Retirement income planning has become more complex as clients live longer and face more uncertainty around taxes and markets. Researchers estimate a 3.9% starting safe withdrawal rate for a 30-year retirement with a balanced portfolio. That is slightly higher than 3.7% the prior year, while more flexible strategies may support rates around 5.1% or higher.

For RIAs, the challenge is not only choosing a withdrawal rate. Clients need income plans that can adjust to market conditions and still support long-term spending needs. A stronger retirement income strategy should connect withdrawals with taxes, guaranteed income, and portfolio risk.

How Should RIAs Approach Withdrawal Sequencing?

Withdrawal sequencing can have a major impact on how long retirement assets last. The order in which clients draw from taxable accounts, tax-deferred accounts, and Roth assets can affect both annual taxes and long-term portfolio flexibility.

RIAs can help clients model different withdrawal paths before retirement begins. This is especially important as required minimum distributions start at age 73. A thoughtful sequence can reduce unnecessary tax pressure while preserving more flexibility for later retirement years. 

Why Should RIAs Use Tax Buckets in Retirement Income Planning?

Tax-bucket planning helps clients manage retirement withdrawals across different account types. Taxable, tax-deferred, and Roth accounts each affect income differently, so the withdrawal plan should not treat them the same way.

RIAs can use lower-income years to evaluate Roth conversions or adjust taxable withdrawals. In 2026, updated tax rules and charitable deduction changes make this planning more important. A tax-aware income plan can help clients manage brackets and reduce the long-term cost of withdrawals.

How Can RIAs Manage Portfolio Risk in Early Retirement?

The first years of retirement are especially important because market losses can have a larger impact when withdrawals have already started. This is known as sequence-of-returns risk.

RIAs can reduce this risk by matching portfolio structure to spending needs. Some clients may benefit from a cash reserve or a more flexible withdrawal framework. Morningstar’s research also shows that balanced portfolios can support sustainable withdrawals by reducing volatility during the most sensitive years.

What Overlooked Areas Can Support Retirement Income Planning?

Retirement planning can also create an opportunity to recover value that may already exist inside client portfolios. Securities class action recovery is one clear example. In 2025, settlements reached about $8B, yet many eligible proceeds remained unclaimed because the process required manual matching, filing, and payout tracking.

Platforms such as 11th.com now automate the entire recovery workflow and deposit proceeds directly to client accounts. The platform is natively integrated with major custodians and TAMPs, including Fidelity, Schwab, BNY, Pershing, Addepar, Orion, and SS&C Black Diamond, covering 85%+ of the market.

For RIAs, this can add value during retirement planning without adding internal workload, especially for clients who rely on portfolio assets for long-term income.

What Should RIAs Prioritize in 2026?

In 2026, RIAs should build retirement income strategies that are flexible, tax-aware, and connected to each client’s spending needs. Withdrawal planning should not be handled separately from portfolio risk or tax decisions.

FAQ

What is withdrawal sequencing in retirement income planning?

Withdrawal sequencing is the order in which clients draw from different account types. It can affect taxes and how long retirement assets last.

Why are tax buckets important for retirement income?

Tax buckets help RIAs plan withdrawals across different account types and reduce long-term tax pressure.

How can RIAs manage sequence-of-returns risk?

RIAs can manage this risk by aligning portfolio structure with spending needs and using flexible withdrawal strategies.

What overlooked areas can support retirement income planning?

Overlooked areas such as settlement recovery can help RIAs return additional value to client accounts without adding internal workload.

What should RIAs prioritize in retirement income planning in 2026?

RIAs should prioritize flexible, tax-aware income plans connected to each client’s spending needs.