Plan Architecture

Are Your Clients' Retirement Resources Working Together?

Changes in one funding source often affects others

It is human nature to make decisions one at a time, says retirement income plan architect and CFP™ Travis Chance. Unfortunately, what seems like a good idea in one area of retirement planning can prove ruinous in another, he says.

“Designing a good retirement plan is like designing a house: you can’t plan one room without consideration of the entire structure,” says Chance, president and founder of CFG Wealth Management, LLC., (, and CFG Insurance Planning.

“But that’s exactly what people do when they make changes in one aspect of retirement funding without consideration of other sources. The-more-the-merrier approach for money in retirement is too simplistic.

That would be like saying ‘the bigger the house, the better.’ At some point a huge house becomes a burden that becomes a burden for many. Likewise, maximizing money with one source can cost you elsewhere.”

Reliable fund strategies

While most baby boomers are concerned over the soundness of their retirement income plan, many do not acquire professional help. Chance, a Retirement Income Certified Professional®, explains what to look for and avoid when crafting a reliable funding strategy.

  • Hope for the best, but plan for the worst
    There are three major sources funding the average retirement: Social Security, pension/IRA income and profit savings. Much of the time, when you decide to alter how you receive money in one area, it changes conditions elsewhere. Case in point, Chance recently spoke to a couple in which the husband was to receive a substantial pension. In order to enjoy that money at an earlier age, they were going to retire early. However, if the husband were to die early, the wife would lose that pension money and suffer a significant percentage loss in Social Security by claiming early.

    “Of course, women tend to live longer,” Chance says. “She could face a long life without the financial support in the case of her deceased spouse.”

  • Avoid the ostrich response
    Many pre-retirees are not fully confident in the robustness of their portfolio. Rather than taking a comprehensive approach to understanding and building a strategy, many decide to make a short-sighted decision, as mentioned above – or nothing at all. However, if it turns out that you need to work until 70, wouldn’t you want to learn this well in advance? According to the 2013 Risks and Process of Retirement Survey Report from the Society of Actuaries, just 52 percent of pre-retirees and 44 percent of retirees consult a financial planner or adviser. Professional support may not only help an individual’s money go further, but also adjust to changing laws, protect wealth and know when a safe age may be to receive Social Security benefits. Each portfolio is unique.
  • Know your risk power, and beware overconfidence in a nest egg
    In today’s volatile market, it’s crucial to know what you’re risking in retirement. The 60/40 stock/bond portfolio is often used as a simple benchmark for a balanced asset allocation, but depending on your goals and resources, that may not be a great ratio.
Designing a good retirement plan is like designing a house: you can’t plan one room without consideration of the entire structure

Also, in your accumulation phase, you may have saved more than you could have imagined – $500,000 or more in some cases! Contingent upon the other moving parts of your plan, that may not be too much. Given a 60/40 portfolio, it’s usually recommended to take out just 3 to 3.5 percent annually from your nest egg, and adjusting for inflation. With $500,000 in savings, that equates to between only $15,000 and $17,500 per year.




About Travis Chance, CFP®, RICP®, CLTC®
Travis Chance ( is a CERTIFIED FINANCIAL PLANNERTM, and has been awarded the Retirement Income Certified Professional® designation through the American College. His financial planning practice, CFG Wealth Management, LLC, covers South Georgia and South Carolina low country residents over age 50. Chance specializes in the Retirement Income Planning area, and speaks regularly to groups on this topic.
He holds a Bachelor’s of Business Administration degree from Georgia Southern University, and a Financial Planning degree from Kaplan University.