One of the questions we hear most often from people nearing retirement is, “do I have enough?” Usually, that question isn’t really about a dollar amount; it’s about whether they can travel, spoil the grandkids, enjoy the next chapter of life, and sleep well at night without constantly wondering if they’ll outlive their savings.
No one can predict exactly what retirement will look like. Markets rise and fall. Inflation changes the cost of living. Health needs evolve. Tax laws change. Over a retirement that may last 30 years or longer, a lot can happen. A good financial plan recognizes that uncertainty instead of ignoring it.
At BayView Private Wealth, we use retirement planning software that allows us to test thousands of possible market and economic scenarios. The goal isn’t to forecast what the next 30 years will look like; the goal is to understand how a retirement plan holds up under a wide range of conditions.
We use two different planning systems because each answers a different question: one focuses on whether your assets are likely to last throughout retirement whereas the other looks at how much spending flexibility you may have if markets don’t cooperate. Looking at both gives us a more complete picture before making recommendations.
Attention must also be given to how retirees spend money. Many financial plans assume spending stays the same year after year. That’s rarely what happens. Most retirees spend more during the early years when they’re traveling, pursuing hobbies, and making memories with family. Spending often slows as lifestyles become more settled, then rises later because of healthcare or long-term care expenses. Building those patterns into a retirement plan produces projections that better reflect real life.
The timing of market returns matters, too. Two retirees can earn the same average return over several decades and still have very different outcomes. A significant market decline during the first few years of retirement can do much more damage than an identical decline that occurs 20 years later because withdrawals are already reducing the portfolio.
For that reason, we also compare retirement plans against actual historical market environments including recessions, inflationary periods, and major bear markets. History doesn’t repeat perfectly, but it provides valuable perspective on how a plan may respond when conditions become challenging.
Retirement planning should continue long after your last paycheck. Reviewing income strategies, taxes, withdrawals, and investment allocations over time can make a meaningful difference. Our objective is simple – we want our clients to enjoy the wealth they spent a lifetime building while knowing they have a thoughtful plan behind every major financial decision.
Advisory services offered by Investment Advisory Representatives of RFG Advisory, LLC (“RFG Advisory” or “RFG”), a registered investment advisor. BayView Private Wealth and RFG Advisory are unaffiliated entities. Advisory services are only offered to clients or prospective clients where RFG Advisory and its representatives are properly licensed or exempt from licensure. No advisory services may be rendered by RFG Advisory unless a client agreement is in place.
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