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Three metrics we use to measure retirement strategies

Three metrics we use to measure retirement strategies

October 26, 2022

One thing I love about my job is seeing the light bulb go off for a client.

In many cases, people can receive financial “advice” on retirement for decades—putting away money into their employer 401(k) or an IRA. They go through the motions, but their vision of what the future will actually look like is fuzzy.

Retirement is the number one financial goal for Americans,1 yet only 21% of people believe they are on track with their retirement savings.

More importantly, 16% say they don’t even know where they stand for retirement readiness.2  

Part of being a planning-first firm is that we start with the big picture of what each client’s life would look like 5, 10, 20 years into the future. Then, we assess the current situation and map out a clear path from here to there. 

Retirement is almost always in this big picture view, and we use three metrics with clients to both assess their current retirement preparedness and establish a strategy for getting them on track:

1. Retirement income expectations

Occasionally, someone comes into our office who is truly confident about their retirement account balance. Perhaps they’ve put away a recommended percentage for many years or hit a milestone dollar amount.

However, as we start asking questions about the lifestyle they envision for their golden years, a disconnect emerges between the balance and the desired future. Retirement, at least the retirement they have in mind, it more expensive than they imagine. 

The cost of retirement is different for every person: It depends on where you plan to live and if you choose to downsize, whether you’d like to work past 65 or take an early retirement, your estimated lifespan and potential long-term care needs, if and how you may want to support loved ones, and what type of legacy you hope to leave.

Retirement calculators can be helpful in terms of replacing your income in retirement years, but they don’t account for those lifestyle changes and expectations that come up in conversations with someone who knows the right questions to ask.

We talk about retirement early and often with our clients and build financial strategies around the desired outcome.

2. Monthly retirement contributions

Once we have a personalized retirement goal established, we can begin projecting what contributions are needed to reach that intended balance at the intended date.

This is where visual tools come in handy. We walk our clients through what retirement could look like depending on how much they can contribute, including retirement dates and lifestyle expectations.

Then, since we perform comprehensive planning for all aspects of a financial life, we coordinate those contributions with income, cash flow, and risk management solutions.

Taking a holistic approach is helpful at this step, as we help you balance life’s uncertainties and work toward large goals—cutting insurance payments is rarely a wise strategy for hitting retirement goals if it leaves you open to risk. On the flip side, you may be spending money on products that are much less valuable to your overall financial health than a solid retirement would be.

3. Types of growth

Finally, once your goal is solidified and your contributions are set, it’s time to put your invested money to work toward your goals. We do this by balancing your accounts with fund choices coordinated with your time horizon.   
This is an opportunity we see many individual investors mismanage.

If your balance is distributed among funds that are too conservative for your time horizon, you’ll miss opportunities to maximize growth over the decades. However, if your accounts are invested in products that are too aggressive, you may be putting yourself in a risky situation of losing your portfolio. 

Are you on track for retirement?

To succeed with retirement savings, you need to make it real. You need to be able to define and envision the retirement you’re aiming for. 

Then, you can create actionable goals in your current life stage that balances every aspect of your financial plan. 

Finally, you need to distribute your retirement assets strategically to make the most of high-growth funds yet balance them with safer solutions, and restructure accounts as you progress toward your retirement date.  

The important thing to remember in all of this is that you don’t need to be an expert. People make most of their financial mistakes when they don’t have enough education or enough perspective. As comprehensive planners, we help with both. We provide simple explanations of complex topics and put them into the framework of your complete financial health, allowing you to make decisions confidently.

Ready to get clear on your path toward retirement? We’re here to help.

1. Saad, L. (2022, May 16). Americans’ financial worries tick up in past year. Retrieved August 9, 2022, from

2. Royal, J. (2021, November 17). Survey: More than half of American workers feel behind on retirement savings. Bankrate. Retrieved August 9, 2022, from

Separate from the financial plan and our role as financial planner, we may recommend the purchase of specific investment or insurance products or accounts.  These product recommendations are not part of the financial plan and you are under no obligation to follow them.