You think accumulating wealth was hard? Try this.

By Doug Dahmer, Emeritus Retirement Income Specialists

Special to the Financial Independence Hub


How you deploy your accumulated assets to fund the second half of your life is much harder than how you built them up in your accumulation years.

Read this again if you need to, but be sure you get this point.


First build an asset pool under the spell of “Dollar Cost Averaging over the long-term” — the favorite aphorism of the investment management salesperson. For the 30-odd years of your prime saving and accumulation years this mantra encourages you to keep giving money to them, disguises bad performance and promises you future success. Given enough time, however, let’s hope you have more than when you started.

That’s the easy part.

The hard part: making it last a lifetime

Now, try to make this asset pool last a lifetime.

Make it survive the inevitable market corrections of 10 to 50 per cent. Make it survive the tax traps many people blunder into. Make it survive the unforeseen life events that come out of nowhere and dismantle your life’s savings.

That’s the hard part.

There are millions of people across North America about to embark on one of the most challenging tasks of their lives and one that can have material impact on the quality of their lives. Many are about to do this without the proper help.

Most people will see information that says: “You have $X in assets. Each year you can take Y% and you will be fine.” Well, it just doesn’t work that way. The most important financial aspect of your retirement years is the variability of spending. It is the variability that allows you to build sustainable income and protect assets.

Taxes the largest recurring expense

Most will fail to recognize that taxes will be their single largest recurring expense. Further, if they do not prepare, plan and execute a tax strategy tailored to their circumstances, they will pay significantly more than necessary. And believe me, the CRA is not a kind and understanding creditor.

Most will fall prey to continuing their traditional investment strategies. If they do not adopt a pension-style, risk-management-focused investment approach linked to their life plan and spending requirements, they put at risk everything they have worked so hard to accomplish.

Most boomers can’t rely on pension managers

Baby boomers are just now waking up to the reality that they will be the first generation of retirees who no longer rely upon the disciplined approach of highly trained and talented pension plan managers. Upon retirement they will be handed a lump sum that they will have to appropriately apportion out over their remaining life. They now bear all of the risk and all of the responsibility. (YIKES!!)

Fortunately, a new breed of advisor is entering the industry. They call themselves Retirement Income Specialists. These advisors specialize in linking an individual’s personalized life plan with their investment strategy. The process they follow uncovers strategies to minimize taxation, identifies opportunities to optimize recurring income streams, and puts an investment program in place that mitigates the risk of market down turns. The process actually creates wealth by taking advantage of the forward knowledge of how much money is needed and when it will be deployed.

As more and more pre-retirees and retiring baby boomers become aware of the new daunting challenge that awaits them, the demand for the specialized work these new advisors perform will rapidly accelerate.

Can your current advisor do all these things?

Do you think your investment advisor is qualified to guide you in the process of converting your accumulated retirement nest egg into a reliable, sustainable income stream?

Do they know how to use forward knowledge of how much you need and when you will need it, to uncover opportunities to minimize taxation and optimize recurring income streams?

Do they truly understand how investment strategies need to change as the flow of funds reverses from saving to spending?

I hope so, but I sincerely doubt it.

Their training, their tools, their products are geared solely toward serving the needs of the accumulator, not the individual who needs an income stream that must last their lifetime.

Hopefully, their advice has helped you to succeed during your saving years. However if the spending years are on your horizon, Now it’s time for a different kind of advice.

Doug Dahmer

Doug Dahmer, CFP, is founder and CEO of Emeritus Retirement Income Specialists. With offices in Toronto and Burlington, Emeritus’ C3 process is one of the industry’s most comprehensive retirement planning processes.



One thought on “You think accumulating wealth was hard? Try this.

  1. Good advisors recognize the change in client needs and it is at this point that the real hard work starts. If you ask the average person what they plan to do in retirement the usual answer is
    “spend more time with the grand children” or “play more golf”. It is rare to have a client come in and say here is my lifestyle plan and this is how much money I need and when I need it. The hardest part is developing a personalized lifeplan and both the client and advisor need to be involved in creating it.

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