library3Nobody wants to run out of money in retirement, so many people go out of their way to ensure that doesn’t happen. Others, however, exhibit certain types of behaviors, which over time, may prove detrimental to their long-term retirement plans. Regularly tapping into savings can happen for a number of legitimate reasons… be it for adult children, an aging parent, or personal / medical emergency. However, there are three actions that investors take when they don’t want to make changes to their withdrawal strategy but may need to. Avoiding Statements Some people may prefer not to open a statement after a tough month or difficult quarter in the stock market. However, investors who are taking withdrawals and avoid opening statements are often employing a faith based strategy that’s unsustainable. They simply “hope and pray” that they can just keep on going without any repercussions… and not opening their statements allows them to deny the reality of the situation. Unfortunately, they have to face the music at some point, typically acknowledging they knew things were spiraling out of control and just didn’t want to address them. Permission Free Withdrawals Most retirement plan withdrawals are structured and consistent simply because there are tax implications where rules must be followed and appropriate forms completed. It may seem silly to have to jump through so many hoops to get your own money, but the process enables investors to develop and follow a plan. The trouble comes in with funds that are outside the confines of an IRA, 401(k), or 403(b) type plan. Whether it’s an inheritance, work place settlement, or just traditional savings, most brokerage companies don’t require a signed document to access these funds… and some offer check writing privileges. This unique feature complicates traditional planning strategies because of the easy access and lack of accountability. That’s not to say people can’t use their funds as they see fit, rather it highlights a potential withdrawal trap that can quickly get out of control if the plan to pull funds isn’t coordinated and managed with other drawdowns. Too often these outside funds can foster a lifestyle that is unsustainable once they are gone and there are only retirement accounts left to tap. Helping Uncle Sam Another obvious symptom of excessive withdrawals can be hefty annual tax payments. This topic can be a little more complicated and may differ for each retiree based on their age and timeframe for taking Social Security. Therefore, suffice it to say that if you complete your taxes each year and find yourself owing more money than the previous year or find a portion of your Social Security being taxed, it may be a sign that your withdrawing too much money from your retirement accounts. Whether it’s avoiding statements, writing checks, or helping Uncle Sam, the idea of withdrawing too much from your retirement savings can be a hard pill to swallow. However, there is a bright side to it all. Many times, the people we help get their withdrawals under control are relieved once they actually do it. Whether they sell their second car, stop funding an adult child’s failing business, finally agree to downsize, or cut up their credit cards, it all starts by simply acknowledging one or more of these behaviors and picking up the phone to get some professional support. Do you feel like you may be withdrawing to much from your retirement accounts? Ready to sit down with a professional to help you map out a way to make sure you don’t run out of money? Contact us today and put our knowledge and experience to work for you. There is no cost for an initial meeting where we can get to know more about you and discuss next steps to managing your retirement savings. Are you feeling overwhelmed, confused or burdened by your various retirement savings accounts? Looking for someone to help you get things organized and on a track to help you achieve your financial goals? Contact us today and put our knowledge and experience to work for you. There is no cost for an initial meeting where we can get to know more about you and discuss next steps to taming your retirement savings hodgepodge. Click here to schedule or meeting or call (423) 247-1152 to request more information.