The Importance of Post-Retirement Financial Planning

Retirement Daily Guest Contributor

By Sandra D. Adams

Most materials you will find related to retirement planning are focused on preparing for retirement with an emphasis on setting retirement goals, preparing for and getting to retirement successfully. But what happens when the retirement goal is met? Is the planning done?

Sandy Adams
Sandra Adams

In my work with clients there is often a feeling that once they’ve crossed the retirement “finish line” it should be smooth sailing from a planning standpoint. We’ve helped get them through the gauntlet of planning for retirement, now we can sit back and relax. Unfortunately, nothing could be further from the truth. In fact for many clients, post retirement is likely when they might need the assistance of a planner the most!

So, what are the planning issues post-retirement that might require the ongoing assistance of a financial adviser?

Retirement Income Planning

This focuses on putting together a year-by-year plan of the most tax efficient and  beneficial strategy from a longevity perspective, for taking income, given your resources. These include available pensions, deferred compensation, Social Security, and other available investments such IRAs, Roth IRAs, after-tax assets, and annuities. This can include working around RMDs (required minimum distributions) and trying to avoid the Medicare surtax. For some, this can be very simple and straightforward; for others, this can be extremely complex, especially if there are changes in income tax policies and tax brackets throughout the years.


Once you are retired, a couple of things happen to make it even more important to keep an active eye on your investments:

(1) You are more likely to have a need to start withdrawing from investments, and will likely need to manage the ongoing liquidity of at least a portion of your investment accounts to ensure that you have the availability to withdraw from the accounts when you need to.

(2) You have an ongoing shorter time horizon and less tolerance for risk, so more active management of assets for risk and asset allocation, is increasingly important to maintain balance.

Social Security

It is likely that in pre-retirement planning you may have talked in generalities about what you might do with your Social Security and which strategy you might implement when you reached Social Security benefit age. You may have run various projections to look at scenarios to consider which strategy would give you the best probability of success.

However, once you actually reach retirement, the rubber hits the road. Your reality sets in – you know what your true retirement income needs to look like, you know what your health outlook is (and that of your spouse – if that applies), and you can make a more informed decision about your actual retirement needs in the here and now.

Health Insurance and Medicare

For clients retiring before age 65 from employers that might not offer retiree healthcare, there is a huge challenge and often significant expense surrounding retirement healthcare pre-Medicare. And planning for the transition from employer healthcare to Medicare is no small task – there are lots of complications involved in “getting it right” and making sure that all of the choices made make sure that you are fully covered from an insurance standpoint once you get to retirement.

Life Insurance and Long-Term Care Insurance

Certainly life and long-term care insurances are items we hope to have in place pre-retirement, especially since the cost and the ability to become insured becomes more difficult the older one gets. However, maintaining these policies, understanding them, and having assistance once it comes time to draw on the benefits is quite another story.

Working with a planner who has the ability to do ongoing life insurance reviews, especially on cash value life insurance policies to make sure the policies are in good standing and don’t need ongoing adjustments, is very valuable. With long-term care policies, when the insurance companies try to raise premiums or when clients need to draw on benefits, having the assistance of a planner to help facilitate that process can be invaluable with preparing paperwork and making the process much simpler and more streamlined for the client and family.

Estate and Multi-Generational Planning

It makes sense for you to manage your estate planning even after retirement and to the end of your life. It’s the best way to make sure that your pass your wealth on to the next generation in the way that you want to, in the most efficient way possible. Managing account titling, beneficiaries, and making sure estate documents are reviewed and updated, as needed, as well as, encouraging families to document assets and have family conversations about their values and intentions for how they wish their wealth to be passed on and used is something planners can help with. In fact, many planners can help to structure and facilitate these kinds of conversations for you and your family.

Planning for Aging

For many people just entering retirement, one of their greatest challenge is how to help their now elderly parents with managing the aging process. How to navigate the health care system? How to get the best care? How to determine the best place to live as they age? How best to pay for their care, especially if parents haven’t saved well enough for their own retirement? How to avoid digging in to your own retirement pockets to pay for your parents’ care? How to find the best resources in the community? And what questions to even ask since this is likely foreign territory for most.

In addition, with people living longer and longer lives, it is likely that there will be a need for many to plan for their own aging lives. The more that you plan in advance, from a financial, estate, health care, and living preference perspective, the better the chance that there will not be a need to make uninformed decisions in an emergency situation. Planners can help clients put together alternatives for aging so that they and their families have contingency plans in place for future changes in health.

So, while it seems like the majority of the materials, time and energy of the financial planning world and of most clients in general, focuses on planning to get to retirement, there is so much still to do after retirement. Perhaps as much OR MORE than there is pre-retirement. Whether it is retirement income planning, investments, Social Security, health insurance or Medicare, life insurance or long-term care, estate and multi-generational planning, or planning for aging, having the help of a planner in post-retirement is likely something you might not realize you needed, but something you’ll certainly be glad you had.

About the author: Sandra D. Adams

Sandra D. Adams, CFP®, can be reached at 248-948-7900, Center for Financial Planning, Inc. 24800 Denso Drive, Ste. 300 Southfield, MI 48033. Securities Offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Center for Financial Planning, Inc. Center for Financial Planning, Inc., is not a registered broker/dealer and is independent of Raymond James Financial Services.

Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design) and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete the CFP Board’s initial and ongoing certification requirements.

Any opinions are those of Sandra D. Adams, and not necessarily those of Raymond James.

Every Investor’s situation is unique and you should consider your investment goals, risk tolerance and time horizon before making any investment, Prior to making an investment decision, please consult with your financial advisor about your individual situation.

Comments (2)
No. 1-1

There is no substitute for having a comprehensive, year by year financial plan. Even if you use an adviser it's a great double check (monte carlo simulations aren't all they're cracked up to be). Calculators and apps won't help with this so look for a robust planning tool (The Complete Retirement Planner is one example). Make sure to account for taxes, especially on RMD's!

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