Building a Plan that is Designed to Outlast You
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We’re often asked, “how much do I need to save to retire?” The answer depends on the
income needed to support the life you’ve envisioned for as long as you need it.
Everyone’s retirement vision is different, and Azura approaches every plan with a focus
on income, not just savings.
With our open architecture approach and experienced advisors, Azura Wealth Advisers
specialize in helping to create sustainable, tax-efficient income streams that adapt to
your needs and priorities. Whether you’re mapping out your first plan or revisiting an
existing strategy, our focus is on helping you transition from building wealth to living
securely off of it.
Creating a retirement plan that is designed to outlast you takes many factors into
consideration. This article explains how to approach building a strategy that shifts the
focus from, “how much money do I need?” to, “how much income will support my life?”
With the right plan in place, you can have the financial peace of mind of knowing that
you are prepared for the years ahead.
I. Understand Your Expenses
The foundation of your retirement plan is knowing your future costs. Retirement
expenses aren’t static—they shift as your life changes. We start by outlining your
current spending, and then account for factors like healthcare costs, inflation and
lifestyle goals.
Example: Healthcare costs often rise with age, and long-term care or out-of-pocket
costs can quickly add up. Planning for a 3-5% annual increase in healthcare costs is
common for many retirees. 1
Key Insight: Retirees often underestimate discretionary spending in the early years of
retirement. As we often say, “every day is Saturday in retirement.” Be realistic about
how much you’ll need to maintain your desired lifestyle.
II. Know Your Retirement Income Sources
We identify all potential income streams, such as 401(k), Social Security, brokerage
accounts, rental income, annuities and any pensions. Then we calculate whether these
will cover your projected expenses.
Practical Tip: If you plan to rely on investment income, consider starting with the 4%
Rule—a rule of thumb for retirement spending. It is a guideline suggesting you can
withdraw 4% of your investment portfolio annually, adjusted for inflation, to maintain a sustainable income. 2 For example, if you have $1 million saved, withdrawing $40,000 annually could potentially last 30 years.
III. Plan for Longevity
With medical advancements, many retirees live 30 or even 40 years in retirement. In
fact, a 65-year-old couple today has an almost 50% chance of at least one partner living
to 90. This makes outliving your money a real concern. 3
Key Insight: Annuities can provide a steady income for a specified period of time or life
offering a sense of confidence when longevity is a concern. These products, when
carefully selected, can complement other income sources and help reduce the risk of
running out of money.
IV. Inflation-Proof Your Plan
Inflation erodes purchasing power over time, so your retirement income must grow to
keep pace. For example, $100,000 today will not stretch as far 24 years from now. If
history is a guide, every twenty years we see a 50% reduction in the purchasing power
of a dollar. 4
Practical Tip: Consider Including growth assets, such as stocks, in your portfolio even
during retirement. 5 While they come with risk, they may also have the potential to help
your money outpace inflation. A balanced approach can provide both growth and stability.
V. Revisit and Adjust Regularly
Life and markets change, so your retirement plan should be flexible. Regularly review
your plan to adjust for unexpected expenses, market performance, or new goals.
Example: If your portfolio allocation drifts due to market gains or losses, rebalancing can
help maintain the right mix of growth and stability that reflects your risk tolerance,
financial goals and time horizon.
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Conclusion: A Plan That Works for You
At Azura Wealth Advisers, we understand that every client’s retirement journey is
different. That’s why we combine expertise with a personalized approach, focusing on
the strategies that matter most to you. From helping you manage income sources to
inflation-proofing your plan, our team works alongside you to help ensure your
retirement plan is designed to outlast you—and to help you enjoy the life you’ve worked
so hard to build with confidence.
2 This rule is a general guideline created by Bill Bengen based on historical data and is not guaranteed. Actual results may vary depending on market conditions and individual circumstances.
3 Source: https://www.rbcwealthmanagement.com/en-us/insights/how-to-plan-your-health-care-and-life-expectancy
4 Source: https://www.investopedia.com/terms/r/ruleof72.asp
5 Investing in stocks involves risk, including the potential loss of principal. Diversification strategies do not ensure a profit or protection against loss.