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Three Retirement Decisions That Matter More Than the Hype
Most retirees don't move, bucket strategies need a withdrawal plan, and the 'three haves' framework decides timing. Christine Benz's book offers practical guidance on these retirement decisions.
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Christine Benz's book How to Retire keeps delivering practical frameworks. The latest chapters cover bucket strategies, the decision to relocate, and what retirees can actually control.
The bucket strategy, simplified
The idea is straightforward. Hold cash to cover living expenses during market downturns so you never sell stocks at a loss. Benz defines it as "holding cash reserves that can be used to meet living expenses in periods when the long-term portfolio has lost value."
Most versions use three layers. Cash for the first two to three years. Bonds and CDs for years three through ten. Stocks for everything beyond that. Benz adds a fourth bucket for long-term care, segregated from the spendable portfolio. That feels like overkill to me. Big costs like weddings or college fit better inside a regular budget.
The withdrawal order matters more than the bucket labels. Taxable accounts go first. Tax-deferred accounts come next. Roth accounts, which sit longest, should hold stocks. Accounts that get tapped early should hold safer assets.
Moving in retirement is harder than the clickbait suggests
Mark Miller, an author interviewed in the book, makes a point that should be obvious. It often isn't. Most people do not move when they retire. The media myth of the sunny tax-friendly relocation sells articles, not reality.
If you do move, Miller recommends asking about healthcare access, walkability, and proximity to family before thinking about taxes. "Making that a primary factor is a tail wagging the dog approach," he says.
I moved from Colorado to Florida and took the hard road to get settled. The lesson: if you like where you live, think very carefully before leaving. Miller suggests resources like AARP's Livability Index and Sperling's Best Places for initial research. I would add that you should visit the candidate location and live there as long as possible before committing. Try to prove the move is a bad idea. If you cannot, you might have found the right place.