The number alone cannot answer the question. The plan must show what the money is responsible for—and how the couple could adjust as life changes.

Illustrative example: David and Susan are a hypothetical couple. Their circumstances combine common retirement-planning issues we have encountered. Their names, ages and financial details are fictional and do not represent any particular client or result. The example is educational and is not a recommendation, projection or guarantee.

David expected to feel relieved when retirement finally came within reach.

Instead, he felt more uncertain.

He and Susan had spent decades saving and investing. Their children were independent. They owned a home in Naples, had accumulated $5 million of investable assets and were approaching the retirement they had imagined for years.

On paper, they appeared ready.

But as David prepared to leave work, the questions became more real.

Where would their monthly income come from when the paycheck stopped? Should they begin Social Security or let it grow? Which accounts should they use first? Could they maintain two homes, travel, help their family and still feel secure? What if the market declined during their first year of retirement? And what would happen to Susan if David were no longer there to oversee the finances?

Their real question was not simply:

Do we have enough?

It was:

Can we see how this is supposed to work—and can the plan adjust when life changes?

The retirement they wanted

David was 63 and Susan was 62. David hoped to retire at the end of the year.

They planned to make Naples their primary home while keeping their northern residence for approximately three more years. They wanted time for travel, dinners with friends, family visits and the activities that had been postponed while David was working. They also wanted the freedom to help their children and grandchildren when it mattered.

They were not trying to spend as little as possible.

They wanted to enjoy the healthiest and most active years of retirement while remaining thoughtful about the future.

Their initial estimate was approximately $220,000 of annual lifestyle spending, before income taxes and larger irregular expenses. That included the ordinary costs of two homes, insurance, healthcare, travel and the life they expected to lead in Naples.

Their $5 million of investable assets consisted of:

• $3 million in traditional IRAs and 401(k)s
• $1.2 million in a taxable investment account
• $300,000 in Roth accounts
• $300,000 in individual stocks held separately
• $200,000 in checking

Their homes were not included in the $5 million.

The balance sheet looked strong. The income plan was still missing.

A portfolio number is not a retirement paycheck

David had read about withdrawal-rate rules. He knew that 4% of $5 million was $200,000.

That was useful as a reference point, but it did not answer their question.

Their planned spending was not the same as the amount the portfolio would need to provide. Income taxes had to be considered. Healthcare costs would change when each spouse became eligible for Medicare. The northern home created additional expenses for several years. Social Security could reduce the amount needed from investments later, but only after benefits began.

They also did not have $5 million sitting in one interchangeable account.

Withdrawals from a traditional IRA generally affect taxable income differently from sales in a taxable account or qualified withdrawals from a Roth IRA. Selling appreciated investments may create capital gains. Drawing from checking is simple, but checking eventually must be replenished.

The amount mattered. The location of the money mattered. The timing mattered.

Planning began to connect those pieces.

First, the plan gave their spending a purpose

Instead of reducing retirement to one annual number, David and Susan separated their expected spending into three categories.

Essential spending included housing, food, healthcare, insurance and taxes.

Meaningful spending included travel, time with family, charitable giving, dining and the activities that made retirement feel like the life they had worked to create.

Flexible spending included projects, purchases and trips that could be postponed temporarily if markets or circumstances changed.

This distinction mattered.

If every dollar was treated as fixed, a difficult market could make the plan feel fragile. When they identified which spending was essential and which was flexible, they could see that they had choices.

They did not need to abandon the retirement they wanted at the first sign of uncertainty. They needed to know which adjustments were available and when they might be appropriate.

Then they compared Social Security choices

David initially assumed that both of them should begin Social Security as soon as possible. His reasoning was understandable: if benefits began sooner, less money would need to come from the portfolio.

But that was only one part of the decision.

Social Security benefits generally increase when claiming is delayed beyond full retirement age, up to age 70. Delayed retirement credits earned by the higher-earning spouse may also increase the benefit later used in calculating an eligible surviving spouse's benefit. Social Security Administration, Code of Federal Regulations, 20 CFR § 404.313

The planning analysis compared several paths:

Both spouses claim relatively early, reducing near-term portfolio withdrawals but accepting smaller monthly benefits.

Susan begins first while David delays his higher benefit.

Both delay, requiring more from the portfolio during the early years but creating more guaranteed monthly income later.

One path David and Susan preferred was for Susan to begin at her full retirement age while David delayed his higher benefit until age 70. It was not automatically the correct answer for every couple. In their hypothetical plan, it balanced three goals:

It introduced Social Security income before both benefits had been delayed to age 70.

It increased the later benefit associated with David's earnings record.

It gave additional consideration to the income that might remain for Susan if she survived David.

The plan also accounted for the years before Medicare eligibility. Medicare generally covers eligible people beginning at age 65, so Susan's pre-Medicare coverage and David's transition to Medicare needed to be included rather than treated as a surprise. Medicare.gov

Social Security was no longer a birthday decision. It became one part of their income, tax, healthcare and survivor plan.

The plan showed where their income could come from

The most reassuring part of the process was not a probability score.

It was seeing a forward path.

David and Susan could look across the coming years and understand how their monthly spending might be funded.

The first retirement years

Their checking account would provide the initial monthly deposits into their household account. That allowed retirement to feel familiar: expenses would still be paid from a regular cash source instead of forcing David or Susan to decide which investment to sell every time a bill arrived.

The checking account was not intended to fund retirement indefinitely. It was part of a liquidity system.

Their taxable investment account, investment income and selective sales of individual stocks could be used to replenish cash. Those decisions could be coordinated with market conditions, realized gains and losses, and the household's tax situation.

Because much of their wealth was in traditional retirement accounts, the plan also compared measured IRA withdrawals and partial Roth conversions during the years before Social Security and required distributions added more income. Those decisions would need to be reviewed annually with their tax professional. The goal was not to convert as much as possible. It was to evaluate whether conversions made sense within the rest of their tax, Medicare and estate picture.

The years after Social Security began

As Susan and then David began receiving Social Security, the amount required from investments could decline.

That did not mean the portfolio stopped supporting their life. It meant the sources changed.

Their projected retirement paycheck could eventually combine:

Susan's Social Security benefit

David's later Social Security benefit

Interest and dividends

Tax-aware withdrawals from taxable investments

Distributions from traditional retirement accounts

Roth withdrawals when strategically useful

The plan did not depend on finding one perfect income-producing investment. It coordinated several sources so the portfolio could remain diversified and adaptable.

After the northern home was sold

David and Susan expected to keep their northern home for three years.

The plan included its taxes, insurance, maintenance, utilities and travel costs during that period. It did not assume that the house would sell at the perfect time or for a predetermined price.

When it was eventually sold, the plan would be updated using the actual proceeds, taxes and new spending pattern.

The sale was not treated as a vague future rescue. It was a decision point with a timetable and a review process.

Their investments also needed a new job

Before retirement, David and Susan's portfolio had one primary job: grow.

In retirement, it had several jobs:

Provide dependable liquidity for near-term spending

Participate in long-term growth to help address inflation and longevity

Avoid unnecessary selling during difficult markets when practical

Manage taxable gains, losses and investment income thoughtfully

Remain understandable and manageable for Susan

Support changing income needs over time

This did not require abandoning equities or predicting the next market decline.

It required aligning the portfolio with the spending plan.

Money expected to support nearer-term distributions needed to be viewed differently from money intended for later retirement and legacy goals. The separate individual stocks also needed to be evaluated within the entire portfolio rather than treated as untouchable simply because David had owned them for years.

Investment management and retirement planning could no longer operate as separate activities.

The most valuable plan was not the most optimistic one

David and Susan did not need a projection that assumed everything would go right.

They needed to see what could happen if it did not.

Their analysis considered questions such as:

What if markets declined shortly after David retired?

What if they kept the northern home longer than expected?

What if healthcare or insurance costs rose faster than planned?

What if they wanted to spend more during their first active retirement years?

What if one spouse died earlier than expected?

What if future tax rules or family priorities changed?

The purpose was not to frighten them with every possibility.

It was to identify which risks mattered, which assumptions could be monitored and which adjustments were available.

They could postpone flexible spending for a period. They could revisit the timing of the northern-home sale. Portfolio withdrawals could be adjusted. Roth conversions could be increased, reduced or paused. Investment gains and losses could be managed in light of the household's changing taxable income. Their Social Security choices could be finalized closer to the actual claiming dates using current facts.

The plan became a decision-making framework, not a prediction.

Ongoing planning made the forward path visible

The initial analysis gave David and Susan a clearer picture of retirement.

But the plan was not finished when the first projection was printed.

Each year, they would compare what actually happened with what the plan had assumed:

Did spending match the estimate?

Had travel, family support or housing priorities changed?

What income had arrived?

How had the portfolio performed?

Were the Social Security assumptions still appropriate?

Did a Roth conversion still make sense that year?

Was the northern-home timetable unchanged?

Had tax laws, insurance costs, health or family circumstances changed?

Material changes would prompt an additional review rather than waiting for the next scheduled meeting.

The forward path could then be updated. The investment strategy, cash reserve, distributions, taxable income and future assumptions could be adjusted as appropriate.

That ongoing process gave David and Susan something more useful than certainty.

It gave them visibility.

They could see where income was expected to come from. They knew which decisions were coming next. They understood what they could control and which factors would need to be monitored. Most importantly, they knew the plan had room to change.

Confidence did not mean believing nothing would go wrong

Before planning, David and Susan viewed retirement as one irreversible decision.

If David retired and the market fell, had they made a mistake? If they spent more on travel, were they threatening their future? If they delayed Social Security, were they taking too much from the portfolio?

After planning, they saw a different picture.

Retirement was not one decision. It was a series of connected decisions that could be reviewed as life unfolded.

They had permission to enjoy the early years because that spending had been acknowledged and tested. They could maintain two homes temporarily because the costs and timetable were visible. They could delay David's Social Security because the bridge years had a funding strategy. They could help their family because those gifts could be evaluated within the plan rather than made in isolation.

Their confidence did not come from believing the future would cooperate.

It came from knowing they had a forward path—and a process for adjusting when the future changed.

The lesson from David and Susan

Was $5 million enough for David and Susan to retire in Naples?

The number alone could not answer the question.

What mattered was what their money needed to support, how long it might need to last, where income would come from, how taxes and Social Security would interact, what could adjust and whether the plan would continue working for either spouse.

For this hypothetical couple, planning turned a collection of accounts into a retirement-income system.

It connected the life they wanted with the money intended to support it.

And it replaced a vague fear of running out with a clearer understanding of the road ahead.

How Edwards Asset Management can help

At Edwards Asset Management, our CFP® retirement-planning professionals use advanced planning software to compare multiple assumptions involving spending, Social Security, taxes, Roth conversions, investment returns, longevity and family goals.

Our investment management team can then coordinate the portfolio with the plan—maintaining liquidity, providing distributions and managing gains, losses and investment income in a tax-aware manner when appropriate.

The work does not end with the initial plan. We help families maintain and update the forward path as the things they can control—and the things they cannot—change over time.

For PIM managed-account clients, CFP® retirement planning is incorporated into the managed-account relationship. Advisory fees apply. Edwards Asset Management and Wells Fargo Advisors Financial Network, LLC do not provide tax or legal advice. We coordinate with clients' tax and legal professionals when appropriate.

If you would value a second set of eyes on the assumptions behind your retirement, we invite you to request a complimentary consultation about retirement-income strategies at our Naples office.