Most people who save $1 million or more for retirement assume that the hardest part is behind them.
It’s not like that.
The strategies that build wealth are not the same as the strategies that preserve it. And early mistakes made in retirement — taxes, timing, and Social Security decisions — are often irreversible.
By the time most retirees noticed the impact, it had already worsened.
According to Allianz Life’s 2025 Annual Retirement Study, 64% of Americans are more worried about running out of money than about death itself. This concern reflects a real gap between what people have saved and whether they have a plan to keep it going.
To make sure your retirement strategy is built on what comes next, take our AdviserMatch quiz today.
Here’s what most financial advisors don’t tell investors with $1 million or more.
4 retirement risks that could quietly reduce your income
Retirement is rarely interrupted in obvious ways. In most cases, damage builds up quietly until it is too late to correct it. Here the risks accumulate:
1. Tax traps inside retirement accounts
Most retirement savings are found in tax-deferred accounts, 401k, and traditional IRAs. Every dollar taken out is taxed as ordinary income.
A retiree who withdraws $80,000 a year from a traditional IRA does not get $80,000. After federal taxes, state taxes, and potential Medicare surcharges, the real number is much lower.
For investors with $1 million or more spread across multiple account types, the order in which you withdraw these accounts can represent a significant difference in lifetime after-tax income. Without a deliberate sequencing strategy, the default is always the more expensive option.
This is one of the most common and least discussed ways retirees quietly overpay. Take our AdviserMatch test to see if your withdrawal strategy is costing you.
2. The five years that could permanently change your retirement
According to research by Fidelity Investments, negative returns are more harmful early in retirement than later, because retirees lose more years of potential compound growth. The first five years of retirement represent the highest risk window of permanently depleting the portfolio.
When a market decline occurs early in retirement, you are forced to sell assets at low prices to fund living expenses. These assets cannot be recovered. The damage worsens during each subsequent year.
A portfolio that experiences a large loss in the second year of retirement faces a fundamentally different outcome than one that experiences the same loss in the fifteenth year. Most retirement forecasts don’t show you this distinction.
If the first three years of your retirement look like 2022, or 2008, is your current strategy built to survive?
3. The Social Security mistake most people make
The difference between claiming Social Security at 62 versus waiting until 70 can represent tens of thousands of dollars in lifetime benefits.
But timing is only part of the equation. For investors with $1 million or more in tax-deferred accounts, required minimum distributions can push income into higher tax brackets, impact Medicare premiums, and significantly change the optimal claims strategy.
These variables must be designed together. Most people never do this analysis. Most advisors never offer it. For investors with significant retirement assets, getting this wrong is one of the most expensive and least reversible decisions in the entire retirement planning process.
4. Running out of money is more common than you think
According to CDC data, a 65-year-old American can expect to live on average nearly 20 more years. A 65-year-old woman has about a 40% chance of reaching age 90. A 65-year-old man has about a 30% chance.
A retirement plan designed for 20 years may not be a plan designed for the life you actually live.
Even investors with $1 million or more can face a real longevity risk if their withdrawal rate, investment allocation, and income strategy are not designed for a potential 30-year retirement. Rising health care costs and inflation make the problem worse every year.
The question is not whether you have enough savings. The question is whether your strategy is built on making it last.
Each of these risks has a solution. The challenge is that most consulting relationships are not built to address them.
Why don’t most advisors solve this problem?
Most financial advisors are designed for accumulation, helping you save and invest during your working years. Distribution is a completely different system. It requires tax sequencing, withdrawal strategy, Social Security optimization, health care cost planning, and longevity risk management all working together as one coordinated system.
Many investors are surprised to learn that their current advisor simply does not offer these services. Not because they are incapable, but because most consulting relationships were never designed to achieve these goals.
The industry is built to grow your money. Very few companies have been created to protect and distribute it. For investors with $1 million or more, this distinction is extremely important.
The good news is that advisors who specialize in retirement income planning for investors with $1 million and above exist. Finding the right one may be the most important financial decision a retiree can make.
How to protect your retirement income today
- Take our Free AdviserMatch test To be matched with a fiduciary advisor who specializes in retirement income planning for investors with significant assets.
- Answer some quick questions today
- Get matched with a vetted credit counselor
Citations
https://www.cdc.gov/nchs/products/databriefs/db521.htm
https://www.fidelity.com/viewpoints/retirement/safeguard-retirement-savings
