Mistake #3: Failing to Build Flexibility Into Your Retirement Plan
Q: Why is flexibility so important in retirement planning?
A: Because life in retirement doesn’t go exactly as planned. Markets fluctuate, goals shift, healthcare costs change—and your income strategy should be able to change with it.
What Happens If Your Plan Is Too Rigid?
- Locked-in income sources can’t adjust to inflation
- Rigid spending rules don’t account for unexpected expenses
- Emotional decision-making during downturns without a buffer
- May lead to overspending in good years and cutting back in bad ones
Where Should Flexibility Show Up in Your Retirement Plan?
1. Spending Flexibility - Build in a range for non-essentials—travel, hobbies, gifts—so you can cut back without stress when needed.
2. Withdrawal Strategy Flexibility - Use guardrails or dynamic withdrawal rules that adapt to market returns.
3. Investment Flexibility - Diversify across time horizons (buckets) and risk levels.
4. Tax Flexibility - Keep funds in different tax “buckets” (Roth, IRA, brokerage) to control taxable income year-to-year.
Real Example – Building a Plan That Adapts
A Portland couple nearing retirement wanted everything “locked in.” We showed them:
- How fixed annuities could cover essentials
- How a flexible portfolio could grow or shrink distributions
- How having both gave them confidence—no matter what changed
They were able to take a big trip in year 2 and reduce withdrawals in a down market—without worry.
Conclusion: Flexibility Isn’t a Weakness—It’s Your Retirement Superpower
A rigid plan breaks under pressure. A flexible one adjusts. And in retirement, that’s everything.
As a Portland-based retirement income advisor, I help you build a plan that works now—and keeps working as life changes. Take your complimentary RISA to see how flexible or stable your income style really is.
FAQs
Q: How do I make my retirement plan more flexible?
A: Use a mix of income sources, consider dynamic withdrawal strategies, and structure your accounts for tax flexibility.
Q: Can I still have a predictable income with a flexible plan?
A: Yes—many retirees blend a stable base income with a flexible layer for lifestyle spending.
Q: Is flexibility more important than safety in retirement?
A: You don’t have to choose. The right plan balances both, using tools like RISA to match your comfort level.