We do love it when someone refers a family member or friend to us. Sometimes the question is, “How can we introduce them to you?” Well, there are multiple ways but a very easy way is to simply forward them a link to this webpage.
Here are this week’s items:
How to Retire at 62 – All the Numbers You Need to Know
Radon Stancil and Murs Tariq continue their discussion from Episode 292 on How to Retire at 62. In this follow-up, they welcome their team member, Taylor Wolverton, to dive into the numbers of a real-world retirement financial plan. Together, they walk through detailed retirement scenarios for someone looking to retire at 62, highlighting critical strategies…
How to Retire at 62 – All the Numbers You Need to Know
We show you all the numbers and scenarios you need to consider when planning to retire at 62. Whether you’re looking for a realistic retirement income strategy, Social Security timing advice, or answers to questions like.…..
Retiring at 62 is a dream for many people, but it can also feel overwhelming without the right plan in place. You might be asking yourself questions like: How much do I need to retire at 62? or Will my savings last throughout retirement? These are important concerns that require clear answers and a well-thought-out financial strategy.
At 62, you’re at a unique crossroads. You may be eligible to begin receiving Social Security benefits, but should you take them early, or wait for a higher benefit later? You’ve likely spent years contributing to a 401(k) or other retirement accounts, but how do you turn those savings into reliable income? And what role does inflation play in your ability to retire comfortably?
In this blog, we’re going to show you all the numbers and scenarios you need to consider when planning to retire at 62. Whether you’re looking for a realistic retirement income strategy, Social Security timing advice, or answers to questions like How much to retire at 62? This comprehensive guide will give you the clarity you need.
Using a financial plan example, we’ll explore every critical detail: income, expenses, inflation, and even what happens if you decide to work part-time. By the end, you’ll see exactly what it takes to retire at 62 and feel confident about your future.
If retiring at 62 is your goal, it’s time to take action. Let’s dive into Cindy Martinson’s story to see how you can secure your retirement and enjoy your golden years with peace of mind.
Setting the Stage for Retirement Planning at 62
Let’s introduce Cindy Martinson, a 61-year-old professional earning $200,000 per year. She has done a great job saving for retirement, accumulating:
401(k) Balance: $1,000,000
Cash Savings: $50,000
Brokerage Account: $200,000
Cindy’s goal is to retire in June 2026, when she turns 62. Her monthly expenses are $6,000, and she wants to know: Will her retirement plan work?
To answer this, we’ll walk through her numbers step by step, showing you how to plan for retirement at 62, including Social Security at 62, 401(k) withdrawal strategy, and inflation factors.
Step 1: Retirement Income at 62
One of the first steps in building a retirement financial plan is identifying income sources. For Cindy, her income will transition as follows:
2026 – The Year She Retires
Salary Until June: $83,000 (partial year of work)
Social Security: Starts in June at $13,000 for the remainder of the year.
By 2027, Cindy will receive her full annual Social Security benefit of $27,097. While some may delay Social Security for higher payments, starting at 62 made sense for Cindy’s retirement income strategy.
Note: Social Security benefits can increase over time due to cost-of-living adjustments (COLA). However, to keep the plan conservative, we assumed no COLA increases.
Step 2: Expenses and Inflation
Cindy’s current monthly expenses are $6,000, or $72,000 annually. However, inflation means her costs will rise over time. We included a 3% annual inflation rate in her retirement financial plan. Here’s what her expenses will look like as she ages:
2026 (Age 62): $74,160
2036 (Age 72): $96,000
2046 (Age 82): Over $129,000
Inflation is often overlooked, but planning for it ensures you won’t run out of money as your cost-of-living increases.
Step 3: Retirement Portfolio and Withdrawals
With $1,000,000 in her 401(k), $200,000 in a brokerage account, and $50,000 in cash savings, Cindy’s portfolio starts strong. The question becomes: Can her withdrawals sustain her lifestyle?
Here’s a breakdown of her withdrawals:
2026: $6,000 (partial year of withdrawals)
2027: $51,000
2030: $53,000
2040: $60,000
Even with withdrawals increasing over time, Cindy’s balance holds up well. By age 90, she still has $933,000 in her portfolio – a clear sign that her retirement plan works.
The Key Assumptions:
Rate of Return: 6% annually (net of fees).
Inflation: 3% annually.
Social Security: $27,097 per year starting at 62.
Step 4: Required Minimum Distributions (RMDs)
At age 75, Cindy will face Required Minimum Distributions (RMDs). RMDs are mandatory withdrawals from tax-deferred accounts, like a 401(k) or IRA. The IRS forces you to start taking these withdrawals to collect taxes.
The good news is that Cindy’s plan already accounts for RMDs. Her portfolio balances and cash flows remain stable even after the withdrawals begin.
What If Cindy Works Part-Time?
Many people hesitate to fully retire at 62, so we ran an alternative scenario for Cindy. She asked: What if I work part-time until I’m 65?
In this scenario:
Cindy earns $50,000 per year working part-time.
She delays Social Security until age 65, increasing her annual benefit to $33,548.
The Impact on Her Retirement Plan
By age 90, Cindy’s portfolio balance grows to $1,465,000 (instead of $933,000). Working part-time gives her more flexibility and financial security.
This example shows how even a small change, like part-time work, can significantly improve your retirement plan.
The Importance of Flexibility in Retirement Planning
Retirement planning is not a one-and-done process. Life changes, goals shift, and your plan needs to adapt. For Cindy, having a live retirement financial plan allows her to:
Adjust her retirement scenarios (e.g., working one more year).
Explore different withdrawal strategies.
Account for changes in expenses, income, or market returns.
Annual reviews ensure her retirement plan stays on track, no matter what life throws her way.
Key Takeaways: How Much Do You Need to Retire at 62?
To retire comfortably at 62, here are the critical factors to consider:
Current Savings: Cindy’s $1,000,000 401(k) gave her a strong foundation.
Expenses: Know your monthly and annual spending needs.
Inflation: Plan for rising costs (3% annually is a safe assumption).
Social Security: Starting at 62 worked for Cindy, but delaying can increase benefits.
Withdrawal Strategy: Managing how much you withdraw ensures your portfolio lasts.
Flexibility: Consider part-time work or delaying retirement for added security.
If you’re asking yourself, How much do I need to retire at 62? the answer will depend on your unique situation. A personalized financial plan is the key to retiring comfortably and securely.
Ready to Secure Your Retirement?
If you want to understand all this a little better, we offer a complimentary phone call that you can schedule with us on our website. If we can’t answer all your questions in just 15 minutes, we’ll guide you to the next steps to find the answers you need.
Retirement at 62 is achievable with the right plan in place. Whether you’re planning your Social Security at 62, optimizing your 401(k)-withdrawal strategy, or exploring retirement income options, having a clear financial plan will give you peace of mind. Start planning today to ensure you can enjoy retirement comfortably and securely!
Financial advisors can help you invest and manage your money. An advisor helps clients reach their long-term financial goals and often play an integral part in the retirement planning process.
But there’s one question many clients have: what happens to my money if something happens to my advisor?
Your advisor opens your accounts, sends you reports and provides a hands-off way to secure your retirement. If these individuals die or become incapacitated, your money will still be safe and will still be your money.
What Happens to My Money if My Advisor Retires, Gets Sick or Dies?
As an advisor, 90% of our clients ask us this very question. It’s an excellent question to ask, and it’s one that we want to clear up for you. No matter who you’re working with, the logic and answers will be the same across the board.
But before we get too far ahead of ourselves, it’s crucial to have a firm understanding of where your money is held.
Understanding Where Your Money is Held
When you work with us or any independent financial advisor, your money never enters our bank account. In fact, our name is never on the checks that you write. Instead, you assign us as an advisor on your account.
A third-party custodian will be where your money is held.
These custodians are massive financial institutions, such as Wells Fargo or Charles Schwab. The custodian will house your money, ensure everything is compliant and facilitate the trades.
As independent advisors, we:
Act on your behalf when dealing with a custodian
Never actually hold your money
If something happens to your advisor or us, your money will still be sitting in the custodian’s accounts that we created for you.
What Happens When Working with Big Financial Firms?
If you work with a big financial firm, you may assume that if your advisor is no longer working with the firm, you’ll be working with another internal advisor. And you will be working with another advisor, but it’s essential to understand that these firms operate in what’s called “teams.”
Teams have multiple advisors, so if something happens to the leading advisor, you’ll work with someone else in the company.
In fact, you’ll receive a call from your new advisor and will need to decide whether or not to work with the team without the advisor you had. Your money remains in place, and if you choose to leave the team, you can just transfer your money to another advisor.
So, in short: you won’t lose your money and can decide on what to do next with your portfolio.
Common Scenario Questions People Ask
Your money is important to you, and it’s essential to know the answers to common questions regarding your advisor:
What Happens if Your Main Advisor Dies?
First, you’ll get a new advisor. But the process will go something like this. You’ll receive a phone call and the new advisor:
Will explain that they have been assigned to your account
Likely have you come into the office to learn about him/her
You should ask to meet the advisor and go through the initial decision stages again, just like you did when choosing your original advisor. What this means is that you’ll want to:
Talk to the advisor and see whether your personalities match
Understand the advisor’s investment philosophy
Decide if the philosophy is good for you
If you’re working with teams in the same office, you can be relativelyconfident that their philosophies will match. You won’t even need to worry about the investment strategy if working with an advisor from the same team.
This is the best-case scenario.
When working within the same team, your biggest concern will be whether the new financial advisor is a good fit for you. If the advisor isn’t a good fit, you can switch to another member within the same team.
What Happens If Your Financial Advisor Retires?
Retirement scenarios are a little different than if someone quits, gets sick or even dies. If an advisor is retiring, they’ll let their clients know well ahead of time. There is a lot of planning that goes into the retirement process, so you have many options as a client.
Your advisor can also choose to retire and:
Sell their practice, in which case, you can begin working with the new team.
Let the current in-house team take over the account. The long-term advisor leaves, but you continue working with the team that you’ve known for years.
If you’re concerned about your advisor leaving, it’s important to ask about their continuity plan for your team. You can ask your current advisor this question and ask this question when looking for an advisor.
Most advisors will have a plan in place to help you transition if they get hit by a bus tomorrow.
And a lot of people will shop for a new advisor when they know that their name advisor is going to retire.
We’ve had potential future clients come into our office, vet us thoroughly and explain that they plan to stick with their current advisor until that individual retires. You can follow this same concept because, at the end of the day, it’s your money that a new advisor will need to handle.
You’re not restricted to working with just the team that your old advisor built either.
Final Note
You’ll work closely with an advisor, build trust and hopefully make a lot of money together. Then, if your advisor is hit by a bus or decides to quit tomorrow, there will be someone that can confidently fill their shoes.
Often, you’ll have the option of working with the advisor’s team that they were a member of to make the transition as fluid as possible. And in all cases, you’ll still have all the money you invested accessible to you.
Retirement planning has a lot of moving parts, and if you’ve been reading our blog or listen to our podcast (listen here), you know that we’re big on creating a holistic retirement financial plan.
We believe that you should have a retirement plan that is well-put-together and really hits on all of your goals.
How can you create this plan?
With a team.
We’re going to help you start to secure your retirement with a quick overview of what your retirement financial plan team should look like.
Retirement is a Lot Different than Most People Realize
A lot of people think about their retirement briefly while they put money into their 401(k) plans, and a lot of people know when they want to retire and take social security. But when you sit down and get closer to retirement, you’ll realize that there are a lot of moving parts to consider.
Retirement is more than just putting money away, although money plays a big role in retirement.
And when you begin doing your research, you’ll find a lot of advisors to choose from, which can make your head spin. We’re going to discuss the key people that should be involved in your life and can help you retire the way that you want.
Advisors to Hire and Work with to Secure Your Retirement
Advisors help you go well beyond just a 401(k) and saving money. These professionals will assist you with investing your money in many cases. For example, you may have an advisor that works with your employer and will:
Assist with asset allocation
Invest for you
Offer a quarterly report
Provide yearly statements
These advisors work with money management, but they fail to look at the whole of your retirement.
We take a holistic approach to retirement. For example, you’ve received a paycheck from an employer, and now that you’ve saved money to retire, it’s time to pay yourself. You have access to this money at any time, but if you’re spending way beyond your means, your retirement buckets can quickly dry up.
An advisor that works to invest your money only isn’t considering how you’ll pay yourself.
You’ve saved and grew your money, and that’s where a lot of advisors stop. They don’t consider how you’ll manage your money after retirement, nor will they continue checking up to understand your goals. As your goals change, your asset allocation should also change.
Money managers grow and build money; not plan for when you want to retire.
Holistic advisors tend to look at your retirement plan as a whole. There’s a lot to consider, so these individuals will discuss your retirement desires with you and help make retirement possible.
Types of Advisors to Work With
You may work with a variety of advisors, including:
Money manager or financial adviser. These professionals will be focused on investing and growing your money.
Tax advisor. A tax advisor is key because they’ll help you find innovative ways to shelter a lot of the money that you save for retirement so that you don’t have to pay it in taxes. Imagine needing $1 million to retire and not realizing that you owe $250,000 in taxes.
Estate planner. An estate planner will help you with ensuring that all of your documents are in order so that if you become incapacitated or want to leave assets to children or family members, you can.
Social security specialists. These individuals will help you determine the best time to apply for social security. They’ll also assist you with maximizing your payments by retiring later.
Insurance experts. An insurance expert can help you obtain the best life insurance or health insurance just in case you or a spouse pass on.
No one is a master of all aspects of retirement, but with the right team, it’s possible to bring the collective knowledge of these professionals together in one place.
Working With a Holistic Team
A holistic team, like us, will help with all aspects of your retirement. We always start with your retirement plan, which is an extensive plan that looks at your retirement goals, needs, and the “what ifs” that pop up before and during retirement.
Comprehensive plans can and should be updated annually, and they’re a clear roadmap to your retirement.
Once we have this plan in place, you can sleep better at night. You’ll know what it takes to retire and can follow a roadmap to success.
And since we’re a holistic advisor, we bring in:
Tax advisors
Social security specialists
Other advisors
Your team must look at your goals, and how they change, so that you can confidently enter retirement. Working on just investing your money isn’t enough to retire. Bringing together the right team that offers a holistic approach will look beyond your investment portfolio and really bring everything together, from social security, to tax considerations and so much more.
