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As retirement inches closer — when it's, say, five to 10 years away — it's likely you'll have mixed feelings of nervousness and excitement. You've saved diligently, your 401(k) has grown and you may even be ahead of schedule. But you may still be wondering, "What's next?"
The truth is, the closer you get to retirement, the more complicated the answers can become. At this stage, retirement planning is no longer just about investment performance and building up your savings. Rather, it shifts to a stage of preservation and protection, focusing on strategies such as income planning, tax mitigation, health care and estate planning.
The problem is that most Americans in this stage of life fall into what I like to call the underserved majority — households with between roughly $500,000 and $5 million in assets. This group represents a huge portion of the population, yet they often fall through the cracks of the financial industry.
In the world of wealth management, the extremes tend to get the most attention. New investors are courted by digital platforms and entry-level brokers designed to make buying and selling financial assets a low-cost, user-friendly service. The ultra-wealthy, those with $10 million or more, are served by private client divisions that coordinate every aspect of their financial lives, from tax attorneys to estate planners.
But in the middle sits the largest and most underserved group: Those who have done well, saved consistently, built meaningful wealth, but don't qualify for the white-glove services offered to ultra-high-net-worth families.
These are the kinds of people we serve at Blue Ridge Wealth Planners. Instead of trying to piece together advice from a number of different sources, our clients can come to us for everything (investments, income planning, tax planning and health care) to ensure all the financial planning pieces fit together.
One of the biggest myths about retirement revolves around how much income you will need. Many retirees assume they'll have to replace all of their pre-retirement income to maintain their lifestyle. Fortunately, that's rarely the case. Once you stop working, several major expenses go away. You're no longer contributing to a 401(k), and you won't have to pay FICA payroll taxes.
Depending on where you live, retirement can also result in lower federal and state taxes. For example, if you live in a state like Tennessee, you won't pay any state income taxes. So, if you're used to earning $150,000 a year, you may not need anywhere near that amount in retirement to maintain your standard of living.
Taxes are one of the largest and most underestimated expenses for retirees, just behind health care. Knowing how to navigate the tax conversation can determine how long your money lasts. Coordinated planning becomes invaluable here. Retirees can reduce the impact of taxes on their nest egg by:
When ultra-high-net-worth investors work with a major firm, they coordinate with their CPA, estate attorney and investment team. Most retirees who are considered middle wealthy don't get that same level of attention and service. The result is a planning gap, where each piece of the retirement planning puzzle is handled separately, without communication between those financial professionals.
At Blue Ridge Wealth Planners, we coordinate, at the client's direction, with their existing professional advisers, such as their CPA and estate planning attorney, to help align financial planning, investment strategy and retirement income goals. Integrating tax and investment strategies may reveal opportunities for Roth conversions or charitable distributions that an adviser focused only on investments might overlook.
Regardless of how much you have in savings, you still have significant decisions to make that could affect your future. If you're approaching retirement, evaluate whether your adviser is providing holistic guidance or just managing investments. A team that helps you make smarter, more coordinated decisions will ultimately lead to sustained long-term success.
Conversations around your finances and estate should never occur separately. At Blue Ridge Wealth Planners, we take the complexity out of financial planning, helping clients create a plan for everything, from investments, income, taxes, healthcare and your legacy.
Disclosures: The information contained herein and any opinions expressed are provided for informational purposes only and should not be construed as a solicitation to buy or sell any security, or as personalized investment, tax, or legal advice. Originally published at https://www.kiplinger.com/retirement/retirement-planning/middle-wealthy-retirees-how-to-find-financial-advice-that-works.
As a former football player at the University of Tennessee under Coach Phillip Fulmer and a high school state champion wrestler, John Vandergriff brings a team-first mindset and disciplined approach to serving clients at Blue Ridge Wealth. After spending five years in ministry and coaching, he joined the firm in 2012 and has since become a trusted advisor and leader, helping individuals and families pursue their financial goals with clarity and confidence.
John is a dually licensed Insurance Agent and Investment Advisor Representative. He holds a Bachelor of Arts in Psychology from the University of Tennessee, combining his understanding of people with a thoughtful, relationship-driven approach to financial planning.
Outside the office, John remains active in his church through teaching and enjoys golfing, exercising, watching sports, and spending time with his wife, Ashley, and their two children.
