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Five Smart Strategies to Maximize Your Retirement Income

Jar labeled "Retirement" filled with dollar bills and coins, symbolizing retirement savings.
Maximizing your retirement income begins with intentional saving and strategic planning.

Executive Summary

Creating a reliable income stream in retirement takes more than just saving—it requires strategy. In this post, we’ll walk through five smart ways to get the most out of what you’ve built:

  • Get the most from Social Security. When you file matters. Understanding your options—including spousal and survivor benefits—can add up to hundreds of thousands of dollars over time.
  • Withdraw your money tax-efficiently. Where you pull income from each year can impact how much you keep. Coordinating withdrawals across taxable, tax-deferred, and tax-free accounts can stretch your savings and lower your tax bill.
  • Do an annual tax check-up. Your income and the tax rules change every year. Reviewing your situation regularly opens up opportunities—like Roth conversions or tax-smart charitable giving—that can save you money long-term.
  • Watch for policy updates. Shifts in tax law, Medicare premiums, or Social Security rules can affect your plan. Stay informed so you can adjust before small changes become costly surprises.
  • Keep your plan flexible. Life doesn’t follow a spreadsheet. Revisiting your retirement strategy regularly ensures it still fits your goals, your lifestyle, and whatever life throws your way.

In many ways, approaching retirement is like climbing a new mountain. The view at the top is worth the climb—but the journey has its own steep terrain, loose footing, and changing weather to navigate along the way.

Retirement is no different. 

On the one hand, it marks the beginning of a new and exciting chapter, powered by the ability to do what you want, when you want, with the people you want, for as long as you want (which as best selling personal finance author Morgan Housel says: “Is the best dividend that exists in finance.”) But, on the other hand, it also brings unique challenges and unknowns. 

And one of those unknowns is the reality that once you retire, you can no longer rely on your job for a paycheck. Instead, you must create that retirement paycheck on your own, often drawing on multiple accounts (each with unique tax considerations) and income sources (some guaranteed, and some not) to fund your life. 

If you’re within five years of retiring, it’s also worth reviewing the three critical steps to prepare for retirement to make sure you’re laying the right groundwork—financially, emotionally, and logistically.

In this article, we’ll explore five smart strategies to maximize your retirement income and help you reduce uncertainty as you head into your golden years.

Strategy #1: Squeeze All The Juice Out Of Social Security

When it comes to retirement income, Social Security is one of the most important decisions you’ll make. And like most things in financial planning, there’s no one-size-fits-all answer—the right filing strategy depends on your overall financial picture, your health, and your goals.

Start by understanding your Full Retirement Age (FRA)—the age at which you’re entitled to your full benefit. For most people retiring today, FRA falls between 66 and 67, depending on your birth year. If you file early (as soon as age 62), your benefit will be permanently reduced—up to 30% lower if you start right at 62. If you delay filing past FRA, your benefit increases by about 8% for each year you wait, maxing out at age 70. Over time, the difference between claiming early and waiting can add up to hundreds of thousands of dollars, especially if you live a long life.

Timing is even more critical if you’re married.

Spousal benefits allow a lower-earning spouse to receive up to 50% of the higher earner’s benefit. To claim spousal benefits, the higher-earning spouse must file first, and filing before FRA reduces the spousal benefit as well. In addition, when one spouse passes away, the surviving spouse keeps the higher of the two benefits. That means if the higher earner delays filing, it can increase the surviving spouse’s income for life—a critical consideration for couples where one partner is expected to outlive the other.

It’s also helpful to understand your breakeven age—the point at which the total value of delaying benefits surpasses what you would have received by claiming early. For many retirees, the breakeven point falls between age 77 and 83, depending on your benefit amount and filing strategy. If you’re healthy and expect to live well into your 80s or beyond, delaying could be the better move. But if you have health concerns or need income sooner, filing earlier may be the more practical choice.

Ultimately, Social Security is just one piece of your retirement paycheck—but it’s a foundational one. It offers inflation-adjusted, guaranteed income for life, and in many cases, it can act as a buffer that helps protect you during market downturns. The key is to evaluate the tradeoffs, understand how the rules apply to your situation, and make a decision that fits into the broader context of your financial plan. If you’re not sure which path makes the most sense, working with a financial advisor can help you “squeeze all the juice” out of this critical benefit.

Strategy #2. Implement a Tax-Efficient Withdrawal Strategy

One of the most overlooked ways to maximize your retirement income is by carefully managing where your withdrawals come from each year. Most retirees have a mix of account types—traditional IRAs and 401(k)s (tax-deferred), Roth IRAs (tax-free), and brokerage accounts (taxable). Each of these is taxed differently, and the order in which you draw from them can have a big impact on your lifetime tax bill. For instance, early in retirement, you might lean more on taxable accounts and strategically convert IRA dollars to Roth while your income is relatively low.

Later on, Roth accounts can also provide tax-free income in years when your taxable income is already high, helping you stay below key income threshholds.

For example, imagine a retiree who needs to withdraw an extra $15,000 to cover a large one-time expense. If they take the money from their IRA, it increases their taxable income—not only pushing more of their Social Security into the taxable range but also reducing or eliminating subsidies they’re receiving through the Affordable Care Act (ACA). In some cases, that $15,000 withdrawal could result in thousands of dollars in additional taxes and lost benefits. But if that same amount is withdrawn from a taxable brokerage account or Roth IRA, where only a portion is subject to capital gains tax or completely tax-free, the impact might be far less severe. Coordinating withdrawals with your broader tax and healthcare situation can make a significant difference in how long your portfolio lasts.

It’s a common belief that retirees should draw from taxable accounts first, then tax-deferred, and finally tax-free. But as the example below from Fidelity shows, a more balanced approach—pulling proportionally from each type—can lead to dramatically lower taxes over time.

How Withdrawal Order Affects Your Lifetime Tax Bill

Comparison of traditional vs. proportional retirement withdrawal strategies showing a 39% estimated tax reduction when withdrawing proportionally from taxable, tax-deferred, and tax-exempt accounts.
Source: Fidelity Investments

It’s also important to plan around Required Minimum Distributions (RMDs), which begin at age 73 for most retirees (and 75 for those born in 1960 or later). If your traditional retirement accounts are large, those RMDs can create an income spike that pushes you into a higher bracket. Planning ahead by “filling up” lower brackets with partial Roth conversions in your 60s—or withdrawing pre-RMD strategically—can help smooth your tax picture over time. A withdrawal plan isn’t static; it needs to evolve with tax laws and your spending needs.

Strategy #3. Review Your Tax Situation Each Year

Taxes don’t disappear in retirement—they just change form.

Each year, retirees make decisions that can either add up to thousands in unnecessary taxes or lead to years of meaningful tax savings. A yearly review can help you evaluate whether it makes sense to realize capital gains in a low-income year, offset gains with tax-loss harvesting, or accelerate deductions through charitable giving. Retirement often opens up new opportunities for tax savings, especially if you’re no longer earning wages. You may now qualify for deductions like high medical expenses or be able to take advantage of tax-efficient giving strategies such as Qualified Charitable Distributions (QCDs) once you reach age 70½.

One powerful strategy to evaluate each year is Roth conversions. These can be especially impactful in the early years of retirement—after you’ve stopped working but before RMDs and Social Security kick in. By intentionally converting portions of a traditional IRA to a Roth while your taxable income is low, you can pay tax at a lower rate now and reduce the size of future RMDs. Doing this over multiple years can create a more balanced tax picture and lower your lifetime tax bill.

The key is that these decisions require foresight—once the year ends, many tax planning opportunities disappear.

Strategy #4. Stay On Top Of New Changes

Retirement planning doesn’t end when you stop working—it evolves constantly.

Tax laws, Social Security rules, RMD ages, and Medicare premiums are all subject to change, and even small tweaks can have a ripple effect on your income. For example, recent legislation (like the SECURE Act and its sequel) has already changed RMD ages and beneficiary rules for inherited IRAs. COLA adjustments to Social Security can bump up income, which in turn might affect your tax bracket or Medicare premiums.

Staying informed helps you make timely decisions and avoid unintended tax consequences.

Medicare premiums, in particular, are often misunderstood. They’re income-based, so if your Modified Adjusted Gross Income (MAGI) crosses certain thresholds—even by a dollar—you could end up paying hundreds more per month in IRMAA surcharges. That’s where smart tax planning and withdrawal coordination comes in. In some years, it will be essential to know where you are drawing income from and how it will affect your tax picture.

Keeping up with these rule changes doesn’t mean you have to become an expert—but it does mean revisiting your plan each year and adapting as needed.

Strategy #5. Review and Adjust Your Plan Along The Way

Your financial plan is a living document, not a one-and-done checklist.

Retirement is full of curveballs—markets shift, health events arise, family needs change, and your personal goals may evolve too. That’s why it’s so important to revisit your plan annually to make sure it still fits your life. Even small changes, like a new travel goal or deciding to downsize your home, can impact your income needs, investment allocation, and withdrawal strategy. And on the flip side, major unexpected events—like supporting an adult child or dealing with long-term care—can require deeper recalibration.

Annual financial check-ups are a great time to review your current cash flow, make sure your spending plan still aligns with your values, assess your emergency reserves, and rebalance your portfolio if needed. It’s also a good time to run “what if” scenarios—What if the market dips next year? What if you live to age 100? What if you want to give more during life? These reviews don’t just provide peace of mind—they help you stay proactive instead of reactive. Flexibility is one of the most valuable assets in retirement. The more willing you are to course-correct along the way, the more resilient—and fulfilling—your retirement will be.

Retirement isn’t just about income strategies—it’s about enjoying the life you’ve worked hard to build. For ideas on how to live your golden years with purpose and intention, check out our post on How to Make the Most of Your Golden Years.

In the end, retirement can be an exciting and rewarding phase of life, but it requires careful planning and ongoing adjustments to maximize your income and reduce uncertainty. By implementing these five strategies—maximizing Social Security, drawing income tax-efficiently, reviewing your taxes annually, staying informed about key changes, and staying flexible—you can reduce uncertainty and build a more confident retirement.

Albion Financial Group is an SEC registered investment advisor. The information provided is intended solely for educational purposes and should not be construed as an offer or solicitation for the purchase or sale of any particular securities product, service, or investment strategy. Past performance is not indicative of future performance. Additional information about Albion Financial Group is also available on the SEC’s website at www.adviserinfo.sec.gov under CRD number 105957. Albion Financial Group only transacts business in states where it is properly registered, notice filed or excluded or exempted from registration or notice filing requirements.

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How to Make the Most of Your Golden Years

Understanding and Navigating the 4 Phases of Retirement from Dr. Riley Moynes

Executive Summary:

  • Retirement involves significant financial and emotional transitions, impacting routines, identity, and purpose.
  • Dr. Riley Moynes’ framework of four phases helps retirees navigate these changes: the vacation phase, the loss and lost phase, the trial and error phase, and the reinvent and rewire phase.
  • Addressing emotional challenges is crucial to avoid depression and find fulfillment in retirement.
  • Engaging in meaningful activities and serving others can lead to a rewarding and purpose-driven retirement.
  • Lastly, understanding these phases and staying proactive ensures retirees can make the most of their golden years.

Retirement is one of the biggest financial transitions of your life, so many prepare for years or even decades in advance. 

From maximizing workplace retirement plans to optimizing Social Security benefits timing, retirees-to-be invest significant time understanding the financial nuances and tradeoffs needed for a secure and lasting retirement.

But, while many prepare financially, few consider the non-financial side of retirement, specifically, the emotional and psychological transition they will experience in retirement. 

And that can be hard, because the reality is that leaving behind your career, whether you were financially ready or not, can create significant challenges, ultimately leading to higher rates of divorce and depression among retirees.

Fortunately, just like you can prepare for the financial aspects of retirement, there are things you can do to smooth out the emotional and psychological ride into retirement, helping you to “squeeze all the juice out of retirement.” 

In his book, “The Four Phases of Retirement: What to Expect When You’re Retiring” and viral Ted Talk, Dr. Riley Moynes presents a framework to help retirees understand and navigate this significant life event through the 4 Phases of Retirement, which we will explore below.

The 4 Phases of Retirement from Dr. Riley Moynes

Phase 1: The Vacation Phase

The first phase of retirement is the vacation phase – a time when you enjoy your newfound freedom.

Just like being on vacation, you can wake up whenever you want and spend your time however you want – pure bliss, right? Well, just like being on vacation, there often comes a point where you’re ready to go back home, settle into your routines, and “sleep in your own bed again.”

In other words, the new, fun, and exciting feeling of being able to do anything at any time wears off, and you’re left to wonder: is this all there is? 

According to Dr. Riley Moynes, the vacation phase of retirement typically lasts a year before it starts to lose its luster. He says that once you find yourself questioning if this is all there is, you have officially moved on to phase 2. 

Phase 2: Loss and Lost

As the name implies, phase 2 is not a fun place to be, and in his Ted Talk, Dr. Moynes describes it for many as “feeling like getting hit by a bus.”

In this phase, retirees can experience 5 major losses:

The 5 Major Losses in Retirement

  1. Loss of Routine: While work provides structure and routine, the newfound freedom of retirement can be unsettling for many.
  1. Loss of Identity: Many people intertwine their identity with their work, often defining themselves by their job (e.g., “I am a doctor” or “I am an accountant”).
  1. Loss of Relationships: Strong career relationships built over decades can suffer as you no longer interact with colleagues daily.
  1. Loss of Purpose: Many derive their sense of purpose from their work, especially those who feel they are doing their life’s work.
  1. Loss of Power: Retirees often lose the power and influence they once had as key decision-makers in their careers.

Ultimately, these major losses can lead to what Dr. Moynes refers to as the 3 D’s: depression, divorce, and cognitive decline. This period can be incredibly challenging as retirees struggle to find a new sense of purpose and direction without the familiar structure of their careers. Many may feel isolated and uncertain about how to move forward, which can exacerbate these feelings of loss.

Fortunately, by the time retirees decide they can’t go on like this, they have officially entered phase 3: trial and error.

Phase 3: Trial & Error

Phase 3 is all about throwing things at the wall to see what sticks.

It’s a time when retirees ask themselves a couple of powerful questions: 

  1. How can I make my life meaningful again?
  2. How can I contribute?

Dr. Moyne’s advice is simple: do more of the things you love and the things you’re good at. 

And he says if you are having trouble figuring out what that is, start with some reflection. Ask yourself: a) what are some of your greatest accomplishments and b) what do you love doing? 

Where those two things overlap is where you should focus your time. 

Remember, this phase is all about experimenting and finding what brings you joy and fulfillment. Interested in volunteering at your local community garden or library? Go ahead and give it a try. 

And if you’re struggling to come up with ideas, here are ten activities to consider during retirement:

10 Ideas to Find Purpose in Retirement

  1. Volunteering: Engage in volunteer work at local non-profits, schools, hospitals, or community gardens. Volunteering allows you to give back to the community, meet new people, and find a sense of fulfillment.
  1. Mentorship: Offer your expertise and experience to mentor younger professionals in your previous field or other areas of interest. This can be done through formal programs or informal networks.
  1. Lifelong Learning: Enroll in classes at local community colleges or online platforms. You can study subjects that interest you, ranging from history and literature to science and technology.
  1. Hobbies and Crafts: Dive deeper into hobbies you’ve always enjoyed or pick up new ones. Whether it’s painting, woodworking, gardening, or cooking, engaging in creative activities can be very fulfilling.
  1. Fitness and Wellness: Focus on maintaining your physical health through activities like yoga, swimming, hiking, or joining a fitness group. This can also include mental wellness practices like meditation or mindfulness.
  1. Travel and Exploration: If you enjoy traveling, consider planning trips to places you’ve always wanted to visit. Travel can broaden your horizons and provide new experiences and memories.
  1. Writing and Blogging: Share your life experiences, knowledge, or interests through writing. Start a blog, write a memoir, or even work on a novel. This can be a great outlet for self-expression.
  1. Part-Time Work: Find part-time work or freelance opportunities in areas you’re passionate about. This can help maintain a sense of structure and purpose while allowing you to use your skills.
  1. Community Involvement: Get involved in local community groups or organizations. This can include joining clubs, attending town meetings, or participating in community events.
  1. Family and Friends: Spend quality time with family and friends. Strengthen your relationships by organizing regular get-togethers, outings, or family vacations. Being an active part of your loved ones’ lives can bring immense joy and fulfillment.

Phase 3 is all about experimenting with different activities until you find what brings you joy. Remember, this process is unique for everyone—there is no right or wrong—and it can continue to evolve throughout retirement

Last but not least, on to Phase 4: Reinvent and Rewire.

Phase 4: Reinvent & Rewire

In phase 4, retirees find answers to the most important question of them all: what’s the point?

But, in Dr. Moynes’ experience, not everyone makes it to phase 4, with some retirees bouncing back and forth between phases 2 and 3. But, for those that do, he finds that it almost always involves service to others, in some capacity. 

This could involve giving back to your community through volunteer work or mentorship. In his TED Talk, Dr. Moynes mentions a retiree who found joy in delivering “piping hot pizzas to hungry humans” part-time, not for the money, but for the satisfaction of serving others.”

For Dr. Moynes, success in phase 4 came through a friendship he formed that evolved into community classes teaching other friends how to use their iPhones and iPads. He joked that it all started because he and his fellow retirees were all given various Apple products for Christmas from their kids, but half of them could barely figure out how to turn them on, let alone use them. So, he and a friend taught a class on how to use their devices that snowballed into hundreds of classes on a variety of subjects over the years: from how to repair bikes, to learning different languages. 

The best part of all? Dr. Moynes has found that through Phase 4, retirees can recover many of the losses from Phase 2: routine, identity, relationships, purpose, and power. This phase not only helps retirees regain a sense of stability but can also bring renewed meaning and satisfaction to their lives.

So, knowing what you know now, where do you go from here? 

Dr. Moynes’ advice is simple:

Here Are 4 Steps You Can Take to “Squeeze the Most Juice” out of Retirement

  1. Enjoy the vacation in phase 1.
  2. Be prepared for the losses in phase 2.
  3. Try as many different things as possible in phase 3.
  4. And lastly, squeeze all the juice out of retirement in phase 4. 

In the end, with 10,000 people hitting retirement age every day and retirement potentially lasting a third of their life: a) you are not alone and b) this is a problem worth solving. 

By understanding and embracing these four phases, you can turn the challenges of retirement into opportunities for growth, fulfillment, and happiness. Whether you are just beginning your retirement journey or are already navigating its complexities, remember that each phase is a step towards a richer, more rewarding life. The key is to stay open, flexible, and proactive in finding what makes your retirement truly golden.

Albion Financial Group is an SEC registered investment advisor. The information provided is intended solely for educational purposes and should not be construed as an offer or solicitation for the purchase or sale of any particular securities product, service, or investment strategy. Past performance is not indicative of future performance. Additional information about Albion Financial Group is also available on the SEC’s website at www.adviserinfo.sec.gov under CRD number 105957. Albion Financial Group only transacts business in states where it is properly registered, notice filed or excluded or exempted from registration or notice filing requirements.

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Crafting a Foundation for Lasting Income in Retirement 

“Consider it as sculpting a financial architecture…”

Embarking on the journey of retirement is akin to laying the foundation for a fresh chapter in your financial life, where the structure of your income becomes pivotal. In this exploration, we’ll delve into the art of income planning beyond retirement—a strategic composition not just to make your money last but to construct a financial foundation for a lifetime. Consider it as sculpting a financial architecture to support your lifestyle and aspirations. 

Understanding the Blueprint of Retirement Income: 

“The initial step is to decipher the blueprint of your income sources.”

In the realm of retirement income planning, the initial step is to decipher the blueprint of your income sources. Begin by evaluating and documenting your existing and potential retirement income streams, including pensions, Social Security benefits, and withdrawals from your investment portfolio. This exercise transforms your blueprint from an idea into a written account, outlining the contours of your retirement foundation. 

Key Considerations: 

  • Pensions and Social Security: Scrutinize the reliability and sustainability of these income sources, weighing factors like lump-sum versus annuity payout for pensions and potential changes in Social Security regulations or benefit age. 
  • Investment Portfolio: Consider how your investments will contribute to your retirement income. Evaluate the risk profile of your current portfolio and its role in shaping your overall financial structure. 

Building a Structure of Sustainable Income: 

“This exercise transforms your blueprint from an idea into a written account, outlining the contours of your retirement foundation.”

Once the blueprint is clear, the subsequent step is to construct a plan for sustainable income. During this phase, you are crafting a framework for your retirement income that not only covers your basic needs but also adapts to the dynamic nature of your financial landscape. 

Strategies to Consider: 

  • Systematic Withdrawals: Establish a plan for systematic withdrawals from your investment portfolio, ensuring a steady income flow. There are various withdrawal strategies worth considering; this one proves relatively easy to implement. 
  • Tax-Efficient Strategies: Explore tax-efficient methods to optimize your income. This may involve considering Roth conversions, strategic charitable giving, or other approaches to minimize tax implications. Remember that reducing your total lifetime tax payments holds more impact for your financial plan than merely reducing your current year tax liability. 

Fine-Tuning for Resilience: 

“During this phase, you are crafting a framework for your retirement income…”

Just as architects prioritize resilience in building design, your retirement income structure needs fine-tuning for resilience. Integrate risk management strategies to guard against unforeseen challenges and disruptions. The focus should be on the goals you’ve defined for your retirement, without succumbing to the uncertainties of the world around you. 

Resilience Strategies: 

  • Emergency Fund: Maintain an emergency fund to cover unexpected expenses and ensure a buffer against financial uncertainties. 
  • Insurance: Review insurance strategies to ensure alignment with your needs, providing a safety net for unexpected healthcare or other significant expenses you prefer not to bear. 

Adapting to Change: 

“Regularly reviewing and adjusting your plan ensures resilience against evolving personal goals and unforeseen events.”

Bestselling author Morgan Housel encapsulates the transformative nature of time with his statement, “World War II began on horseback in 1939 and ended with nuclear fission in 1945.” In the realm of retirement, where uncertainties abound, one undeniable certainty is change. Your retirement structure should be dynamic, embodying a key principle of financial planning—adaptability. Regularly reviewing and adjusting your plan ensures resilience against evolving personal goals and unforeseen events. 

Adaptability Strategies: 

  • Regular Reviews: Schedule periodic reviews to assess the effectiveness of your income plan and make adjustments as needed. 
  • Flexibility: Build flexibility into your plan to accommodate changes in lifestyle, healthcare needs, or financial goals. 

The Completed Project: 

“Be sure to carefully reflect on the structure you have built, ensuring proper alignment and cohesion with your aspirations and financial goals.”

As you conclude the process of crafting your foundation for lasting income in retirement, be sure to carefully reflect on the structure you have built, ensuring proper alignment and cohesion with your aspirations and financial goals. In this endeavor, you’re not only securing your own financial future but also building a legacy to endure for future generations. 

Just as a completed architectural project stands as a testament to the vision and skill of its creators, your retirement income structure becomes a tangible representation of your financial success. It’s a timeless blueprint, offering enduring stability to enrich your retirement journey and providing a solid foundation for the chapters that follow. As you navigate the complexities of retirement income planning, you’re not just securing your own well-being, you’re shaping a legacy that will resonate for years to come, ensuring that your financial story stands strong against the test of time. 

“You’re shaping a legacy that will resonate for years to come, ensuring that your financial story stands strong against the test of time.”

It is strongly advised to seek counsel from a qualified financial adviser, tax professional, or attorney before implementing any strategy or acting upon any recommendation outlined herein. Albion Financial Group disclaims any responsibility for the consequences of individuals’ decisions based on the information presented and encourages thorough consultation with a financial professional to ensure the appropriateness of any financial decisions made in consideration of personal circumstances and financial objectives.