Preparing for the Unexpected.

Your retirement planning happens in two distinct phases. First, there’s the accumulation phase, where you’re focused on long-term growth to build your nest egg. Then, there’s the distribution phase, where you start enjoying the harvest of the funds you’ve accumulated for your retirement. Transitioning between these two phases can be tricky.

The distribution phase introduces new and different dynamics to your financial life, and if you’re not careful, your funds can be depleted much faster than expected. Unfortunately, many advisors tend to focus mainly on accumulation. There are various reasons for this, including the pressure to push financial products their firm wants them to promote—typically the ones that make the advisor and the firm the most money.

These products may show flashy growth at times, and they generate nice fees for managing an ever-growing portfolio. But an advisor who operates more like a salesperson doesn’t want you to withdraw money from the funds they manage, because when the balance gets smaller, so do their earnings. This approach is far from how a true fiduciary operates, mainly because it doesn’t put the client’s best interests first.

As you transition into the distribution phase, there are many factors to consider: tax increases, inflation, rising health care costs, and surviving spouse issues, to name a few. That’s why retirees—and especially surviving spouses—need trustworthy resources and partners, from health care professionals to real estate experts, and most importantly, a true fiduciary financial planner.

One of the best places to start when planning for your nest egg distribution is with a solid plan for managing your Social Security payments, which is often overlooked. Because many financial advisors are so focused on accumulation, they might not even be aware of key intricacies within the Social Security program that could make a significant difference in your retirement planning.