Helping you create a retirement income plan
Case Client: Tom & Margaret
• Age: 68 & 66
• Occupation: Retired Sales Executive from Coca Cola's headquarters in Atlanta Georgia & Retired Teacher
• Primary goals: Coordinate income from Social Security, pension, and rental property; manage required minimum distributions (RMDs); implement tax-efficient withdrawal and charitable giving strategies; and ensure long-term sustainability of their retirement plan.
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Overview
Tom recently retired from a career in sales, while Margaret wrapped up her career as a teacher with a pension benefit. In addition to their retirement savings, they own a rental property that provides consistent income. They wanted to make sure their mix of income sources worked together efficiently, minimizing taxes and supporting both their lifestyle and charitable goals.
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Our Approach
Social Security, Pension & Rental Income Coordination
- We analyzed different scenarios for when Tom should begin claiming Social Security to maximize lifetime benefits, while coordinating with Margaret’s pension.
- The rental property provided steady income but added tax complexity. We helped them integrate it into their overall retirement income plan.
- We reviewed survivorship options for Margaret’s pension to ensure income security for whichever spouse outlives the other.
Tax Planning & RMD Management
- We built a forward-looking tax strategy that considered three phases: current retirement years, the start of Tom’s RMDs, and when both spouses are taking RMDs.
- By layering in rental income, we modeled how different withdrawal sequences could keep them in a lower bracket.
- We scheduled partial Roth conversions in lower-income years to help reduce future RMD pressures.
Charitable Giving Strategies
- Tom & Margaret regularly supported their local community center. We compared strategies for giving through a donor-advised fund now versus using qualified charitable distributions (QCDs) once Tom turns 70½.
- This allowed them to give generously while also lowering taxable income.
Investment Management & Risk Strategy
- Their investment accounts had grown without much oversight. We restructured their portfolio into a bucket strategy:
- Short-term: cash and bonds for near-term needs.
- Mid-term: balanced investments for the next decade.
- Long-term: growth-oriented assets for later years and legacy.
- We optimized tax location, placing bonds and income-generating investments in IRAs while holding index funds in taxable accounts.
- A rebalancing schedule was set to manage risk and keep investments aligned with their income plan.
Estate & Legacy Planning
- Tom and Margaret hadn’t updated their estate documents since their children were young. We worked with an attorney to revise their wills, powers of attorney, and beneficiary designations.
- We ran a survivorship analysis to ensure Margaret would remain financially secure if Tom passed first, and vice versa.
- Lifestyle & Travel Planning
- They mentioned a long-standing dream to visit the U.S. National Parks. We incorporated these trips into their spending plan, showing how they could fund travel without disrupting their long-term security.
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The Results
By integrating their pension, Social Security, rental income, and investments into a single strategy, Tom & Margaret now have confidence that their retirement is sustainable. They know when to claim benefits, how to manage taxes, and how to structure withdrawals to keep their plan on track. With clear estate planning updates and charitable giving strategies, they feel prepared not just for today, but for the years ahead.