Retirement Today Is About More Than Investments — It’s About Making Informed Decisions and Maintaining Control.
The markets will always move — that’s their nature. But control doesn’t come from trying to predict them; it comes from building a system that can hopefully thrive through them.
In Part 1 of our decumulation discussions, we explored what it means to enter the harvest season of your financial life — the transition from tending your garden to enjoying its fruits.
A plan to harvest wisely allows you to know now how your money will support your lifestyle, protect your income needs, and flexes when life or markets shift.
Now it’s time to look at how to harvest wisely. A successful decumulation plan doesn’t happen by chance; it’s the result of thoughtful structure, timing, and ongoing care. At Evergreen Wealth Advisors, this is where holistic planning truly comes to life — blending income strategies, tax planning, and risk management into one sustainable system.
The Spending Architecture: Buckets, Guarantees & Flexibility
Here are some of the tools and approaches we deploy:
- Guaranteed income for essentials: By aligning core living expenses (housing, health care, basic lifestyle) with guaranteed income sources, clients can gain the “license to spend” the rest of their portfolio more confidently.
- Bucket or horizon-based strategies: We segment the portfolio into shorter-term, mid-term, and longer-term buckets. Short-term cash/liquid assets handle the next 3-5 years of spending; mid-term involves moderate risk assets; long-term remains growth-oriented to guard against inflation and market shocks.
- Dynamic asset allocation & withdrawal rules: Because the decumulation phase introduces different risks than accumulation (e.g., larger drawdowns, market timing risk), the portfolio must adapt over time — not just be a static 60/40 split.
- Tax and withdrawal sequencing: Which accounts to draw from first (taxable, tax-deferred, tax-free) can have major implications for net income, taxes, and longevity of assets. We integrate tax-aware drawdown planning as part of the strategy.
Monitoring & Adjusting: Because Life (and Markets) Change
Holistic decumulation is not a “set it and forget it” process. At Evergreen, we incorporate ongoing review and adjustments:
- Annual check-in: Review current spending versus plan, evaluate portfolio performance and drawdown impact, revisit income projections (e.g., Social Security, Medicare/health costs).
- Market-and-life-event triggers: If markets drop by a certain percent, or if you incur a major health or long-term care expense, we may make recommendations to protect your assets.
- Behavioral coaching: One of the most under-appreciated risks is emotional: fear in downturns, reluctance to spend when appropriate, or over-spending early out of guilt. We proactively help clients stay aligned with their long-term plan.
- Legacy and optimal drawdown updates: We periodically revisit whether you remain on target for your legacy/giving goals given your current asset drawdown, inflation, and lifespan assumptions.
A Case Example (Hypothetical)
Let’s walk through a simplified scenario to illustrate how the holistic model works.
- Jane & Bob retire at age 65. They have:
- Guaranteed lifetime income (Social Security + pension) that covers ~60 % of their essential expenses.
- A diversified investment portfolio of $2.5 million.
- A desire to leave a modest legacy for children and charity.
Step 1: We calculate their essential spending (housing, health, utilities, modest lifestyle) and map how the guaranteed income covers that baseline.
Step 2: We define how much discretionary spending they want (travel, hobbies, home renovation) and test the drawdown impact on the portfolio (including inflation, sequence risk).
Step 3: We allocate the portfolio into:
- Short-term bucket (~3–5 yrs) in more liquid, lower-risk assets
- Mid-term bucket (~6–15 yrs) in balanced growth + income assets
- Long-term growth bucket (~15+ yrs) to protect against inflation and support legacy
Step 4: We establish a withdrawal strategy: For example: draw from taxable account first (for tax diversification), hold off on tax-deferred until later, maintain flexibility for large health or longevity events.
Step 5: We schedule annual reviews and communicate clearly: “Here’s your spending license this year. If markets fall or you incur a big expense, we may revisit.”
The result: Jane & Bob feel more confident spending today — because the basics are covered — yet they also have a dynamic cushion to adapt if circumstances change.
Why a Holistic Model Matters
- It bridges accumulation and decumulation — so your advisor isn’t just thinking “build the nest egg” but “spend the nest egg wisely.”
- It addresses risks beyond markets: longevity, inflation, taxes, healthcare, behavior.
- It helps create peace of mind by anchoring spending to income streams and a plan — reducing anxiety around running out of money.
- It remains flexible, adjusting to changing life phases, goals, and markets — rather than rigidly sticking to one withdrawal rule.
Final Thoughts
Decumulation doesn’t have to be scary — but it does require a shift in mindset, thoughtful strategy, and ongoing management. At Evergreen Wealth Advisors, our holistic approach to decumulation helps ensure that your retirement income plan is integrated, adaptive, and aligned with your life goals.
As you transition from accumulation to distribution, remember: having money is only half the battle — making it last while living well is the other half. A thoughtful decumulation plan helps you enjoy retirement today, protect your future, and leave a legacy if you choose.
If you’d like to explore how your decumulation plan looks under this holistic framework — mapping income, spending, portfolio drawdown and legacy goals — we’d be happy to help.
Let’s set a time to review your unique situation.