Retirement isn't an event.
It's a plan you live out.
When retirement is one to three years away, small timing decisions often have outsized consequences. This guide helps you focus on the choices that shape income, taxes, and flexibility before they quietly become permanent.
Most retirement mistakes aren’t investment mistakes
One to three years before retirement is a deceptively quiet window. The big questions feel mostly answered, but the decisions being made during this period often shape taxes, income, and flexibility for the rest of retirement.
Many people focus on whether they’ve “saved enough.” Fewer step back to examine how and when money will actually be used. That’s where problems usually show up later.
This phase isn’t about predicting markets. It’s about aligning timing, tax strategy, and income in a way that holds up under real life.
Decisions around when to retire, claim Social Security, or take income often get made independently even though they’re tightly connected.
Retirement often shifts your tax picture more than expected. Without planning, higher future tax brackets can show up quietly years before you realize it.
Some decisions made now reduce your ability to adjust later— even if circumstances or priorities change in ways you didn’t anticipate.
Whether you work with a planner or not
Most people come to a financial advisor at this stage asking some version of “do I have enough?” It’s the right question, and we bring a level of detail to answering it that we think is genuinely different. But there are things worth sitting with before that conversation happens, regardless of who you work with or whether you work with anyone at all.
Your financial life is about to change. Drastically.
The shift from accumulation to distribution is more than a change in direction. The rules change. The math changes. The approach that worked for the last 30 years (save more, invest for growth, let time do the work) no longer applies in the same way.
In retirement, sequence matters more than averages. A down market in year two of retirement is a fundamentally different problem than a down market in year twelve. Your portfolio is no longer just growing. It’s being drawn on, and the order in which things happen starts to matter in ways it never did before.
This isn’t a reason to panic. It’s a reason to plan deliberately, with eyes open to the new set of variables you’re actually managing.
If you thought taxes mattered while you were working, they matter more now
Every dollar you saved in a pre-tax account (your 401(k), your traditional IRA) has a silent partner: the IRS. You deferred that tax bill for decades. Retirement is when it comes due, and how it comes due is something you have significant influence over if you act before the window closes.
The years just before and after retirement are often the lowest-income years of your adult life, a window where your tax bracket may be more favorable than it will ever be again. Missing that window doesn’t just cost you in year one. It compounds forward through every required distribution, every Medicare premium calculation, every year your surviving spouse files alone.
Tax planning in retirement isn’t about minimizing this year’s bill. It’s about revisiting the decisions you made over a lifetime of saving, correcting what can still be corrected, and preserving as much of what you built as possible.
You’re about to undergo one of the biggest identity changes of your life
We ask every client approaching retirement a version of the same question. Not “what are you retiring from?” but “what are you retiring to?” Most people can answer the first question in a sentence. Far fewer have really sat with the second one.
For many people, work is identity. It structures the day, provides social connection, and answers the question “what do you do?” in a way that feels complete. Retirement removes all of that at once. The financial plan can be flawless and the transition can still be harder than expected if that part hasn’t been thought through.
We’re not therapists, and we don’t pretend to be. But we’ve found that clients who have thought through what retirement actually looks like in practice, how they’ll spend their time, who they’ll spend it with, what they’ll work toward next, make better financial decisions and have an easier time sticking with the plan. The numbers and the life have to hold up together.
“What are you retiring from?” is the easy question. “What are you retiring to?” is the one worth sitting with.
Pre-Retirement Planning Checklist
Financial, tax, and life-planning decisions for the 1–3 years before retirement.
The questions that matter most right now
This stage of retirement planning is less about numbers and more about how different decisions interact with each other over time.
How much you need from your portfolio, and when, drives nearly every downstream decision. This includes coordinating withdrawals, pensions, and earned income if you’re phasing out of work.
The years just before and after retirement often present unique tax planning opportunities that don’t repeat. Missing them can increase lifetime taxes significantly.
Claiming decisions are permanent and interact with taxes, spousal benefits, and portfolio withdrawals more than most people expect.
The goal isn’t eliminating risk—it’s making sure your plan can absorb market volatility early in retirement without forcing bad decisions.
How we model retirement decisions
Most planning tools answer one question: “Is this plan likely to work?” That’s worth knowing. But it doesn’t tell you much about the next three years, which is when the most consequential decisions get made.
We look at retirement differently: understanding how cash flow, taxes, and constraints change from one year to the next—not blended into a long-term average. If you want to see exactly how that works, the section below explains it.
Most planning software answers one question well: “Is this plan likely to work over 30 years?” That’s worth knowing. But it doesn’t tell you much about the next three years—which is exactly when the most consequential decisions get made.
We build retirement cash flow models year by year, explicitly. Income, withdrawals, taxes, and Social Security are treated as individual line items for each year—not blended into a long-term average. It’s the same approach used when modeling a complex system under load: you don’t just ask whether it works on average, you ask where it fails and why.
Each year of retirement gets its own income, withdrawal, and tax picture. Surpluses and shortfalls become visible before they arrive, not after.
Roth conversions, withdrawal order, and Social Security timing all interact. We evaluate which specific years each move helps—and which years to avoid.
Some thresholds trigger real costs if crossed in the wrong year: tax brackets, IRMAA tiers (Medicare premium surcharges), and RMD timing. Avoiding them often matters more than chasing a slightly better return assumption.
Retirement planning is less about maximizing outcomes and more about avoiding constraints that permanently narrow your options. Widower tax compression, IRMAA exposure, and required distribution timing all fit this category.
This simplified visual shows how income, withdrawals, taxes, and constraints interact across individual years—highlighting where timing decisions carry the most leverage.
This illustration is representative. Actual planning decisions are customized to each household’s income sources, tax profile, and goals.
Before becoming a CFP® professional, Eric spent twenty years in nuclear engineering modeling complex systems with small uncertainties and real consequences for error. That background shapes how we build retirement plans—not as projections to be optimistic about, but as models to be stress-tested. If you’ve done your own planning in a spreadsheet and want to compare notes, that’s a conversation we genuinely enjoy.
How we typically work through this phase
The goal isn’t to optimize everything all at once. It’s to create a clear decision sequence so one choice doesn’t accidentally undermine another.
Stress‑test the retirement date
We start by testing whether your intended retirement timing holds up under realistic spending and market conditions.
Map income and tax timing
This includes coordinating portfolio withdrawals, Social Security timing, and tax brackets across years.
Build flexibility into the plan
We preserve optionality so adjustments can be made without locking in unfavorable outcomes.
Related tools and reading
Retirement touches more than just your portfolio. These resources address decisions that often come up during the same planning window.
RMD Estimator
See when required minimum distributions begin and how they layer with Social Security, pension income, and other withdrawals.
Open calculator → ResourceUnderstanding Required Minimum Distributions
How RMDs are calculated, when they begin, and the strategies for managing the tax impact before and after age 73.
Read the guide → ResourceUnderstanding Social Security
How benefits are earned, calculated, and claimed — and why the timing decisions you make have lasting consequences.
Read the guide → ArticleLifetime Gifting Strategies
How strategic gifting during retirement can reduce your taxable estate while supporting the people and causes that matter to you.
Read the article →Roth Conversions: The Window Before RMDs
Why the years between retirement and age 73 are often the best opportunity to convert pre-tax savings — and how to size it right.
Available soonHow Your Estate Plan Changes in Retirement
Beneficiary designations, trust structures, and titling decisions that need a second look once you stop working.
Available soonNot every decision needs to be made now
Some financial moves feel urgent simply because retirement feels close. In reality, certain choices are far easier to make well with a little time and perspective.
Thinking about retirement decisions?
If retirement is on the horizon and you want to pressure‑test your plan before making irreversible choices, a short conversation can help clarify which decisions deserve attention now.
No pressure. Just thoughtful planning.
Ready when you are.
No preparation needed. Bring whatever questions you have.