A Single Man | Dave’s Challenge | Transcend Retirement NV


AGE: 59

Dave’s Challenge

Dave wants to rebuild his nest egg as soon as possible. His retirement savings were cut in half after his divorce two years ago.


Our Approach

  1. Tax return analysis. Most of Dave’s retirement savings are in his 401k, which are taxable upon withdrawal.

  2. Investment Analysis. Dave's 401k and smaller Roth IRA are invested in mutual funds. He has a taxable brokerage account invested in stocks and bonds.

  3. Social Security analysis. Dave is not sure if he can afford to retire at 67. He had planned on taking social security at 67 years of age.

  4. Insurance review. Dave has a cash value life insurance policy.

  5. Life planning - We discussed ways Dave might extend his working life doing something that he finds more fulfilling than his current job.


The Results

  1. Dave has longevity in his family. Given the current relatively low tax rates, we will consider the possibility of converting a portion of Dave’s taxable retirement savings to a Roth IRA in the future.

  2. In order to lower the cost burden on Dave’s investment performance we will transition away from mutual funds to lower cost exchange traded funds. His taxable account will be managed more tax efficiently, with harvesting of stock losses, attention paid to short term gains, and tax free bonds.

  3. Dave will consider transitioning from his high stress job at age 65 time to a part time position working with the National Park Service. This will likely coincide with Dave moving to a less expensive rural area. Dave will thus be able to defer taking Social Security until age 70.

  4. Dave will continue paying premiums to an insurance policy that offers him the flexibility of a death benefit, access to long term care distributions, and/or tax free distributions of cash value to complement his retirement savings.


*This is a hypothetical case study.