Plan Your Retirement Income: Secure Your Financial Future

Retirement Income Planning

You’ve spent years building a life you love, and now retirement is on the horizon. A time to embrace new adventures, cherish moments with loved ones, or simply enjoy the freedom to live on your terms. The key to making that vision a reality lies in your retirement income. The steady flow of funds from Social Security, pensions, savings, and investments that will carry you through this next chapter. Planning your retirement income thoughtfully now can help you discover whether your current strategy leaves you with a shortfall or extra room to dream bigger. With tools like our retirement income calculator at Legacy Haven Advisors, you can gain clarity and confidence to shape a plan that fits your life.

Why Retirement Income Planning Matters

Retirement income planning is about ensuring your money supports the lifestyle you want, whether that’s traveling the world, supporting family, or pursuing hobbies you’ve put off for years. It’s about aligning your income sources with your expenses. From essentials like housing and healthcare to discretionary joys like dining out or gifting to grandkids. Without a clear plan, you might find your income doesn’t stretch as far as you hoped (an income gap) or that you have more than you need (a surplus). Both scenarios have implications. Research from the Employee Benefit Research Institute (EBRI) shows that about 40% of retirees risk running short of funds due to rising costs, especially healthcare, which can exceed $315,000 for a couple over 65, according to Fidelity’s 2025 estimates. On the other hand, a surplus could open doors to new opportunities or legacy goals but might also lead to tax challenges if not managed well.

What Happens When You Assess Your Plan?

Taking a close look at your retirement income plan helps you answer a critical question: Does your current strategy support the life you want? By projecting your income against your expenses, you can spot potential gaps or surpluses and make informed choices.

• Income Gaps: If your income falls short of expenses, you might need to dip deeper into savings, which can shorten your portfolio’s lifespan. For example, withdrawing an extra $10,000 a year from a $500,000 portfolio could deplete it years earlier, especially if markets dip. This might mean scaling back plans or finding new income sources to bridge the gap.

• Income Surpluses: If your income exceeds expenses, you have exciting options. Investing for growth, funding a dream trip, or leaving a legacy for family or charities. However, surpluses can also lead to higher taxes, especially with required minimum distributions (RMDs) starting at age 73. Smart planning ensures your extra funds work for you.

Either way, knowing where you stand empowers you to adjust your plan now, whether that’s tweaking investments, rethinking spending, or exploring new income streams.

Steps to Build a Strong Retirement Income Plan

Creating a retirement income plan doesn’t have to be overwhelming. Here are practical steps to help you craft a strategy that keeps your dreams within reach:

1. Map Your Income and Expenses
   List all income sources—Social Security, pensions, annuities, investment withdrawals, and compare them to expected expenses, including essentials (housing, healthcare) and lifestyle choices (travel, hobbies). This snapshot reveals whether you’re on track or need to pivot.

2. Diversify Your Income Sources
   Relying on one source, like Social Security, can be risky, and usually is not enough to satisfy essential expenses. Adding annuities for guaranteed income or dividend-paying investments for flexibility can create a more resilient plan.

3. Balance Your Portfolio
   As retirement nears, shift toward a mix of stocks, bonds, and other assets to reduce market volatility’s impact. A “glide path” strategy can stabilize your income over time.

4. Create a Buffer
   Create an asset that is liquid, beats inflation, and has tax advantages to avoid selling investments during market dips. Ideally in market downturns you will draw from this asset to avoid selling other assets at unfavorable prices. Learn more about Buffer Assets here.

5. Plan for Flexibility
   Be ready to adjust spending in lean years or reinvest surpluses during strong markets to keep your plan sustainable.

6. Explore Tax Strategies
   If you have a surplus, consider tax-efficient moves like Roth conversions, funding cash value life insurance, or charitable giving to maximize your funds.

7. Use a Retirement Income Calculator
   Tools like our retirement income calculator can project your income and expenses, showing whether your plan risks a gap or offers a surplus. It’s a straightforward way to see if your strategy needs fine-tuning.

Why Act Now?

The sooner you assess your retirement income plan, the more options you have to shape your future, and the more time you have to implement those options. For instance, catching a potential $10,000 annual gap early might mean working a year longer, adjusting withdrawals, or reallocating capital to fill the gap. A surplus, meanwhile, could fund new goals or grow through smart investments, adding years of financial freedom.

Take the First Step

Your retirement is about living the life you’ve worked hard for whether that’s exploring new places, spending time with family, or leaving a lasting legacy. A solid income plan ensures your money supports those dreams, no matter what surprises come your way. Curious about where your plan stands? Try our retirement income calculator. In just a few minutes, you can see if your strategy is on track or if it’s time to pivot for a more secure future. Start today, and take control of the retirement you deserve.