Retirement is one of the biggest transitions in life, and planning for it requires careful consideration. Josiah Grauso, Vice President of ASC Financial Group, has nearly two decades of experience helping individuals and families navigate the complexities of retirement planning. He specializes in Social Security optimization, income diversification, and risk management, ensuring that retirees can enjoy financial security in their later years.
In this interview, Josiah shares essential steps for those who are five years or less from retirement. He discusses what people often overlook, how to create a sustainable income plan, and strategies to avoid common financial pitfalls.
What is the first thing someone should do when they are within five years of retirement?
The first step is to evaluate your financial picture. This means getting a clear understanding of what you own, what you owe, and what income you will have in retirement.
Start by listing out your retirement accounts, pensions, Social Security benefits, and other income sources. Then, compare these to your estimated monthly expenses. Many people assume they will spend less in retirement, but that’s not always the case—especially in the early years when they’re traveling more or taking on new hobbies.
“I always tell clients that retirement isn’t just about how much you’ve saved—it’s about how much you’ll need and whether your income sources can support that lifestyle.”
How should someone plan their retirement income to avoid running out of money?
The key is to diversify your income streams. You don’t want to rely solely on Social Security or one investment account.
Here are a few important sources of retirement income to consider:
- Social Security benefits – Decide when to claim to maximize payouts.
- 401(k) or IRA withdrawals – Plan out a sustainable withdrawal rate.
- Pension payments – If applicable, understand payout options.
- Rental income or part-time work – Consider additional sources of steady income.
- Annuities – Can provide guaranteed lifetime payments for extra security.
It’s also critical to have a withdrawal strategy. A common approach is the 4% rule, where you withdraw 4% of your savings each year, adjusting for inflation. But this doesn’t work for everyone, and market conditions can affect how much you should withdraw.
“The biggest mistake I see is people withdrawing too much too soon. You have to pace yourself so your savings last 20 or even 30 years.”
When should people claim Social Security, and what should they consider?
Timing is everything when it comes to Social Security. If you claim as early as 62, your benefits are permanently reduced. If you wait until full retirement age (66-67), you get your full benefit. And if you delay until age 70, your monthly benefit increases by 8% per year.
I tell clients to consider these factors before making a decision:
- Do you need the money immediately? If not, waiting can provide a bigger payout.
- What is your life expectancy? If you’re in good health and have longevity in your family, delaying benefits might be a better choice.
- Will you keep working? If you claim Social Security before full retirement age while still working, your benefits could be reduced based on earnings.
“One of the most important decisions you’ll make in retirement is when to claim Social Security. It’s not a one-size-fits-all answer, and it should be part of a bigger income strategy.”
What about healthcare? What should retirees be thinking about?
Healthcare is a major expense in retirement that many people underestimate.
Medicare starts at age 65, but it doesn’t cover everything. You’ll likely need a supplemental policy or a Medicare Advantage plan. Prescription drugs, dental, and vision care are also out-of-pocket costs that add up.
If you’re retiring before 65, you need a plan for bridging the healthcare gap—whether that’s COBRA, a spouse’s plan, or private insurance. Long-term care planning is another factor. Assisted living or in-home care can drain savings quickly, so having long-term care insurance or a dedicated savings strategy is critical.
“One unexpected medical event can change everything, so healthcare planning is a must.”
How should retirees prepare for taxes in retirement?
Taxes don’t go away in retirement—they just look different. Many people don’t realize that Social Security, pensions, and withdrawals from traditional retirement accounts are taxable.
Here are a few key things to consider:
- Tax brackets can change in retirement – Plan withdrawals wisely to avoid bumping into a higher tax bracket.
- Roth IRA conversions – These can provide tax-free income in retirement if done strategically.
- Required Minimum Distributions (RMDs) – At age 73, you must start withdrawing from certain accounts.
Having a tax-efficient withdrawal strategy is essential to keeping more of your money.
“A tax mistake in retirement can cost thousands over time, so planning ahead is key.”
What’s one financial mistake retirees often make?
Not having an emergency fund. Many assume their retirement savings will cover everything, but unexpected costs—like home repairs, medical bills, or helping a family member—can drain savings quickly.
Having six months to a year’s worth of expenses in an easily accessible account provides peace of mind and prevents unnecessary withdrawals from long-term investments.
“Retirement planning isn’t just about investing—it’s about preparing for the unexpected.”
What’s one final piece of advice for those about to retire?
Test-drive your retirement budget.
Live off your expected retirement income for six months to a year before you actually retire. This will help you see if your plan works in real life and adjust before it’s too late.
“Retirement is a huge transition. Preparing ahead of time makes it smoother and less stressful.”
Retirement is an exciting time, but the key to a successful retirement is preparation. By evaluating your financial picture, creating a strong income strategy, and thinking through taxes, healthcare, and unexpected expenses, you can step into retirement with confidence.
For those looking for personalized guidance, Josiah recommends working with a financial professional to create a tailored retirement plan that fits your unique goals and needs.
Disclaimer: Investment advisory services offered through Brookstone Capital Management, LLC (BCM), a registered investment advisor. BCM and ASC Financial Group are independent of each other. Insurance products and services are not offered through BCM but are offered and sold through individually licensed and appointed agents.
This content is provided for informational purposes only and is not a solicitation or recommendation of any investment strategy. Investments and/or investment strategies involve risk including the possible loss of principal. There is no assurance that any investment strategy will achieve its objectives.
Any comments regarding safe and secure investments, and guaranteed income streams refer only to fixed insurance products. They do not refer, in any way to securities or investment advisory products. Fixed Insurance and Annuity product guarantees are subject to the claims‐paying ability of the issuing company and are not offered by Brookstone Capital Management.
ASC Financial Group is not endorsed by or affiliated with the Social Security Administration or any government agency.
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