1. Module III Bootcamp
Comprehensive Retirement
Planning

2. Retirement Planning 101
Accumulation
…the challenge involved in
efficiently turning income into
wealth
Decumulation
…the challenge involved in efficiently
turning wealth into income
• Emotional
• Variety of income sources with
various rules and tax implications
• Possibility of new income sources

3. Retirement Planning 101
Starting with the Social Security filing decision, an advisor can learn their clients’ other needs:
• Estate attorney
• Medicare
• Long term care planning
• Life insurance
• Annuities
• Real estate / Mortgages

4. Retirement Planning 101
Must distinguish
dependable income and
variable income.
Different strategies for
each to minimize taxation
of this income.

5. Fixed vs Variable Spending
Fixed Essential Expenses
• Mortgage
• Property Taxes
• Home Insurance
• Medicare Part B Premiums
• Income Taxes
• Other Fixed Expenses
Variable Discretionary Expenses
• Household/Utilities
• Food, groceries, dining out
• Transportation
• Health Care
• Personal Care
• Travel/Entertainment

6. Tax-Efficient Retirement Strategies
1. Plan Timing of Social Security
Higher portion of Combined Income = lower taxation
2. Shift taxable investments from
income to growth-type
Lower AGI = lower Social Security taxation
3. Shift funds to tax-deferred or
preferred accounts/products
Lower AGI = lower Social Security taxation

7. Tax-Efficient Retirement Strategies
4. Sequence account withdrawals
Traditional Retirement Advice
• Claim Social Security early
• Draw upon taxable, non-retirement accounts first
• Leave IRA accounts alone until age 73 RMDs
Wiser Way to Examine
• Delay and strategize Social Security claiming decision
• Draw down RMD account funds early (i.e., age 62 to 70)
• Lower IRA RMDs later may reduce taxes on SS

8. Required Minimum Distributions (RMDs)
RMDs start at 73,
if not 72 by Jan 1, 2023.
May start withdrawing at 59 ½
without penalty
401ks, traditional IRAs, SEPs,
SARSEPs, SIMPLE IRAs, etc

9. Ted and Alice – Case Study
Taxable Income filing at 62
Important to review this case
study in detail!

10. Taxation Impact Case Study – Ted and Alice
Taxable Income filing at 70
Total taxable income from filing
later is lower.
Combined income only includes
50% of Social Security income.
Higher portion of income from
benefits can reduce taxation.

11. Ted and Alice – Case Study

12. Program Solvency
1983 Amendments meant to extend solvency until 2020
This has been exceeded! Solvent until 2034 currently.
The excess funds will then run out if no action is taken, and the system will again be
“pay as you go.” Currently about 3 workers per retiree.

13. Possible parts of the solution
• Change COLA determination
• Increase retirement age or
eligibility age
• Modify PIA calculation
• Increase payroll taxes
• Increase/eliminate
maximum taxable earnings
• Modify benefit taxation
• Invest trust funds
• Modify family benefits