4 Keys of Successful Retirement Plans

Here at Lasso, we love featuring financial advisors who really get it, and this week’s article is no different. This piece was contributed by Ian Weiner of Simply Retire.


Long-term retirement planning is like doing a puzzle – but not the kind where you start with the border and then start building the picture one piece at a time.

When it comes to your retirement planning puzzle, step one is deciding what you want the completed picture to look like. No one wants to spend decades of their life piecing a retirement plan together only to discover it’s not really what they wanted.

It’s important to step back and think about what you really want out of your retirement before you start working on your puzzle. That said, there are some common elements to every good retirement plan that you can follow to start piecing together the puzzle you really want.

4 Keys to Successful Retirement Plans

Planning for retirement can be stressful. You know it’s important and you’re ready to get started, but how can you tell if you’re on the right track? Never fear. We’ve collected these four keys of building a successful long-term retirement plan:

1. Visualize Your Goals

Get out your favorite note-taking app: It’s time to get in touch with your inner self through some good old-fashioned journaling. 

Okay, but seriously – the first step for planning your retirement is to figure out what kind of future you want for yourself. It’s something only you can answer. 

Maybe you’ve already got your grand plans to travel the world and swim in every ocean. 

retirement plan

That’s great – but what about after that? 

Don’t underestimate how long retirement could actually be. If you retire at the golden standard of 65, your retirement could last several decades, and you probably won’t be traveling the world that entire time.

A good way to visualize your retirement goals is to ask yourself some basic questions. The 5 “W’s” are a great place to start:

  1. When do you want to retire?
  2. Where would you like to live in your retirement years?
  3. Who do you want to live near or with?
  4. What do you want to do with your time once you’re retired?
  5. Why do you want those things? 

You don’t have to have everything figured out right away, but the answers to these questions will pave the way for you to build your retirement plan and figure out how much money you’ll need to save.

2. Know the Risks

Grandiose dreams are good for the soul, but reality comes with some (very real) risks – and not just from the stock market.

Specifically, there are three primary risks you’ll want to make sure you address – each in its own unique way:

  1. Sequence of returns

This refers to the risk that the rate of return on your investments will drop significantly during your early years of retirement, forcing you to withdraw more money than you anticipated and leaving your portfolio empty sooner than expected.

In other words, if, right after you retire, the market takes a nosedive, your portfolio could be massively depleted, which could be the difference between you having enough money to live off of for the rest of your life, or running out of money while you’re still alive. 

If the market freefalls when you’re in your 30s or 40s, you still have enough runway that there’s a good chance you’ll make it back. While the market typically bounces back from modest declines within a month or so, big drops can take five years or more to get back. For example, the market didn’t fully recover from the 2008 recession until 2013.

So what can you do about this? Spend wisely and stay flexible (more on that later). There are other things you can do, but mastering those two primary tools will go a long way toward protecting yourself from sequence of returns risk.

  1. Tax Risk 

Tax risk is the acknowledgement that tax rates and laws are always changing, and could affect your portfolio negatively in the future.

Tax-advantaged accounts like Roth IRAs can help you protect yourself against unforeseen tax changes in your portfolio. The money you invest in a Roth is taxed before it is invested and the interest it makes is not subject to taxes.

  1. Longevity Risk

Although living forever may seem appealing, a longer life also carries longevity risk, which is basically the chance that you could outlive your money. It’s consistently one of the top concerns among retirees, especially with inflation the way it currently is.

You can do a lot of things to hedge against this risk, from delaying when you claim Social Security to investing in annuities to working with a retirement-focused financial advisor.

Although some of these risks are hinged on factors out of your control, it’s still important to be aware of them and talk through any potential ways to minimize these risks with your financial advisor.

3. Remain Flexible

It’s also important to maintain flexibility in your retirement planning. Your retirement dreams right now will probably look very different than your retirement dreams in several decades, so don’t lock yourself into an immovable path. 

Your life goals will vary as you enter different stages of your life. Just like your goal when you’re 30 years old might be to go skydiving and fall from the sky, your goal at 80 years old might be to not fall at all. Your money habits will reflect these changes – and spending is more of a bell curve than a straight line.

4. Remember: Your Portfolio is a Tool, not a Plan 

A lot of people fall into a trap where they think that because they have an investment portfolio, they are covered for retirement. Your portfolio isn’t a retirement plan – it’s a tool that can be used to financially prepare for retirement. 

A retirement plan can cover a multitude of factors including healthcare, living expenses and much more.

When to Begin Planning for Retirement

The best time to begin planning for retirement? Yesterday. The second best time to start planning for retirement? Right now. It’s all about the long-term.

Time in the market is one of the greatest assets a person can have when it comes to building long-term wealth – so even if you don’t have much to contribute each month to your retirement account, you should still start ASAP. If those little seeds of investment have decades to grow and compound, you’ll likely reap more rewards than if you waited years to start investing. 

But whether your retirement is far in the future or right around the corner, these four key components can ensure you’re on the path to success.

Get Started with Lasso

With Lasso, you can build a custom plan to start saving for the retirement of your dreams. Then, anonymously connect with a financial advisor to take your saving skills to the next level. Ready to see Lasso in action? Download the app to get started.

Featured author

Ian Weiner, CFP®, is the founder of Simply Retire, a comprehensive financial planning firm based in Bentonville, Arkansas, with clients across the country. Simply Retire specializes in providing comprehensive financial planning services to clients who are 3-5 years from retirement, have charitable inclinations and want to retire on their own terms. 

You can find Ian and connect with him in Lasso!

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