung up on, but the reality is that these average numbers rarely tell the complete story. Today, we’ll dive into real data from major financial institutions and explain why, if you’re reading this, you’re probably already in the top tier of savers.  And if you’re in that top tier, we’ll discuss specific planning opportunities to help you optimize your retirement. 

What the Average Retirement Savings Data Really Shows

Let’s start by looking at what the major studies actually reveal about retirement account balances across different age groups.

401k Balance by Age: Fidelity’s Latest Numbers

Fidelity releases quarterly benchmarking studies that track average retirement account balances by age. Their data shows that for people in their peak earning years (55-70), the average 401(k) balance hovers around $250,000.

Financial planner in Chattanooga, TN

But here’s the problem with this data: it only includes accounts held at Fidelity. It completely excludes external accounts, creating a major blind spot. There are no taxable brokerage accounts, no HSAs, and no retirement accounts held at other institutions, such as Vanguard or Schwab. This means Fidelity’s numbers aren’t really representative of the entire U.S. retirement landscape – especially not for people who are serious about their financial planning.

The Federal Reserve’s Complete Picture

The Federal Reserve’s Survey of Consumer Finances, conducted every few years, gives us the closest thing to a national financial scoreboard. The 2022 data reveals some eye-opening statistics.

For households in the 55-64 age range:

  • About 8% have retirement account balances between $500,000 and $1 million
  • Roughly 9% have over $1 million in retirement accounts
  • This means approximately 17% of U.S. households in this age group have retirement savings exceeding $500,000

If you’re reading this article and have accumulated at least $500,000 in retirement accounts by your late 50s or early 60s, you’re already in the top 20% nationally. Many readers are likely in that top 10% tier with over a million dollars saved.

The Fed’s survey includes a broad sample of American households – from lower wealth to middle class to high net worth families. Many of the households surveyed may have very little, if any, assets in 401(k)s or IRAs, which skews the averages significantly lower.

Empower’s More Complete Data Set

Empower’s data provides both average and median retirement account balances, which matters because averages can be skewed by ultra-high savers with multiple seven-figure accounts.

For people in their 50s and 60s, Empower shows:

  • Average retirement account balance: roughly $1 million
  • Median balance: about 50% of that average

What makes Empower’s data more valuable is that it doesn’t just include accounts held directly with them. It also incorporates retirement accounts imported through their personal dashboard tool. If someone has accounts at Fidelity, Vanguard, or other institutions, those balances get aggregated into the study, making it more representative of people who actively manage their finances across multiple platforms.

However, even Empower’s data has limitations – it still doesn’t include other retirement assets like taxable brokerage accounts, business investments, or real estate.

Why You’re Probably Not Average

Here’s the reality: if you’re actively researching retirement savings by age and reading detailed financial content, you’re already demonstrating behavior that puts you in a completely different category than the “average” American saver.

The average retirement savings by age data includes everyone, including people who have never opened a 401(k), those who cash out their retirement accounts when changing jobs, and households that prioritize other financial goals over retirement savings.

But you’re different. You’re likely someone who:

  • Has built substantial retirement account balances
  • Maintains accounts across multiple institutions
  • Has diversified beyond just retirement accounts into taxable investments
  • Owns real estate or business assets not captured in these studies

Someone might have $400,000 in a 401(k), but another $1-2 million in taxable brokerage accounts or $3 million in real estate investments. If you’re only comparing retirement accounts, you’re missing half the picture.

This is the key point: if you’re consuming this type of content, you’re probably already in that top 20% of households. You’ve likely saved at least $500,000, and many readers have accumulated seven figures or even multiple seven figures for retirement. You’re playing a completely different retirement game than the average American.

Essential Retirement Planning Strategies for Top-Tier Savers

When you’re in the top tier of savers, your biggest risk isn’t running out of money – it’s retirement planning inefficiency. Here are the critical strategies you need to consider:

Tax Planning: Your Biggest Opportunity

Taxes can actually be one of your biggest expenses in retirement – often ranking as the number one, two, or three largest annual expenses for retirees.

Large pre-tax account balances mean large future required minimum distributions (RMDs). These large RMDs can potentially push you into higher income tax brackets, trigger higher taxes on Social Security income, increase capital gains rates, and activate other hidden taxes. These tax hits compound over time.

If you retire early, you may have lower income years before RMDs kick in at age 73 or 75. This window represents one of the best tax planning opportunities of your lifetime–what’s called the “Roth conversion window.”

Maximizing Roth Conversion Strategies in Early Retirement

During your early retirement years, before RMDs begin, you have the opportunity to strategically convert pre-tax retirement funds to Roth accounts. This means paying taxes now at potentially lower rates to minimize the impact of those ballooning RMDs later.

Roth conversion strategies can also help you:

  • Minimize IRMAA surcharges (hidden taxes on Medicare premiums based on income)
  • Make Social Security income more tax-efficient
  • Create tax-free legacy assets for your heirs

Once this conversion window closes, it shuts for good, making this timing critical for long-term tax efficiency.

Optimizing Your Retirement Withdrawal Strategies

When you have substantial assets across multiple account types–taxable accounts, tax-deferred accounts, and tax-free accounts–the order you withdraw money matters enormously for the longevity of your retirement plan.

The classic approach follows this sequence:

  1. Taxable accounts first
  2. Tax-deferred accounts second
  3. Tax-free accounts last

This default strategy makes sense for many people, but it’s not always optimal. Sometimes it makes more sense to tap Roth accounts first and let tax-deferred accounts continue compounding. Other times, a multi-pronged approach works best–taking baseline distributions from taxable accounts while filling remaining income needs from tax-deferred accounts, even before RMDs begin.

The key insight: retirement withdrawal strategies shouldn’t follow a one-size-fits-all approach. Each year brings a new tax situation that needs to be evaluated and optimized based on your specific circumstances.

Investment Strategy: Risk Capacity vs. Risk Tolerance

Most retirees and many financial advisors focus solely on risk tolerance–how aggressive you feel comfortable being emotionally. But for higher net worth households, we need to discuss something different: risk capacity.

Understanding the Difference

Risk tolerance is emotional and psychological. It’s about how you feel when the market drops 20%. Do you panic? Can you sleep well at night? Can you stay disciplined?

Risk capacity is different – it’s not about feelings, it’s about what your plan can mathematically survive. Can you afford to take on risk in retirement?

Here’s the counterintuitive part: a retiree with a smaller portfolio may actually have less risk capacity than someone with a larger balance.

A Real-World Example

Consider a retiree with $500,000 who needs $30,000 annually (6% withdrawal rate). If the market drops 25%, their portfolio becomes $375,000, but they still need that $30,000. Now their withdrawal rate jumps to 8% – entering the danger zone where retirement plans can fail due to the sequence of returns risk.

Compare this to someone with $2 million who needs $80,000 annually (4% withdrawal rate). If their portfolio drops 25% to $1.5 million, their withdrawal rate only increases to 5.3%. They have margin for error. They can reduce withdrawals, skip inflation adjustments, rebalance, or even take advantage of the downturn.

This is risk capacity: how much volatility can your plan absorb before forcing you to make bad financial decisions?

Where You Hold Investments Matters

Asset location is different from asset allocation. Asset allocation is what you’re invested in. It’s your mix of stocks, bonds, real estate, and cash. Asset location is where you hold those investments.

When you have substantial balances across taxable, tax-deferred, and tax-free accounts, where you locate specific investments can significantly impact your after-tax returns.

The Tax Drag Problem

Taxable accounts face ongoing tax drag. Investments may pay quarterly dividends, generate interest income, or distribute capital gains even when you’re not selling anything. When you’re in higher tax brackets, this drag becomes significant and represents one of the most overlooked ways wealth gets eroded–not from market performance, but from unnecessary taxes.

If your taxable account holds high-yield bonds, REITs, and high-turnover funds, you might pay substantial taxes annually even if you’re not spending that income. Meanwhile, your IRA and Roth accounts might be better locations for these less tax-efficient investments.

The goal of asset location is simple: ensure your taxable accounts aren’t dragging down your net after-tax returns. You don’t just need good performance. You need good after-tax performance. It’s not about what you earn; it’s about what you keep.

Legacy Planning for High-Net-Worth Families

If you’re in the top tier of savers, there’s a good chance you won’t spend down all your assets, even if your goal is to “die with zero.” This means you’re optimizing not just for lifetime income, but also for legacy–specifically, tax-efficient legacy.

This becomes especially important if your heirs are high earners themselves: doctors, entrepreneurs, attorneys, or other professionals. What you leave behind matters significantly.

Leaving a pre-tax IRA or 401 (k) to high-income beneficiaries creates a different tax impact than leaving a Roth account or a taxable brokerage account. The most effective planning involves being strategic about which assets to spend aggressively during your lifetime versus which to preserve for beneficiaries.

The Real Takeaway for Top-Tier Savers

If you’ve built substantial wealth and find yourself in the top 20% of U.S. households, your retirement plan is no longer about chasing returns or worrying about having “enough” money. Instead, your focus should shift to:

  • Maximizing retirement plan efficiency
  • Controlling the timing and tax impact of distributions
  • Minimizing lifetime taxes through strategic planning
  • Managing Medicare thresholds and IRMAA surcharges
  • Optimizing Social Security income timing and taxation
  • Taking advantage of Roth conversion windows
  • Planning for tax-efficient legacy transfer

Once you’ve done the hard part–saving and investing to reach financial independence–the game becomes about keeping more of what you’ve built. The strategies that got you to this point aren’t necessarily the same ones that will optimize your wealth throughout retirement.

The Bottom Line

Stop comparing yourself to average retirement savings by age. If you’re actively planning and have accumulated substantial assets, you’re already playing in a different league. Your focus should be on advanced strategies that maximize the efficiency of the wealth you’ve built, not on whether you’re “keeping up” with benchmarks that don’t reflect your reality.

Remember, retirement planning for high-net-worth individuals isn’t about accumulating more. It’s about optimizing what you have for the best possible outcomes throughout your retirement years and beyond.

At Imagine Financial Security, we help individuals over 50 with at least a million dollars saved navigate these complex retirement decisions. If you are looking to

  • Maximize your retirement spending
  • Minimize your lifetime tax bill
  • Worry less about money

You can start by taking our Retirement Readiness Questionnaire on our website at www.imaginefinancialsecurity.com, so we can learn more about how we can help you on your journey to and through retirement.

Not quite ready to take the questionnaire, but want helpful tips and resources? Sign up for our monthly newsletter and/or subscribe to our YouTube channel.

This is for general education purposes only and should not be considered as tax, legal, or investment advice.

Ep. 117: TIAA Traditional Explained: How Much to Keep, When to Use It, and What to Do at Retirement

If you’re a TIAA participant, there’s a good chance you own TIAA Traditional—and it may be one of the most misunderstood “investments” in retirement plans.

In this episode, I’m breaking down TIAA Traditional, TIAA Real Estate and answering the biggest questions I hear from TIAA participants:

✅ Should I own TIAA Traditional?
✅ If so, how much should I keep there?
✅ Should I use the TIAA Real Estate Account?
✅ What should I do with TIAA Traditional after I retire?
✅ Bonus: How do I compare to other retirement savers?

We’ll talk about the real issue most people miss—liquidity and contract type—and how TIAA Traditional can be used as a bond alternative or even as a retirement income floor depending on your plan.

Resources mentioned:

TIAA Real Estate Account

Video, How to get money OUT of TIAA (contract breakdown)

Video, Retirement Savings Relative to Peers

⛳ PFR Nation (Who This Is For)

If you’re over 50, have saved seven figures (or multiple seven figures), love golf and travel, and you want to make work optional while minimizing taxes… welcome to the right place.

💬 Comment Below

What is your biggest TIAA question?

Are you interested in working with me 1 on 1?⁠⁠⁠⁠⁠⁠⁠⁠ 

⁠⁠⁠⁠⁠⁠⁠⁠You can start with our Retirement Readiness Questionnaire linked on our website so we can learn more about how we can help in your journey to and through retirement.

Connect with me here:

Or, ⁠⁠⁠⁠⁠⁠⁠⁠visit my website

This is for general education purposes only and should not be considered as tax, legal, or investment advice.

Ep. 116: Are You Stuck in “One More Year Syndrome”?

Lately, I’ve been seeing a TON of retirement planning content telling people:

“Don’t work another year. Retire now. You’re wasting time.”

And honestly… as a retirement-focused financial planner, that message kind of rubs me the wrong way.

Not because it’s always wrong… but because I think there’s an angle behind it.

In today’s episode, we break down what One More Year Syndrome really is, why it’s become such a popular retirement planning trend on YouTube and podcasts, and why you may want to take this advice seriously… but also why you might need to take it with a grain of salt.

Because retirement isn’t just about sitting on the beach 7 days a week.

Retirement should be about purpose, meaning, freedom, and using your time, talents, and treasure in the way that matters most.

I also share a powerful story from a recent conversation with a prospective client who reached out after losing three of his closest friends last year, and how that kind of wake-up call can completely change the way you think about retirement timing.

At the end of this episode, I give you 3 questions to ask yourself to determine whether you’re truly delaying retirement for financial reasons… or if you’re simply afraid of stepping into the unknown.

If you’re in your 50s or early 60s, have saved $1M+ for retirement, and you’re wondering whether you should retire now or work longer, this episode is for you.

✅ Questions Covered In This Episode:

  • Should I retire now or work one more year?
  • Is One More Year Syndrome real?
  • How do I know if I’m financially ready to retire?
  • How do I find purpose after retirement?
  • What if I retire too early?
  • What if I wait too long and regret it?

⛳ PFR Nation (Who This Is For)

If you’re over 50, have saved seven figures (or multiple seven figures), love golf and travel, and you want to make work optional while minimizing taxes… welcome to the right place.

💬 Comment Below:

Are you stuck in “one more year syndrome”?

What’s holding you back from retiring today — taxes, market uncertainty, healthcare, or fear of the unknown?

I’d love to hear from real retirees and pre-retirees.

⁠⁠Are you interested in working with me 1 on 1?⁠⁠⁠⁠⁠⁠⁠⁠ 

⁠⁠⁠⁠⁠⁠⁠⁠You can start with our Retirement Readiness Questionnaire linked on our website, so we can learn more about how we can help in your journey to and through retirement.

Connect with me here:

Or, ⁠⁠⁠⁠⁠⁠⁠⁠visit my website

This is for general education purposes only and should not be considered as tax, legal, or investment advice.

info@imaginefinancialsecurity.com
(904) 323-2069

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