A 4-Step Anxiety-Reducing Retirement Road Map

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Retirement planning can feel overwhelming, with its many moving parts and decisions. You shouldn't have to figure it all out alone.

That's why I developed the R.I.S.E. Retirement Roadmap, a four-step process that helps families navigate the retirement journey with clarity and confidence.

R.I.S.E. stands for:

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Review
Identify
Strategize
Execute

This covers everything from taking stock of your finances to putting a plan into action and adjusting it along the way.

About Adviser Intel

The author of this article is a participant in Kiplinger's Adviser Intel program, a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

Regardless of the financial adviser you work with, here's the process I've found extremely helpful:

Step 1: Review

Assess where you stand today. Gather a complete inventory of your retirement resources, listing all potential income sources, assets and plans for the future, such as:

Social Security benefits
Pensions or other steady income sources
Investments and savings
Lifestyle goals and expenses

Taking stock of these items gives you a clear baseline. By reviewing your assets, income streams and goals, you'll see the big picture of your retirement.

This clarity is empowering. You know what you have to work with and what you need to plan for before you retire.

Step 2: Identify

Once you know your starting point, identify hidden risks or gaps that could derail your retirement plans. Ask yourself, "What could go wrong?" Plan for those possibilities.

Common retirement pitfalls include:

Outliving your money. With many of us living into our 90s, there's a real chance of outliving our assets if we don't plan for a long life.
Rising taxes or "tax traps." Future tax increases can eat into your nest egg.
Market volatility. A market downturn at the wrong time could shrink your portfolio when you need it most.
Health care costs and inflation. Expenses for health care tend to rise faster than general inflation, and both can erode your buying power over time.

By identifying these vulnerabilities, you can start thinking about solutions for each one.

For example, one often-overlooked gap is not knowing about Social Security survivor benefits. I've met widows who didn't realize they were entitled to a survivor benefit from Social Security and could claim that first while letting their own benefit grow until age 70.

Understanding such options can make a significant difference in your total retirement income. The key in this stage is to shine a light on all the what-ifs that might affect your financial security so you're not taken by surprise later.

Step 3: Strategize

After pinpointing areas that need attention, it's time to strategize solutions. Design a personalized retirement income plan to address the gaps and goals you've identified. This plan will involve decisions in a few important areas:

Optimize your Social Security timing. Decide when and how to claim Social Security to maximize your benefits.

An example is the previously mentioned situation in which a widow might claim a survivor benefit now and switch to her own, higher benefit at age 70, optimizing her lifetime income.

Create a reliable income stream. Figure out how to turn your savings into a steady paycheck for yourself. This could mean using some savings to buy an annuity for guaranteed income or structuring withdrawals from your 401(k) or IRA in a way that provides you with a consistent monthly amount.

Align investments with your needs. Make sure your investment mix matches your risk tolerance and income needs. You might shift some investments into more stable assets or dividend-producing stocks so a market drop won't jeopardize your essential income.

Optimize taxes over retirement. Plan the order and manner in which you withdraw from different accounts to reduce taxes.

For example, you might withdraw from tax-deferred accounts slowly over time (or convert a portion to a Roth IRA) to avoid being pushed into a higher tax bracket later.

These strategic moves combine to form your overall retirement roadmap. It's like building a bridge from where you are now to where you want to be.

Each choice — when to claim Social Security, how to invest, how to draw down assets — is a plank on that bridge.

The result is a coordinated plan that gives you the confidence that your bases are covered. You'll know how to pay yourself a retirement salary, how you'll handle potential risks and how each piece of your financial puzzle fits together.

Step 4: Execute

The final step is to put your plan into action and keep it on track. Even the best strategy means little if it's not executed. This is where you implement the solutions you've decided on and establish an ongoing process to monitor your progress.

In practical terms, executing your plan involves actions such as rolling over accounts or reallocating investments, setting up income distributions, purchasing any insurance or annuity products you decided to use and ensuring your legal and estate documents are in order.

It has many moving parts, but once the plan is in motion, you commit to regular checkups on your retirement plan's health.

I recommend reviewing your plan at least once a year or whenever a major life or economic change occurs. Markets will fluctuate, tax laws will change, and personal circumstances will evolve, so be ready to make adjustments along the way.

Think of your retirement as a long road trip — you might need to take detours or change course due to weather, traffic or a new destination.

Similarly, by revisiting and tweaking your retirement roadmap as needed, you'll stay on track no matter what detours life throws your way.

The Execute phase is an ongoing process for the rest of your life, but it's what turns a paper plan into real-world results.

By actively managing and updating your plan, you can enjoy retirement with a sense of control and less anguish, knowing you've prepared for the uncertainties.

Ezra Byer contributed to this article.

The appearances in Kiplinger were obtained through a PR program. The columnist received assistance from a public relations firm in preparing this piece for submission to Kiplinger.com. Kiplinger was not compensated in any way.

Disclaimer

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

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Robert Szigeti is the founder and president of SG Wealth Management in Princeton, New Jersey. He has served in the financial services industry since 1990, previously working on Wall Street and as an adviser at Smith Barney, where he was recognized as one of the top 10% advisers. Bob earned a degree in accounting from Rowan University and holds a Certified Investment Management Analyst® certification from The Wharton School.