Married Couples Social Security Strategy: When You Start Could Have a BIG Impact

Maximizing Your Social Security Family Benefit 

The date that you start Social Security can really impact the success of your and your spouse’s retirement plan. Not every married couple understands the extent this could affect their overall financial plan. Oftentimes, mistiming their Social Security ends in costly mistakes.

Most couples obviously aren’t doing this on purpose. It’s just that the information on what to do isn’t always clear. They unknowingly make decisions that have big implications for themselves and for their spouse in the future. 

In the video above, Dave Zoller shares what you need to know to avoid these costly mistakes and how to maximize your family benefit. 

Jane and Paul’s Story of Delaying Social Security Benefits 

Married couples thinking through their optimal income strategy for their retirement plan typically have a Social Security strategy in mind.

Social Security planning is one of those age-specific strategies that our team at Streamline Planning helps clients think through and plan for.  But it’s not a one-and-done solution.

A lot of people think that once they determine a Social Security plan, it’s set for the rest of their life. But there are a lot of changing factors to consider, 

  • How long are you really going to work? 
  • Is anything going to change over the next few years? 
  • What type of accounts do you have and what is available for withdrawal?

For example, this couple (we’ll call them Paul and Jane) are nine years apart. Paul is 67 and Jane is 58. The husband was planning to stop working this year and starting Social Security as supplemental income. Yes, the traditional planning technique would make sense here. Paul is 67 -at full retirement age. But when we ran the scenario, as you can see in the video above, his income plan looked good, but it brought up an important discussion. 

In this post, I’ll point it out some of the potential issues I noticed, so you don’t start planning your retirement in a way that could cause an issue in the future. Then I’ll walk through the actual numbers of this sample retirement plan, something that’s not in the article, just so you can get an idea of what this would actually look like and how you might get into trouble if you use this rule-of-thumb planning technique.

Again, this is my opinion, and it’s not advice. So please consult with your own wealth management team before making any decisions.

As we often do with our clients, we had to look farther into the future. We mapped out a scenario where Paul passes away at 84, and Jane is still 75. She’s got a good family track record of living a long time, and Paul, not so much. That doesn’t mean it’s definitely gonna happen, but just looking at the odds, it seems that’s a scenario we should plan for.

When we mapped out this scenario, the Social Security benefit would actually decrease by $1,800 (and that’s using just today’s values). That decrease happens because Paul’s receiving about $3,000 a month.

If he were to start Social Security now or this year, Jane is receiving or scheduled to receive $1,800 per month. If Paul passes away, Jane will be able to step up her benefit to what Paul’s was ($3,000). But that $1,800 that Jane was taking goes away.  Essentially reducing her total family benefit, from $4,800 down to $3,000, a 37% decrease. 

Does Delaying Social Security Maximize your Benefits?

So the question becomes- should Paul delay his benefit and instead use his other accounts? An IRA or taxable account could be used to supplement his income. That way he can continue to get an increase in Social Security. 

In this example, Paul passes away at 84, and Jane is 75. What if he’s able to delay Social Security till age 70? In the chart below, you can see the increased green bars that pop up, and this is for the benefit of Jane. So if they’re planning together as a couple, this could make a lot of sense for them.

For Paul and Jane, if he waits to claim his benefit and draw from investment accounts first, then his benefit could increase to $3,900 per month. And again, things could change for this plan and for this couple, because life changes. But this prepares them to maximize future benefits for Jane, if Paul were to pass away. 

Common Scenarios to Delay Social Security Benefits 

There are a lot of factors that go into these kinds of decisions. Having the ability to map out these scenarios and arrive at the best possible decision is a real benefit to retirees. 

First, remember that delaying to 67 (or really to any age) means you’re not receiving quite a bit of money from Social Security. For Paul, specifically in this example, he’s not receiving over 100K for those three or so years where he’s delaying it. That is a lot of money, but it could be worth it if your spouse is going to live longer than you are. 

A few other scenarios when it could make sense: 

  • Couples who have available funds in accounts other than Social Security funds
  • Couples who have a significant gap in age
  • Couples where at least one of them has a history of living a long time

If you’re thinking about planning for Social Security in this way, we recommend meeting with your own financial professional before making a decision. If you’re getting to the point where you’re going to start using Social Security benefits and need help figuring out the tax impact, the withdrawal, income, and the investment strategy in retirement, feel free to reach out to us. 

How to Take Retirement Withdrawals During Bad Markets

How to Take Portfolio Withdrawals in a Down Market

When markets go down, it’s also hard to watch the value in our accounts go down. It can even cause some to second guess if they’re doing the right thing. But if we spend just a few minutes preparing our portfolio for scenarios like this, we’ll have a much smoother ride and more confidence with our retirement plan.

But if we keep managing our portfolios the same way we did the last 30 or 40 years, and we don’t start designing the income withdrawal strategy, that could open us up to a lot more retirement risks that could and should be avoided. 

So in this video, I’ll go over a simple way to prepare to take withdrawals in a market downturn. My name’s Dave Zoller, and I’m a co-owner of Streamline Financial with Tim, Luke, and Sean, and we get to help a lot of people design their ideal retirement. If you’ve been working with an advisor for some time and you’re starting to realize that retirement has a whole new set of planning strategies but maybe it’s not their specialty, you’re welcome to reach out to us or schedule a free call with me. 

Segment your Investments into a Conservative and Growth Bucket

To keep it simple, think about using the “bucket approach” by segmenting your different investments into a conservative and growth bucket. Take the pre-tax accounts like your IRA’s and 401k’s, then separate all the individual holdings into two categories – conservative and growth. If you’re not sure if they’re conservative or growth, here’s a free tool to help you do this pretty quickly. 

Historically, assets that could fit into the conservative bucket have been cash or money markets or certain types of fixed income. The main purpose is for times when the stock market is down, it’s great to have investments in asset classes that are not down as much (like stocks). It’s much easier to use those conservative assets that aren’t down as much for income.

What we don’t want to do is be forced to sell an investment or fund that’s down the most. Instead, let those investments in the growth bucket stay invested and give it a chance to grow to where it once was. 

Determine Your Income Plan

You’ll also want to consider how many years of income you need (or want) in that conservative bucket…

  • Do you like having a year’s worth of cash available for expenses coming up?
  • Or maybe three to four years’ worth of income?

Another way we help clients figure out what the right amount to have in the conservative bucket is by first figuring out their income plan. This is really their entire financial life and retirement plan in one visual so that we know what rate of return we need for the plan to be successful. 

It allows us to model out many different scenarios, like higher than expected inflation, changes in expenses, or Roth conversion strategies. It shows us the result before we actually make the decision or before it happens. This really guides us to what we need in conservative assets, in that conservative bucket. 

One mistake that we see people make quite often is putting in more than what’s needed into the conservative bucket – they end up losing more to inflation than they really should be.

How to Identify Your Conservative and Growth Investments 

Using Portfolio Visualizer, and following along in the video above, you can start plugging in your asset percentages you can model different scenarios for your portfolio. This isn’t recommended allocations, it’s just to get an idea of what are the conservative assets vs. growth assets at a high level.

There’s a lot that goes into designing these allocations that are the right fit for your retirement plan, but this can give you an idea and help in deciding how to take withdrawals during market corrections or down markets. 
If you like retirement-specific videos like this, subscribe so that I see you in the next one.

Five Things To Have In Retirement That Can Make Life Better

Retirement is really a great period of life. And because we specialize in retirement planning here at Streamline, we know a lot of retired people. For some, they use this period of life as a way to simplify and declutter. It’s a natural progression when you get to that point. We’ve seen time and time again, people who are newly retired start to simplify life, which is really good.

But in this post, I’m going to share five things clients say are the most important things to own to make retirement even better. Some of these things are an added expense, and I know in retirement we have a tendency to want to save more and be frugal with expenses. But I believe these could be worth it and could actually give you more in return than what it costs to have them.

Health Club Membership

Having a membership to a health club might be expensive, but this can be one of the most important things that you own, if you use it. Prior to retirement, it might have been harder to get to the gym because of work and a busy schedule. But now, using some of that newly granted free time for fitness can pay big dividends. I know a few clients who’ve said that they feel better now in their mid-sixties than they did in their early fifties, directly because they made exercise a habit in retirement. And doing this one thing can really improve all other areas of retirement and of life; we’ve seen the studies behind that.

Adventure Book

If you’re looking for adventure or excitement in retirement, this is not essential, but it’s fun. It’s something my family has been using recently; so it’s not just for retirees, but I think you’d really get a kick out of it. It’s called The Adventure Challenge Book. We’ve been enjoying the family edition, but they also have one for couples and one for singles, as well as a few other versions. Each page has a new mini adventure that you scratch off. You don’t know what it is until you scratch it off and then you complete it right at that moment. As a family, we’ve been enjoying it a lot, so, I wanted to share it with you. And again, not essential for retirement, but it just could be a fun thing to, to spice up a weekend if you’re wondering what to do.

Your Own Car

The number of cars they own is something that many couples decide to cut in half in retirement. They think when they retire, they won’t be commuting to their jobs anymore and won’t use their cars as much. They try to simplify and go down to one. But I would think before you do that because having a car really offers freedom and flexibility. You can get up and go when you want to and you don’t have to plan around your partner’s schedule. It can work, to have just one car, but at least for the first few years, think about keeping two and maintaining your freedom and flexibility.

Emergency Fund

This is something that most people have before retirement, but once they get to retirement, they get rid of it. I can see the rationale behind not having an emergency fund in retirement because you’re starting to take withdrawals and maybe you’ve set up your bucket strategy. But, it still it makes sense to have an emergency fund separate from your retirement income strategy.

The emergency fund is really just for the unexpected, the unplanned things. Whereas your retirement income plan is planned out for the regular expenses that are going to be occurring, if an emergency does happen, it’s less likely to impact your plan if you’ve got that set-aside money in the emergency fund. So having three to six months of expenses set aside is still a good idea in retirement.

Enroll in College

This last point is also related to fitness, but it’s not physical fitness, it’s more mental fitness. Many local colleges, or you can find an online college, offer classes specifically for seniors at a very affordable rate. Curiosity really is the fountain of youth and, and staying challenged after your career is important for a healthy brain. So, finding the courses or topics that interest you could be a good idea. You might even meet people who are interested in the same in things as you and start to increase social ties to other people.

Seven Things Happy Retirees Do Well

When I talk to clients after a year of retirement, I get one of two answers. Some say it’s going great and they’re really enjoying an amazing stage of life. Others say it kind of stinks. They thought they’d be having a lot more fun with their free time. That they’d be enjoying it but really, they’re bored and it doesn’t feel right.

I’m not sharing this to scare you, but because I really want you to think about your retirement. If you’re going to make it the best stage of your life, you’re going to have to think about it. Now, we both know that retirement isn’t just figuring out the money side of things. That’s important, but it’s actually easier to figure out the money side than the non-financial things. At Streamline, we have been doing this for 22 years and have it, we believe, down to a science. We know that once we start monitoring and running the income system and the investment system, it brings a lot of peace of mind for clients.

But why are some clients–who don’t have to worry about the money side of things anymore–happy, and some are unhappy?

In this post, I’m going to share seven things that I’m seeing in people who are successful and happy retirees. These are things that they are doing to enjoy retirement and live their life to the fullest.

Make a Non-financial Retirement Plan

The happiest retirees take dedicated time before their retirement date to think through how they want to spend their time. Maybe you’re thinking, I’ll just do whatever I want. I’ve got freedom now and that’s all that really matters to me. But be careful.

There are five stages of retirement and the third one is actually kind of a let-down stage. It’s when many people fall into a slight depression. The honeymoon phase of retirement is over and they’re starting to feel like they don’t have direction or purpose in life. This happens because work used to be their main source of purpose and meaning for the day or for their week. Also, work was the main source of social activity and now connections are less a part of their lives.

Here’s the good news: some people get to retirement and because they spent a little time on the financial-planning side of things, they continue to increase their contentment level and their happiness levels. That’s what I want for you! So here are a few questions to think about:

  • What can you do in retirement that you can’t do now?
  • What are the top three most important things in your life right now?

This second question will help you get clear on your values. Once your values are clear, money decisions actually become easier. We have seen this first hand. I wrote a short guidebook on how to find your purpose in retirement. Click here to access it.

Set Up Power of Attorney and a Trust or Will

This sounds boring, but if you can do it, you will have less burden on your mind. You can sleep better at night because you removed the worry of the unexpected. Removing burden from our clients’ shoulders is one of the core motivators behind what we do at Streamline. Having your Power of Attorney set for medical and property, and the rights wills and trusts set up for your financial situation, allows you to know that if something unexpected happens, your financial life will still continue to run appropriately.

You might be thinking that when you die you don’t really care what happens next. But what if you’re still alive but unable to act on your own behalf? Within the last year I have seen three clients decline mentally to the point where they are not able to manage their own affairs. Having the trusts and POAs set up make it easier on their family. So, consider talking to an attorney and seeing what makes the most sense for you.

Make Health a Priority

Did you know that the Freshman 15 isn’t just about students who gain 15 pounds in their first year of college? When you retire, you might have less structured meal times. You might be less physically active than when you were up and moving around for work. And you might have more time for social things, which is good, except that social events are usually centered around eating and drinking.

The journals of gerontology (the study of aging) also show that many retirees consume food in response to losing personal identity. This is a very common thing that can happen. Have a plan to stay active, pick up a new athletic activity, or just be aware of what you’re eating. It sounds simple but retirement is a major life change. It’s actually the best time to create some new habits. So, why not create habits around staying healthy so that you have more of a chance of being free from disease and ailments in the future.

One thing my dad did when he retired was get a fitness tracker that he wears on his wrist. It’s kind of gamifying the exercise experience for him and he’s been enjoying it a lot.

Be Generous with Your Time, Money, and Skills

In retirement, you now have the most time you’ve ever had. You have the most money you’ve ever had. And you have the most wisdom you ever had. Now this may not be true for everyone, but it is for most people in retirement. And if it is true for you, then you’re a pretty valuable person and you can be generous with your time, money, and skills. One of the best ways I’ve seen retirees find fulfillment and purpose in life after work is to discover or rediscover their unique strengths, and then use those strengths to help other people.

The reason this is so important is because if you can practice generosity, you have the power to change someone’s life. You’ve seen the studies, I’m sure, about when you give, you’re actually happier and I believe it’s true. It’s an easy equation of give = happy to test out and see if it’s true for you too.

Another reason is that when you watch and read the news, it’s not hard to think that the world is kind of a messed up place. I’m an optimist and I try to focus on being grateful for the things in my life, but sometimes when I look at the world, it does look messy. The cool thing is that when you start giving your time, money, and skills to help others, something happens. Pockets of good appear in the world. I believe that being generous with what you have can actually make the world a better place. And even if the whole world doesn’t change, you might change the world for just one person by your generosity.

If you don’t know your skills, Strengths Finder is a great, short assessment that can help you find out your unique strengths, or rediscover them after retirement.

Outsource Things You Don’t Want To Do

Wouldn’t it be nice if you could spend the majority of your time on things that you actually want to do? I was working with a new client recently and he added a new expense in retirement. His whole adult life he did the landscaping, he cleaned the windows, he did the gutters in the fall, and all these other household things. It wasn’t until retirement that he decided he didn’t want to do those things anymore. We looked at his retirement plan and added in a few extra expenses to outsource house cleaning and maintenance. This did have an impact on his plan, and there was a projected amount that was lost over the next 30 years or so, but it did not hurt his plan at all. Seeing that projection gave him the peace of mind to cross yard work off his list of chores.

This same guy didn’t love keeping up with retirement planning strategies and tax law changes and what’s happening in the economy and abroad. He didn’t want to spend time thinking about it. It made him more stressed when he did and it wasn’t enjoyable. So, he outsourced it to us. This client remained the CEO of this own life, but outsourced the CFO position to our wealth management firm. He sees the cost of hiring us as an investment because he’s getting a return on that money since we’re using strategies that he wouldn’t have to add alpha and tax savings to his plan. Plus, he has his time back, which is even more valuable.

Stay Social

We all know the science behind relationships being the key to health and happiness, so I won’t spend a lot of time going into it. But here’s another question to stop and consider:

  • Who do I desire to build a stronger connection with? Why?

Continue to Grow

Happy retirees who retire well continue to grow in retirement. A friend of mine was struggling recently. He was trying to find what he should be doing in life–what was his purpose?  He knew that he wanted to feel different, but he just couldn’t get out of this funk that he was in. Here’s how he did it: at the end of each day, he answered the following questions:

  • What did I make progress on today that made today better than yesterday?
  • What can I make progress on tomorrow that will make tomorrow better than today?

He said doing this has made a big impact on his life. My challenge for you is to take two minutes before bed tonight and answer these questions, looking back on the day that just happened and forward to tomorrow. Try this for five nights in a row. I did this last week and I’m not joking when I say it was one of the best weeks I’ve had all year. Maybe it was a coincidence and things just happened last week that really stood out. Maybe not, but it would be fun it you tried it and see what happens.

How Much Is Enough?

In this post, I’m going to give you some ways to find out how much is enough for you. This is so important because it’s much harder to reach financial independence if we don’t know what our enough is.

Enough is where we could find more peace in our life. It’s where we’re going to have enough to be content or happy, but not so much where we stop being grateful for the things that we do have. And if you can find your enough, then that’s going to lead to true wealth.

At a party given by a billionaire on shelter island, Kurt Vonnegut informs his pal Joseph Heller that the host, a hedge fund manager, had made more money in a single day than Heller had earned on his first wildly popular novel, Catch-22, over its whole history. Heller responds, ‘yes, but I’ve got something that he’ll never have: enough.’

John C. Bogle*

So, enough is going to be different for everyone. And it’s best illustrated by a chart from Your Money or Your Life by Vicki Robin that shows the relationship between the money that we spend and the fulfillment we receive from it. While we all follow the same curve, the dollar amounts are different for each person.

  • Survive
    • This is where you get a lot of fulfillment from every dollar that you spend because you’re spending it on things that are necessities: food, water, and shelter.
  • Comfort
    • The next level is where you start to spend more and your fulfillment level grows equally. These are the things that make life enjoyable.
  • Luxury
    • This is where it gets interesting. At the luxury level is where we have our fun, but this is also where the curve starts to flatten out. This is your enough. Up to this point, every dollar you spent increased your level of satisfaction and fulfillment. But after this point your satisfaction level starts to level off or decrease.

You might be thinking this decrease wouldn’t happen to me, but I’ll show you how it happens. As you start to spend money on things that you don’t need or use, this starts to decrease fulfillment because everything you buy will start to take up more mental space or more physical space, but the return on satisfaction is low. What ends up happening is more complexity and more responsibility, and really added on stress. This could also lead to poor stewardship for what we’re managing.

Have You Reached Your Enough?

There are a lot of people who have actually achieved this level of enough, but they just don’t know it yet. I was listening to an author recently and he was writing a book on the relationship between money and happiness. He interviewed dozens of people who we would consider wealthy.

First, he asked a friend who had over a million dollars in investments in the bank, do you feel rich? And the friend said, no, because I don’t have $10 million.

Next, the author interviewed a woman who had $10 million and asked, do you feel rich? She said, no, because I don’t have a private jet yet.

And then he asked a man who had a private jet and he asked, do you feel rich? He said, no, because this jet is only a six-seater and I could get a 12-seater or 20-seater.

That example might sound silly, but it really relates, because if we don’t define where our goalposts are or what we’re aiming for, it’s always going to be out of reach. I’m sure you can relate. And it might just be the way that we’re designed, our human nature, to always want to achieve the next level. But if we could find our enough, we’ll start to live a truly wealthy life.

How Do You Find Your Enough

First, we need to start with something that’s boring, but it’s evaluating where our current expenses are. MINT.com could be a good resource to help you do this automatically and easily. This is crucial to finding your enough.

Then, we want to make sure that we know what our values are; to define the things that are most important to us. When our values become clear, then money decisions become easier. We can quickly realize if our expenses line up with our values. For example, if health was important to me, then a purchase of a $2,000 exercise bike might be in line with my values, whereas a $1,000 new TV might not be. But my neighbor, who has different values than me, might think that $2,000 for an exercise bike is ridiculous because it doesn’t line up with the things that he values most.

It’s important to remember that everybody’s different and everyone has different values. Knowing yours and how they match up with your expenses is important. If you need help refining your values, click here to access a free one-page worksheet that will help.

Once we’ve defined our values and aligned our expenses, look at the fulfillment curve to discover our peak fulfillment point. Look for the place where you have what you need and you can buy a few luxuries that align with your values, but not so much where you start to over-complicate your life. Many people think that this is a lump sum number. But it might be easier to think of it as an income number. This means: how much would be enough to be coming into the bank each month without you having to actively work for it, and then work backwards to see how much in assets you need to provide that income.

An important final note

Remember that you’re enough right now. Your income and your assets don’t make you enough. Yes, we have to figure out the money stuff because the world uses it. But I’m sure you’ve heard, like in the jet example, there’s very rich people who never feel like they are enough or that they have enough because they’re looking for more money to prove it. And the sad thing is, I don’t know if they’ll ever get there. So none of it is easy, but I hope this helped you think about this idea of enough in a different way.

*The John C. Bogle quote is from his book Enough: True Measures of Money, Business, and Life.

Update: Three-Bucket Retirement Strategy

I met with a man recently in his early sixties who’s looking to retire within the next six months. As we started talking about the Three-Bucket Strategy and how it fits into his retirement income plan, the question came up: how much should I have in each one of the buckets? If you don’t know about Three-Bucket Strategy yet, stop reading now and watch this video. Then come back here for my conversation with this client and what we decided to do with his three buckets.

First Step: Creating an Income Plan

If you’ve seen my previous videos, then you may remember that there’s a certain order in creating your ideal retirement plan. Before we can create the investment plan and decide how much of each asset class going to go into each one of the buckets, we must first create the income plan.

The income plan is a visual representation that allows us to see what impact any financial decision has on the life of the total retirement plan. It’s a very useful step in creating more confidence in your financial life. For example, if you wanted to spend a little bit more money traveling early on in the first few years of retirement, we would be able to see that the total retirement plan amount does go down a little bit, but it’s not harming the plan as a whole. Or maybe you’re going to have part-time income in retirement; seeing how that affects your total amount is going to help us decide what to do moving forward. We can really look at all different sorts of scenarios. Sometimes we talk about the four economic seasons and what sort of impact they might have on the ideal plan.

Once we have the income plan, we start looking at what investment plan is best suited to achieve the goals of the income plan.

Start with Ideal Income Amount

My new friend, who I mentioned at the beginning of this post, had done some preliminary work in trying to figure out how much should go into each one of the buckets. First, he figured out what his ideal income would be coming into the bank when he was retired. That amount was $20,000 per month.

And now as a quick note, don’t let the numbers throw you off. We’re all in different positions and we’re all planning for our unique lives. We don’t need to compare to other people. Some people have more, and some people have less. This person that I was talking to is a giver. He’s also supporting charities, and he wants to travel a lot the first few years of retirement. So, I’ll use his numbers here, but don’t let it impact your mindset as you’re planning your retirement.

This client wanted enough in his Conservative Bucket for at least five years’ worth of withdrawals. He’s going to have about $5,000 coming in from his and his wife’s Social Security. So, he estimated withdrawing $15,000 from his investments in various accounts each month. Then he did the math of $15,000 times 12 months, then times 5 years to equate $900,000. ($15,000 x 12) x 5 = $900,000

Plan for Different Scenarios

Based on this math, he asked if this means he should have $900,000 cash in his Conservative Bucket. His logic seems reasonable and it makes sense, but the total investments he had across the board was $6 million. This means that if he followed that plan, he was thinking he’d have an allocation mix of about 15 percent conservative assets and 85 percent more aggressive assets.

We looked at his income plan, and then modeled out what a portfolio would do in these upcoming years. We considered both the good and the bad scenarios. Then, we had a conversation about his own feelings of risk around retirement. We also considered the least amount of risk that we need to take on order to have a successful retirement plan. Based on these factors, we ended up lowering the return assumptions and updated his income plan. We also added some asset classes that he did not previously have in his total allocation. Finally, we found that an allocation with a lower risk number than his first assumption was better suited for him. So, to keep it simple, he ended up closer to a mix of 65/35 conservative to aggressive. There are many asset classes within that mix, so he’s prepared for all the potential economic seasons that we may head into.

Process of Planning

If you’re like many of our clients who are close to, or already in, retirement, you might have the feeling that you’d like to take on no more risk than what you need in order for your plan to be successful. And as you can see from this post, creating your ideal retirement plan is really a process of discovery. Once you create the plan, it’s not over because a retirement plan isn’t necessarily that valuable. Life changes tomorrow; the economy changes, the markets change. It’s really the process of planning that’s the valuable thing.

An exercise to try today could be to pick out a monthly income number that you’d like to have coming into the bank in retirement. Then choose the numbers of years of safety you’d like to have in your Conservative Bucket. Go back to the formula I shared earlier of (Monthly Income x 12) x Years to see how much you need to have saved. Sometimes we look at the average Bear Market and make sure we can last from peak to trough and back to peak again––that’s one way people do it––and then work backwards to see what your total allocation would be. When you look at that allocation, think about if you’re comfortable with the risk, or does something have to change. This is a good way to start thinking about your own process of planning.