A large part of my practice is putting together, and tweaking retirement plans for my clients. You know what they say about the best laid plans…..I say, expect the unexpected.
Things happen that we cannot control such as, getting laid off two years before your planned retirement, or a family member getting so sick that you now have to be a primary caregiver. There are all types of family emergencies that we would not think twice about tapping into our reserves to help resolve. Just think if you pulled $20,000 out of your retirement account to help with a family emergency when you were age 60, you might not have enough time on your side to make up for that generous withdrawal. You will now have to look at your retirement plans and decide what you will pull back on, or completely cut out. If you had made this type of withdrawal in your 50’s, you may pay a tax penalty, but you would have time on your side to allow your assets to replenish. The thing is, can you expect these emergencies? Most of us cannot.
Imagine that you retired in 2007 with a very healthy retirement portfolio, then the market crash of 2008 occurred, what could you do? One thought is to rein in your spending until you can recover. While no one likes to cut back their lifestyle in retirement, often due to the unexpected, change is necessary.
My advice is to save as much as you can pre-tax through your company retirement plan, add additional savings outside of that in a variety of investments from cash accounts to equities. Hire a professional to help you manage your retirement investments so they can, without emotion, re-balance your portfolio regularly, and hopefully not get hurt too much when an unexpected event enters your retirement.

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