Retirement is one of life’s biggest transitions. Your paycheck may stop, but your expenses don’t. And your time, priorities, and goals often shift in meaningful ways. If you’ve never created a formal budget before, you’re not alone. Many people haven’t needed one during their working years.

The good news? It’s never too late to put a simple, flexible plan in place that helps you feel confident about your spending and your future.

Here are some practical tips to help you build, and stick to, a retirement budget that works for you.

1. Start with What You Spend Today

Before building a retirement budget, take a look at your current spending. This gives you a realistic baseline.

Focus on:

• Housing (mortgage/rent, taxes, insurance)

• Food and utilities

• Transportation

• Insurance and healthcare

• Discretionary spending (travel, hobbies, dining)

From there, adjust for what will change in retirement as some costs may go down (commuting, work expenses), while others may increase (healthcare, travel, leisure).

2. Separate “Needs” from “Wants”

A helpful way to simplify budgeting is to divide expenses into two categories:

• Needs: Essential expenses you must cover (housing, food, insurance, basic healthcare)

• Wants: Lifestyle choices (travel, entertainment, gifts, dining out)

This approach gives you flexibility. In years when markets are volatile or unexpected expenses arise, you can adjust discretionary spending without disrupting your core lifestyle.

3. Plan for Healthcare… More Than You Expect

Healthcare is often one of the most underestimated retirement expenses.

Be sure to account for:

• Medicare premiums and supplemental coverage

• Out-of-pocket costs (deductibles, prescriptions, dental/vision)

• Potential long-term care needs

Building a cushion here can help avoid surprises later.

4. Build in a “Buffer Zone”

Life rarely follows a perfect plan. Home repairs, helping family, or simply wanting to take an extra trip can all impact your budget.

A good rule of thumb is to include a buffer (5–10%) in your annual spending plan. This creates breathing room and reduces the stress of unexpected costs.

5. Align Your Budget with Your Income Strategy

Your retirement income may come from multiple sources:

• Workplace retirement plans (401(k), 403(b))

• Social Security

• IRAs or taxable accounts

The key is making sure your withdrawal strategy aligns with your spending needs so your money lasts while still supporting the lifestyle you want.

This is where thoughtful planning really matters; balancing reliable income with flexibility for the years ahead.

6. Revisit and Adjust Each Year

Your retirement budget isn’t a one-time exercise. It’s a living plan.

Each year, take a few minutes to review:

• Changes in spending

• Market performance

• Income sources

• Life goals or priorities

Small adjustments over time can make a big difference in keeping your plan on track.

Final Thoughts

Creating a retirement budget isn’t about restricting your lifestyle. It’s about giving yourself clarity and financial confidence. When you know where your money is going and how it supports your goals, it becomes much easier to enjoy retirement without second-guessing every decision.

If you haven’t created a budget yet, that’s okay. Starting now, even with a simple outline, is a powerful step toward making the most of the years ahead.

Scott Higgins | AIF ®, CFP®, CPFA®, NSSA®

Financial Advisor

This material and the opinions voiced are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine waht is appropriate for you, please contact me directly or consult another qualified professional

Securities and Investment Advisory Services Offered Through M Holdings Securities, Inc. A Registered Broker/Dealer and Investment Advisor, Member FINRA/SIPC. Rose Street Advisors is independently owned and operated. #5341120

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For HR leaders, finance professionals and retirement plan committees, sponsoring a 401(k) or 403(b) plan is both a valuable employee benefit and an important fiduciary responsibility. Plan sponsors must ensure that their plan operates in the best interests of participants while maintaining reasonable fees, competitive investments and quality services.

One of the most effective ways to evaluate the health of a retirement plan is through benchmarking. Benchmarking allows plan sponsors to compare their plan’s fees, services, investments, and design features to similar plans in the marketplace. The insights gained can help identify opportunities to improve the plan and demonstrate responsible oversight.

What Is Retirement Plan Benchmarking?

Benchmarking is the process of comparing your retirement plan against similar plans based on factors such as:

• Total plan assets

• Number of participants

• Industry type

• Plan features and services

The goal is to determine whether your plan’s costs and services are reasonable and competitive. Benchmarking also supports fiduciary oversight under the Employee Retirement Income Security Act, which requires plan fiduciaries to act prudently and ensure plan fees are reasonable relative to the services provided.

Why Benchmarking Is Important

Demonstrates Fiduciary Responsibility

Benchmarking provides documentation that plan sponsors are reviewing plan costs and services on a regular basis. This process helps support a prudent decision-making framework.

Evaluates Plan Fees

Retirement plan fees can vary widely depending on plan size and service structure. Benchmarking helps determine whether costs such as recordkeeping, advisory, and investment fees are reasonable compared with similar plans.

Improves Participant Outcomes

Benchmarking often uncovers opportunities to improve the plan, such as:

• Lower-cost investment options

• Additional participant education resources

• Enhanced retirement planning tools

• New plan features like automatic enrollment

Even small improvements can have a meaningful impact on long-term retirement savings.

Key Types of Retirement Plan Benchmarking

Plan sponsors typically review several different aspects of their retirement plan during benchmarking.

Fee Benchmarking

Fee benchmarking evaluates the overall cost of the plan relative to similar plans. Areas reviewed may include:

• Record keeping and administrative fees

• Investment expense ratios

• Advisor compensation

• Total plan cost per participant

This type of benchmarking is commonly conducted every one to three years.

Investment Benchmarking

Investment benchmarking reviews the plan’s investment lineup to ensure funds remain competitive and appropriate for participants. Committees often evaluate:

• Fund performance relative to benchmarks

• Expense ratios

• Risk characteristics

• Availability of lower-cost share classes

Investment monitoring is often performed quarterly or semiannually.

Service Benchmarking

Service benchmarking evaluates the quality and scope of services provided by vendors such as record keepers and advisors.

This may include reviewing:

• Participant education programs

• Retirement readiness tools

• Call center support

• Technology platforms and mobile access

• Plan administration support

Ensuring participants have access to strong resources can improve engagement and retirement readiness.

Plan Design Benchmarking

Plan design benchmarking compares your plan’s structure and features against industry norms such as:

• Employer matching contributions

• Auto-enrollment and auto-escalation features

• Vesting schedules

• Eligibility rules

Understanding how your plan compares to others can help ensure your retirement benefit remains competitive for attracting and retaining employees.

Request for Proposal (RFP)

A Request for Proposal is a comprehensive benchmarking process where plan sponsors invite multiple providers to submit proposals for plan services. This process evaluates pricing, services, technology, and overall value.

An RFP allows plan sponsors to test the marketplace and confirm whether their current provider remains competitive. Many organizations conduct an RFP every three to five years.

Final Thoughts

Benchmarking is an essential part of responsible retirement plan management. By regularly evaluating fees, investments, services, and plan design, plan sponsors can ensure their retirement plan continues to provide strong value for participants.

Regular reviews also help demonstrate fiduciary prudence and identify opportunities to strengthen the plan over time.

If your organization hasn’t reviewed its retirement plan recently, now may be the time. Consider working with your advisor or retirement plan consultant to conduct a benchmarking review of your 401(k) or 403(b) plan to ensure it remains competitive, cost-effective, and positioned to support your employees’ long-term retirement goals.

Scott Higgins | AIF ®, CFP®, CPFA®, NSSA®

Financial Advisor

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For many retirees, Social Security is a foundational source of income—yet most people claim without fully understanding how their timing and strategy can impact lifetime benefits. By learning how different claiming options work, you can make a more informed decision that supports your long-term financial goals.

1. Know Your Full Retirement Age (FRA)

Your FRA is the age at which you qualify for 100% of your Social Security benefit. Claiming before FRA (at age 62 or later) reduces monthly benefits permanently. Waiting until FRA or beyond increases your monthly income and can provide more stability later in retirement.

2. Consider Delaying Benefits for Higher Lifetime Income

If you delay Social Security past your FRA, benefits grow by roughly 8% per year until age 70. This strategy can be especially impactful for individuals with longer life expectancies or families with longevity. Delaying can also strengthen survivor benefits for a spouse.

3. Evaluate Spousal Strategies

Married couples have more flexibility in how they claim. One spouse may claim earlier to provide income while the higher-earning spouse delays their benefit for maximum growth. Understanding how spousal and survivor benefits work can help couples significantly increase total household benefits.

4. Integrate Social Security Into Your Broader Retirement Plan

Choosing when to claim shouldn’t happen in a vacuum. Factors like part-time work, pension income, tax considerations, and required minimum distributions all affect the optimal strategy. Coordinating Social Security with your savings and spending plan can help stretch your retirement dollars further.

5. Avoid Earning Penalties if You Claim Early

If you claim before FRA and continue working, Social Security may temporarily withhold some of your benefits once you exceed annual earnings limits. This isn’t a penalty, you’ll eventually receive credit for those reductions, but understanding the rules can prevent surprises.

6. Review Annually and Adjust if Needed

Life changes such as marriage, divorce, widowhood, health changes can all impact your eligible benefits. Regularly reviewing your strategy ensures you take advantage of every opportunity available.

Scott Higgins | AIF ®, CFP®, CPFA®, NSSA®

Financial Advisor

Securities and Investment Advisory Services Offered Through M Holdings Securities, Inc., a Registered Broker/Dealer and Investment Adviser, Member FINRA/SIPC. Rose Street Advisors is independently owned and operated. #5059445

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Many participants focus on how to save, but few think about how to withdraw. A thoughtful income strategy in retirement may reduce taxes, provide more flexibility, and increase the longevity of your nest egg.

Here are three simple guidelines to keep in mind:

1. Diversify your withdrawal sources

Use a combination of Traditional (tax-deferred), Roth (tax-free), and taxable accounts to manage income and stay in a favorable tax bracket.

2. Plan early for Required Minimum Distributions

Tax-deferred accounts require withdrawals beginning at age 73. This applies whether you need the money or not. Early planning can help reduce surprise tax bills later.

3. Use Roth accounts strategically

Roth funds are powerful for tax-free withdrawals. They can help you control taxable income as expenses rise or income shifts in retirement.

Bottom Line:

Withdrawing money strategically can be just as important as saving it. A well-designed plan may reduce taxes, improve income stability, and help your resources go further.

Scott Higgins | AIF ®, CFP®, CPFA®, NSSA®

Financial Advisor

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As a business owner or CFO, you know how important it is to attract and retain top talent. One powerful, but often overlooked, tool for rewarding key employees is a cash balance plan, especially when implemented retroactively for the prior year.

What Is a Cash Balance Plan?

A cash balance plan is a type of defined benefit plan that resembles a 401(k) in its individual account statements, but it’s fundamentally a traditional pension. Each participant has a “hypothetical account” that grows annually with employer contributions and interest credits. This allows for significantly higher contribution limits compared to a 401(k), particularly for older or higher-compensated employees.

Why Consider a Retroactive Plan?

If your company didn’t implement a cash balance plan last year, you may still be able to adopt one retroactively. This means contributions for the prior year can be made now, providing a unique opportunity to accelerate retirement savings for your executives while also potentially lowering your current-year taxable income.

Illustrative Example

Let’s say your company wants to reward a 55-year-old key employee with a $250,000 salary. Using a retroactive cash balance plan, you might be able to contribute up to $150,000 as a hypothetical example for the prior year. This far exceeds the $23,500 limit for a 401(k). This not only provides a meaningful boost to the employee’s retirement but also creates a tax-deductible expense for the business.

The Deadline for Retroactive Adoption

A cash balance plan can be adopted retroactively up to your company’s tax-filing deadline, including extensions, for the previous year. For most corporations, this means you can establish the plan as late as October 15 if you file for an extension. This flexibility allows business owners to evaluate year-end profits and cash flow before deciding on contributions.

Benefits at a Glance

• Increased Contributions: Retroactive contributions can be substantial, particularly for key employees.

• Attract and Retain Talent: Competitive retirement benefits are a strong incentive for top performers.

• Tax Advantages: Employer contributions are generally tax-deductible.

• Predictable Growth: Interest credits provide stable, predictable growth regardless of market fluctuations.

Considerations

• Cost and Funding: Retroactive contributions can be significant; ensure cash flow can support the plan.

• Complexity: Administration is more intricate than a 401(k), often requiring actuarial expertise.

• Employee Communication: Key employees benefit most; clear communication is critical to avoid misunderstandings.

Is a Retroactive Cash Balance Plan Right for Your Business?

If you want to reward high-performing employees, increase tax-deductible contributions, and potentially catch up on last year’s savings, a retroactive cash balance plan is worth exploring.

Next Steps

Work with a qualified retirement plan advisor to evaluate if this strategy fits your company’s goals and financial position. Acting before the tax-filing deadline ensures you don’t miss the opportunity to supercharge your retirement plan for key employees.

Scott Higgins | AIF ®, CFP®, CPFA®, NSSA®

Financial Advisor

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Two Simple Tools for Smarter Retirement Planning

When it comes to planning for retirement, a few simple rules can make complex concepts easier to understand. Two of the most helpful are the Rule of 72 and the Rule of 55. Both can give you quick insight into how your savings work and how you can make more informed decisions with your retirement plan.

The Rule of 72: How Fast Will Your Money Double?

The Rule of 72 is a quick mental shortcut to estimate how long it will take your money to double based on your rate of return. Just divide 72 by your expected rate of return.

Example:

If your retirement account earns a 7% average annual return, your money doubles roughly every 10 years (72 ÷ 7 = ~10.3).

Why it matters for employees:

• It helps you understand the power of starting early.
• It shows how even small increases in contributions or investment return can significantly grow your balance over time.
• It encourages long-term thinking rather than getting discouraged by short-term market noise.

The Rule of 55: Accessing Retirement Savings Penalty-Free

The Rule of 55 is an IRS provision that allows you to take penalty-free withdrawals from your employer-sponsored retirement plan (like a 401(k) or 403(b)) if you leave your job in or after the calendar year you turn 55.

Key points:

• It applies only to the plan sponsored by the employer you just left not to old plans or IRAs.
• Withdrawals are still taxable, but the 10% early withdrawal penalty is waived.
• This rule can be especially helpful for employees considering early retirement, a career change, or a phased transition out of the workforce.

How employees can use this in planning:

• Build flexibility into your retirement strategy knowing this option exists can reduce pressure.
• If you're planning to retire early, you may leave money in your current employer's plan to take advantage of the penalty-free access.
• Use it as a bridge until Social Security or other income sources begin.

Why These Rules Matter Together

While the Rule of 72 helps you understand growth, the Rule of 55 helps you understand access. One encourages long-term accumulation; the other provides short-term flexibility. Together, they give employees a clearer picture of both how their retirement savings grow and how they can be used as life plans evolve.

Scott Higgins | AIF ®, CFP®, CPFA®, NSSA®

Financial Advisor

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How Inflation Can Affect Retirement Savings and Ways to Mitigate Its Impact

Planning for retirement is challenging enough, but one factor often underestimated is inflation, the gradual increase in prices over time. Even modest inflation can erode the purchasing power of your savings, meaning the money you’ve set aside may not stretch as far in the future as it does today. Understanding how inflation works and taking steps to protect against it can make a significant difference in your long-term financial security.

How Inflation Impacts Retirement Savings

• Reduced purchasing power: A retirement goal of $80,000 annually today might require $110,000 or more in the future,
depending on inflation.
• Eroded investment returns: If your portfolio earns 6% but inflation is 3%, your real return is closer to 3%.
• Higher cost of living in retirement: Healthcare, housing, and daily expenses often rise faster than general inflation.

Historical Inflation Trends

Over the past 30 years, inflation in the U.S. has averaged roughly 2–3% per year, but there have been periods of higher inflation (such as the early 1980s and the recent 2020s) showing that rates can fluctuate significantly. Planning for a range of potential inflation scenarios is key to protecting your retirement lifestyle.

Strategies to Mitigate the Impact of Inflation

• Invest for growth: Incorporating equities can help your portfolio outpace inflation over the long term.
• Diversify your retirement accounts: Using tax-advantaged accounts like 401(k)s, IRAs, or Roth accounts can help increase
after-tax income.
• Consider inflation-protected investments: Options like Treasury Inflation-Protected Securities (TIPS) or certain annuities can offer
safeguards.
• Delay Social Security when possible: Benefits increase each year you delay up to age 70, helping protect income from inflation.
• Review and adjust regularly: Periodically updating your retirement strategy ensures your plan stays aligned with changing
economic conditions.

Next Steps

Inflation can quietly erode your retirement savings if left unaddressed. Take action now by reviewing your current retirement plan, assessing how it accounts for inflation, and exploring strategies to protect your future purchasing power. Schedule a consultation with a financial advisor today to create a plan tailored to your goals and safeguard your financial security in retirement.

Scott Higgins | AIF ®, CFP®, CPFA®, NSSA®

Financial Advisor

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Pre-Tax vs. Roth Retirement Savings: What’s the Difference?

When it comes to saving for retirement, choosing between pre-tax and Roth savings options is one of the most important decisions you’ll make. Both have unique benefits, and understanding their differences can help you make a choice that aligns with your financial goals and tax strategy. Let’s break it down:

Pre-Tax Retirement Savings

Contributing to a pre-tax account, such as a traditional 401(k) or IRA, means your contributions are made before taxes are deducted from your income. Keep in mind the annual contribution limits differences in an individual IRA or Roth and those of an employer sponsored retirement plan such as a 401(k).

Key Benefits:

• Immediate Tax Savings: Your taxable income is reduced in the year of contribution, potentially lowering your tax bill.

• Tax-Deferred Growth: Investments grow without being taxed until you withdraw them in retirement.

• Ideal for Higher Earners: If you’re in a high tax bracket now and expect to be in a lower one during retirement, this option may save you money in the long run.

Consideration:

• Withdrawals in retirement are taxed as ordinary income.

• Required minimum distributions (RMDs) begin at age 73, forcing you to take taxable withdrawals.

Roth Retirement Savings

Roth contributions, available in accounts like a Roth 401(k) or Roth IRA, are made with after-tax dollars. While there’s no immediate tax deduction, the long-term benefits can be substantial.

Key Benefits:

• Tax-Free Withdrawals: Qualified withdrawals of contributions and earnings are completely tax-free in retirement.

• No RMDs for Roth IRAs, Roth 401(k), Roth 403(b) and 457(b): You’re not required to take distributions during your lifetime, allowing your savings to grow tax-free indefinitely.

• Flexibility for Lower Earners: If you’re in a lower tax bracket now, paying taxes upfront may make sense.

Consideration:

• Contributions don’t reduce your taxable income in the year they’re made

• Recent tax rule changes no longer require RMDs from Roth 401(k) 403(b) 457(b) accounts similar to Roth IRAs.

Which Option is Right for You?

The best choice depends on your current tax situation, future income expectations, and retirement goals:

• If you anticipate being in a lower tax bracket in retirement, pre-tax savings may provide greater benefits.

• If you’re in a lower tax bracket now or want to hedge against future tax increases, Roth savings can offer tax-free income in retirement.

• A mix of both accounts can give you flexibility and diversification to manage taxes effectively in retirement.

• If a high income earner, there are no income limits to make Roth contributions to 401(k), 403(b), and 457(b) accounts.

• If you’re a younger age, a Roth may be advantageous with a longer timeframe to potentially benefit from compounding returns.

Final Thoughts

Understanding the differences between pre-tax and Roth retirement savings is key to building a tax-efficient strategy for the future. By weighing the pros and cons of each option, you can choose a path that helps increase your savings and decrease tax burdens

Julia Sanders | AIF ®, CPFA®

Retirment Relationship Manager

Meet Julia, a people-focused life-long learner with several years of experience in the retirement plan industry. Throughout her career, Julia has been committed to maintaining strong client relationships by providing incredible customer service. She is passionate about helping clients define and plan for their retirement goals. Julia’s daily role at the firm energizes and reinforces her commitment to client-focused work.