Fiduciary Financial Advisor in Venice, FL

You have been retired long enough to know the plan worked.

You have lived on Social Security, retirement accounts and the portfolio for years, and the balances are still substantial. In some years, they may have ended higher than they started.

So the question is no longer whether you have enough.

It is how much you can comfortably use. Which accounts should provide it. How much should go to family or charity now. And if a meaningful amount is likely to be left over, what you want that money to accomplish.

The portfolio has done its job of getting you here. Now it needs a clearer job for what comes next.

When the Required Distribution Is More Than You Spend

Once required minimum distributions begin, the IRS decides the smallest amount that must leave your IRA each year. The starting age is 73 if you were born from 1951 through 1959 and 75 if you were born in 1960 or later. The required percentage increases with age.

If Social Security and the distribution already cover what you spend, the extra is taxed as income anyway, then usually reinvested in a taxable account. Year by year, more of your income stops being your choice. A higher income can also raise your Medicare premiums, which are set from your tax return two years earlier.

There are still decisions left. If you give to charity, a qualified charitable distribution sends the gift straight from the IRA, counts toward the required amount and stays out of your taxable income. In lower-income years, converting part of the IRA to a Roth can shrink future distributions, at the cost of tax today. Sometimes the answer is simply to spend more, and enjoy it.

The order and the amounts are worked out several years at a time. Our guide to retirement withdrawal strategy covers how that sequence is built.

What Is the Rest of the Money For?

If the savings will likely outlast you, not every dollar has to be managed for your spending.

That changes the decisions.

An IRA passed to an adult child usually has to be emptied within ten years, and every withdrawal is taxed at the child’s rate, often during their highest-earning years. A Roth account passes without that income tax. Stock in a taxable account generally receives a new cost basis at death, so a gain you would owe tax on today can disappear for your heirs.

So the account you draw from in retirement is also an estate decision. Spending from the IRA and holding the appreciated stock may leave more to the family. Spending from the taxable account may cost less tax now. The right mix depends on your tax bracket, your heirs’ brackets and what you want each of them to have.

Our guide to the inherited IRA explains what your children would face.

Both sides get numbers, for you and for them, before any account is chosen to spend first.

Managing a Portfolio That Has More Than One Job

The plan becomes a written investment policy statement. It records the income the portfolio has to produce each year, the risk the plan can tolerate and the tax treatment of each account.

Money you expect to leave to family or charity is part of that statement too, because who ultimately receives the money can change how it should be invested.

Each account is managed to that statement, aiming for the most you keep after tax at the level of risk the plan sets. We decide which investments belong in the IRA, Roth and taxable account.

The starting point is what you own today. A holding with a large gain that fits the plan may be worth more to your heirs held than sold.

Our investment management carries out the plan, and our approach to retirement planning shows how the plan itself is built.

Working with Holland Capital

Holland Capital Management is an independent registered investment adviser and a fiduciary. M. Chad Holland, CFA, CFP® works directly with clients and is responsible for the planning and advice.

We begin with what you have, what you spend, what the required distributions look like over the next several years and what you want the remaining money to accomplish. If you work with a CPA or an estate attorney, we coordinate with them.

The first conversation is free. If there is work worth doing after that, we will define the scope and cost before you decide whether to move forward.

Our offices are in Charlotte, North Carolina and Winter Park, Florida. We work with clients in Venice primarily by video or phone. When an in-person meeting makes sense, we meet by appointment at the Regus center at 6901 Professional Parkway East in Lakewood Ranch, about 30 to 35 minutes north.

For clients whose investments we manage, accounts are held directly at Charles Schwab in the client’s own name. Holland Capital manages the investments but does not take custody of client assets. If a client ever needs in-person assistance from Schwab, the closest branch is in Sarasota at 100 University Town Center Drive.

We work with clients throughout Florida. You can see the other Florida communities we serve here.

Our what we do page explains how a planning engagement works.

Frequently Asked Questions

Photo: Ebyabe / Wikimedia Commons / CC BY-SA 3.0, cropped.