How will your savings become income you can live on?
Accumulating money and drawing from it are different tasks. Start with expenses, reliable income, and the choices you want to preserve.
Your retirement reading guide
Build an income map.
List essential expenses, flexible spending, taxes, health costs, and occasional large bills. Then list Social Security, pensions, part-time work, and other expected income. The gap is what savings and other resources must help cover.
For example, $4,000 in monthly spending and $2,500 of reliable monthly income leave a $1,500 gap before any items not yet included. That is a planning illustration, not a recommended withdrawal amount. Test how the picture changes if a spouse dies, costs rise, or work ends sooner than planned.
Think about when you need the money.
Near-term spending, an emergency reserve, and longer-term growth needs can require different investments. Holding everything in cash carries inflation risk; relying entirely on volatile investments can make near-term withdrawals difficult. Diversification helps manage risk but does not guarantee a profit or prevent losses.
Losses early in retirement, combined with withdrawals, can deplete a portfolio faster than the same average return arriving in a different order. This is sequence-of-returns risk. Flexible spending, reserves, and a diversified allocation are topics to review—not a guarantee that a fixed percentage is always safe.
SEC: allocation, diversification and inflation risk ↗
Coordinate the tax treatment of your accounts.
Pre-tax retirement withdrawals generally add taxable income. Qualified Roth withdrawals are generally tax-free. A taxable investment account has different rules for dividends, interest, gains, and cost basis. Having more than one tax treatment can provide choices, but there is no universal order in which everyone should spend accounts.
A Roth conversion may create taxable income now to change future tax treatment. Model it alongside income taxes, Medicare IRMAA, other benefits, and available cash to pay the tax. A conversion is not automatically beneficial just because a future withdrawal could be tax-free.
Traditional and Roth basics → · Medicare premiums & IRMAA →
Required withdrawals are not a spending recommendation.
Required minimum distributions (RMDs) generally begin at 73 for people born in 1951–1959 and 75 for those born in 1960 or later; older birth years have earlier rules. Some workplace plans permit a still-working delay, subject to exceptions. Original Roth IRA owners and designated Roth workplace accounts generally have no lifetime RMDs. Inherited accounts follow separate rules.
An RMD is a tax-law minimum, not proof that the amount is sustainable or enough for your needs. Delaying the first RMD to the following April can put two distributions in one tax year. Check deadlines and withholding with your tax professional.
IRS: RMD rules ↗ · IRS: RMD regulations and applicable ages ↗
Explore our dedicated annuity guide →
Where might insurance fit?
Life insurance addresses a death-benefit need. Long-term care coverage addresses eligible care costs. Some annuities offer contractual income, with trade-offs involving liquidity, fees, inflation, surrender terms, and survivor options. Guarantees depend on the issuing insurer and contract. An annuity in an IRA does not add another layer of tax deferral to the IRA.
Compare any insurance proposal with your existing resources and goals. Replacing an investment account with an insurance product is not a default retirement strategy.
SEC: annuity features and trade-offs ↗
How the OBBB senior deduction and other tax changes may fit your plan →
Review the plan when life changes.
Revisit beneficiaries, pension survivor elections, Social Security timing, spending, and care arrangements after retirement, marriage, divorce, bereavement, a move, or a health change. A business owner should also revisit the expected sale proceeds and timing.
Social Security and survivor decisions → · Plan for care costs → · When you inherit retirement money →
General education, not individualized tax, legal, investment, or rollover advice. Reviewed October 16, 2026. Annual limits are dated and do not update automatically. Confirm your situation with the plan administrator, a qualified tax professional, and an appropriately licensed investment professional. LI4W’s insurance services do not include managing a securities portfolio.