Part 3: A Collection of Accounts Is Not a Retirement Plan
Most financially successful households don't lack financial products.
They have plenty of them.
A 401(k).
An IRA.
A brokerage account.
Maybe company stock.
Life insurance.
A bank account.
Perhaps real estate.
Social Security.
Possibly a pension.
The problem is rarely the absence of financial accounts.
The problem is whether all those accounts are working toward the same financial objective.
Because owning financial assets is not the same thing as having a financial plan.
The Planning Gap
The 2025 WSJ Intelligence and Equitable study identified an interesting contradiction among Gen X investors.
They generally consider themselves capable investors and recognize the value of professional advice.
Yet comprehensive planning remains underused.
Only 43% of respondents who had developed detailed plans had done so with financial-professional involvement, while 57% had created their plans independently or with software and other tools.
At the same time, 84% said financial advisors should understand their overall goals, objectives and risk tolerance, while 78% believed advisors should understand their lives beyond their finances.
That tells us something important.
Many people do not necessarily want more financial information.
They want their financial decisions connected.
Investments Are Only One Piece
A retirement plan should coordinate several interconnected areas.
Retirement Income
How much can you reasonably spend?
Where will that income come from?
How will the strategy change over time?
Investments
How much risk is appropriate?
Which assets are intended for near-term needs versus longer-term growth?
Taxes
How will withdrawals affect taxable income?
When might Roth conversions or other planning strategies deserve consideration?
How do investment gains, charitable planning and estate decisions interact with taxes?
Social Security
When should benefits begin?
How does one spouse's decision affect the other?
How does Social Security integrate with portfolio withdrawals?
Healthcare
What assumptions should be made for Medicare premiums, supplemental coverage and out-of-pocket costs?
What happens if long-term care or caregiving becomes necessary?
Risk Management
What financial risks could materially derail the plan?
Which should be insured?
Which should be retained?
Estate and Legacy
Who should receive assets?
Are beneficiary designations current?
Are estate documents aligned with your intentions?
What role does charitable giving play?
A financial plan connects these decisions.
Seven Questions Your Retirement Plan Should Answer
If you're approaching retirement, your plan should be capable of answering at least seven questions.
1. How much will my retirement lifestyle cost?
Not simply your current expenses.
Your retirement lifestyle.
Travel, housing, healthcare, family support and recreation should all be considered.
2. Where will my income come from?
Social Security?
Investment accounts?
Pension?
Business income?
Real estate?
The individual sources matter less than whether they operate as a coordinated system.
3. Which accounts should I withdraw from and when?
Withdrawal decisions affect taxes, portfolio composition and future flexibility.
They deserve more attention than simply choosing the easiest account to access.
4. What happens during a major market decline?
The answer shouldn't be:
"We'll figure it out when it happens."
The strategy should already contemplate difficult markets.
5. How will taxes affect the plan?
Retirement does not automatically mean low taxes.
The type and timing of retirement income can matter significantly.
Tax planning should therefore be integrated with investment and retirement-income planning rather than addressed after decisions have already been made.
6. How will healthcare and caregiving be funded?
Gen X households may be simultaneously concerned about their own future healthcare expenses and the needs of aging parents.
The study specifically identifies healthcare and caregiving as important components of comprehensive retirement planning.
7. What should ultimately happen to the money I don't spend?
Retirement planning and legacy planning are connected.
The study found that 74% of surveyed Gen X investors viewed leaving an inheritance as important to building generational wealth.
The objective should therefore not simply be:
Don't run out of money.
For many families it is:
Live well, remain financially secure and intentionally transfer what remains.
Personalization Matters
Good financial planning cannot be created simply by inserting someone's age, assets and retirement date into software.
Two 60-year-olds with $2 million portfolios may need completely different plans.
One may want to retire immediately.
Another may enjoy working until 70.
One may want to leave every possible dollar to children.
Another may prioritize extensive travel.
One may have healthy parents and financially independent children.
Another may be supporting both generations.
The numbers matter.
But the numbers need context.
That is likely why 84% of the Gen X investors surveyed said advisors should understand their overall goals and 78% said advisors should understand their lives beyond their finances.
The CPA Allies Perspective
Investments matter.
But eventually, investment management has to serve something larger.
A financial plan should give your money direction.
It should tell you:
what you can spend,
what you should protect,
what should remain invested,
where taxes matter,
where risk exists,
and what financial decisions need to happen next.
That's the difference between owning a collection of financial accounts and operating from a financial strategy.
As retirement approaches, that distinction becomes increasingly important.
Source: Based in part on Approaching Retirement: Getting Gen X from Good to Great, WSJ Intelligence & Equitable Thought Leadership Study, August 2025.
Comments