The Definitive High Net Worth Retirement Planning Guide

We understand the concerns that high-net-worth individuals and families may face as they approach retirement. Insights gained from decades of experience working with wealth management clients highlight the importance of thoughtful, customized retirement planning.

Whatever lifestyle you are accustomed to and whatever your net worth, gaining a deeper understanding of wealth management and retirement planning strategies can help build greater financial confidence for the future.

Whether or not you are ready to talk to someone, it is important to stop worrying and start planning for your high-net-worth retirement.

Consider the situation involving the Barclay brothers. David Barclay suspected that his brother Frederick was attempting to sell the Ritz Hotel in a way that would primarily benefit Frederick’s daughter. In response, one of David’s sons installed a secret audio recording system in the conservatory at the Ritz, where Frederick often held private conversations.

As a result, David’s side of the family was able to listen to 94 hours of recordings, capturing over 1,000 conversations between Frederick, his daughter, their lawyer, and various prospective hotel buyers.

However, Frederick began to suspect that something was wrong, noticing that David always seemed to be one step ahead. In turn, Frederick installed a secret video camera and caught David’s son planting another listening device.

How to Stop Worrying About the Uncertainty of High Net Worth Retirement

No one is completely immune from concerns about retirement planning — not even high-net-worth households. While it may be somewhat easier for families who have selected their wealth management partners carefully, planning for retirement remains a significant focus. For those in the highest income tax brackets, accumulating and preserving retirement savings is especially important for securing future financial stability.

But what does it really mean to plan effectively for high-net-worth retirement? How do you shift from uncertainty and anxiety to a sense of confidence and serenity — feeling “all set” and ready to fully enjoy life?

Before answering that, it is essential to begin by facing retirement reality.

Retirement Reality Check

If we define “retirement” as ceasing to work at a job that provides a regular net income, then the first step in retirement planning is to assess what will happen on the very first day after you leave employment. In general, working with a retirement planner can help you develop investment strategies and financial planning approaches to support a secure high-net-worth retirement.

Here’s what typically happens:

• Your employment income drops to $0, unless you retire late enough to claim Social Security (the timing of which involves complex decisions) or you have a pension.
• Major expenses — both planned and unplanned — will no longer be replenished by earned wages.
• You will rely entirely on your investment portfolio, savings, or any passive income streams, such as income-generating real estate or business interests.

For example, if you were allocating $30,000 per month in total expenses to support your lifestyle while working, that same amount will now need to come entirely from your investments and savings.

This is the reality of high-net-worth retirement — and it explains why concerns about financial stability are common even among high-net-worth individuals and families. It’s not about fear of missing out (FOMO); it’s about fear of running out (FORO) — and it highlights why now is the time to implement strategies that help protect your wealth for the future.

The First 3 Steps to Setting Your High Net Worth Retirement Goals

Before you actually retire and transition away from earned income, it is important to take the following three steps:

List out your living expenses

This includes everything.

Mortgage payments, if any. Payments toward outstanding loans or debts. Membership fees. Donations. Food. College tuition payments. Healthcare costs. Home repairs. Pet expenses. Insurance premiums. Dining. Entertainment. Transportation. Travel. Gifts. Every regular and discretionary expense should be considered.

Many Americans who work for a company have been enrolled in a 401(k) retirement plan, but even so, it remains critical to understand your personal cash flow and future needs.

Ask yourself: How much are you spending each month? How flexible are these expenses? To what extent do you actively control your spending habits? For example, if you currently spend $30,000 per month, would it be possible to reduce this to $25,000 without significantly changing your lifestyle? Tax planning considerations should also be factored in.

However, before assuming that retirement must require cutbacks, consider this: high-net-worth individuals who engage in customized retirement planning often find they are able to maintain — or even enhance — their spending levels in retirement. Optimizing your financial strategy may allow you to enjoy an even more expansive lifestyle while still preserving long-term financial security.

For instance, you may decide to allocate $55,000 per month if you plan to travel more extensively after retirement, compared to your current spending levels.

How can you determine what level of spending is sustainable for your situation?

You can continue reading to explore strategies designed to help ensure that your retirement goals align with your overall financial security.

Determine What You Want to Do with Your Time

Many experts agree that the key to a successful and fulfilling retirement is preparation.

Retirement opens up a wide range of possibilities. While your earned work income may end, your freedom to manage your time expands greatly.

You might choose to:

• Travel
• Spend more time with family and friends
• Enjoy your vacation home
• Volunteer for causes you care about
• Play golf or go fishing
• Learn a new language
• Help your children or grandchildren start a business
• Relax and unwind
• Spend time on a yacht
• Write a book
• Pursue many other personal interests

Without a clear plan, however, you may find yourself spending valuable years of high-net-worth retirement feeling uncertain or unfulfilled — passing time with activities like watching sports or television without a deeper sense of purpose. This is why prioritizing retirement planning and savings is so important.

There is a difference between intentionally planning for leisure and simply drifting into it without direction. Planning to enjoy activities such as sports and relaxation is perfectly valid. However, ending up in that routine by default — without a proactive plan — can lead to a sense of missed opportunities during retirement.

Studies have shown that retirees who remain physically, mentally, and socially active tend to experience happier, more fulfilling retirements. Some of these activities may even help reduce the risk of certain diseases, including Alzheimer’s.

According to psychologist and author Robert Delamontagne, PhD, many retirees experience anxiety, depression, and feelings of loss — often without speaking about it.

For high-net-worth retirees, these feelings can be particularly challenging. There may be a sense of embarrassment, given the perception that financial security should guarantee happiness. However, the reality is that emotional challenges during retirement are common, even among those with substantial assets.

One contributing factor is the lack of a structured plan. Thoughtful wealth and lifestyle planning can help retirees transition more confidently and with a greater sense of purpose.

Determine Your Retirement Monthly Income

With a clear understanding of your expenses and your retirement activity plans, the next step is to determine the monthly income needed to support your desired lifestyle.

It is important to calculate this figure as precisely as possible.

High-net-worth individuals may benefit from working with a financial advisor to align investment strategies with retirement goals. For example, tax-efficient investments such as Roth 401(k)s or Roth IRAs can offer the advantage of tax-free growth and tax-free withdrawals. Investments in dividend stocks may also contribute to steady income streams over time, supporting a comfortable retirement lifestyle.

While working, precision in budgeting is less critical because income replenishes regularly. In retirement, however, your portfolio becomes your primary financial resource — making careful planning essential.

By identifying your expenses, envisioning your retirement lifestyle, and calculating your required monthly income, you build the foundation for a strong high-net-worth retirement plan — one that can help support both your financial security and your personal aspirations for the years ahead.

Know Your Income Sources in Retirement

With your high-net-worth retirement plan foundation in place, the next step is to determine where your income will come from during retirement.

If you own real estate or other passive income-generating assets, you may have additional flexibility. If not, your high-net-worth retirement income will likely rely on three primary sources:

• Investments (IRAs, 401(k) accounts, equities, bonds, and similar holdings)
• Cash reserves (CDs, savings, money market accounts)
• Fixed income streams (Social Security benefits, pension plans)

While there are exceptions and variations within each of these categories, for most individuals, these are the key pillars of retirement income.

The essential question to ask is:
Do I have enough resources across these areas to sustain the lifestyle I envision for my high-net-worth retirement?

For example, suppose you have accumulated a $4 million portfolio and have just turned 55. If you plan to retire at age 60 and expect to live until 90, will your resources be sufficient to support your desired monthly income for three decades?

That is the fundamental question.

And ultimately, that is the question that matters most when planning for a secure retirement.

$4 million may seem like a substantial amount. So does $10 million. However, if you are accustomed to living on $50,000 per month — or $600,000 per year — a $4 million portfolio will not sustain that lifestyle for very long, certainly not for 30 years.

So how do you answer the crucial question:
Do you have enough to cover your expenses, support your future plans, and fund your high-net-worth retirement lifestyle over the long term?

Adding another layer of complexity — if you intend to leave an inheritance to your heirs, how can you be confident there will be assets remaining at the end of your retirement?

This is why careful planning and choosing the right wealth management strategy are critical steps toward long-term financial security.

Retirement Planning Answers: Find Your Comfort Zone

In effective retirement planning, identifying your “Comfort Zone” is not just a concept — it is a quantitative, measurable financial target.

If your portfolio is positioned within your Comfort Zone, then the answer to the all-important question — “Do I have enough for a secure, high-net-worth retirement?” — is yes.

It can be that straightforward.

When your financial assets align with your spending needs, projected over time, your plan can support both your lifestyle and your long-term financial goals. Because investment markets are inherently volatile, creating resilient, diversified investment strategies is essential to maintaining this security.

If you have concerns about whether your current portfolio fits your long-term needs, it may be worthwhile to review your retirement plan with a qualified financial advisor. A fresh assessment can help ensure that your investments are structured to support your goals — and adapt to life’s unexpected changes.

So what is the Comfort Zone, and how do you know if your portfolio lies within it?

The process begins by applying 1,000 stress tests — what are referred to as “what if” scenarios — to your portfolio. These tests evaluate how your portfolio might perform under a variety of challenging economic and market conditions, such as experiencing two recessions within ten years or enduring a terrorist attack combined with a major natural disaster.

Across these 1,000 scenarios — ranging from moderate to extreme — historical market data from the past 100 years is used to analyze portfolio resilience. By understanding how markets have responded to real-world events, it becomes possible to assess the level of confidence you can have in achieving your life objectives.

This is a historically supported, quantitative, and data-driven high-net-worth retirement planning process.

You can have high confidence in reaching your goals if 75–90% of the stress test scenarios — what defines the Comfort Zone — project that your portfolio will exceed (not just meet) your retirement plans and financial targets.

If your portfolio lies within that Comfort Zone, you can move forward with retirement feeling more secure, less stressed, and free to pursue your plans and dreams.

Earlier, it was mentioned that some retirees even find they can increase their spending in retirement. This insight often comes from Comfort Zone analysis.

For instance, returning to the earlier example of a retiree spending $30,000 per month — after running the 1,000 stress tests, it may turn out that the individual could increase spending to $55,000 per month while still remaining within the Comfort Zone.

This means they can enhance their lifestyle without added concern about outliving their assets or needing to scale back later.

Now, on the other hand, analysis may reveal that spending $30,000 per month places a family’s portfolio outside the Comfort Zone — falling below the 75% confidence level. In such cases, adjustments can be explored to bring the retirement plan back into the 75–90% confidence range. These adjustments may not necessarily involve reducing monthly spending. For instance, reducing the amount allocated to future inheritances — such as adjusting a $2 million intended gift to $1.5 million — might be sufficient to restore the plan’s strength.

This approach to high-net-worth retirement planning highlights the importance of flexibility. It not only considers liquid investments, but also incorporates an in-depth review of real estate holdings, passive income sources, trust and estate structures, insurance policies, Social Security strategies, and projected medical costs.

Comprehensive retirement planning draws on data-backed analysis, not guesswork. It enables individuals and families to make informed decisions, using impartial, historically supported financial models rather than relying on uncertainty or assumptions.

By evaluating all aspects of your financial picture against detailed stress-testing scenarios, you gain a clearer understanding of whether your retirement goals are fully supported — and what adjustments, if any, might strengthen your long-term financial security.

What Is a High Net Worth in Retirement?

Having a high net worth in retirement typically means possessing at least $1 million in investable assets. These assets include cash, bank accounts, stocks, mutual funds, and other investment vehicles that can be readily converted into cash when needed.

If you are planning for retirement, it is essential to ensure that you will have sufficient income to maintain your current lifestyle — or to support a new one if your plans evolve. Taking proactive steps to prepare your financial foundation is key to a secure and fulfilling retirement.

Calculate How Much You Need to Save

When regular paychecks stop, you will rely on retirement benefits, personal savings, and income from investments to cover your expenses.

If you have been saving consistently and tracking your expenses over time, you are already building a strong foundation for estimating future needs. Ideally, tracking your spending over several years gives a clearer picture of patterns and changes.

You may notice that your expenses shift over time. For example, children may leave home, reducing household costs, while medical expenses may gradually increase. Carefully tracking these changes can help you project future financial requirements more accurately.

As you approach retirement, your overall spending may decrease. However, if you are accustomed to a high-consumption lifestyle as a high-net-worth earner, you may wish to continue supporting a more expansive lifestyle throughout retirement.

Whatever your situation, it is important to be realistic about your needs. In general, many individuals find that their financial requirements lessen over time, especially after major life goals have been met.

Once you have calculated your estimated annual expenses, consider your life expectancy. Multiply the number of years you expect to live by your annual expenses to approximate the total amount of savings you may need to sustain your retirement lifestyle.

Max Out Your Retirement Accounts

Maximizing your savings is important — and so is maximizing your retirement account contributions.

As a high-net-worth individual, you may have the ability to contribute the full allowable amounts to your retirement accounts. For example, in 2022, individuals can contribute up to $20,500 to a 401(k) plan and up to $6,000 to an IRA. Those aged 50 and older are eligible to make additional catch-up contributions — an extra $6,500 to a 401(k) and an additional $1,000 to an IRA.

In addition to withdrawals from retirement accounts and annuities, your retirement income may also include Social Security benefits, personal savings, and returns on investments. Monitoring your investment performance and maintaining a strategy to maximize retirement earnings are important steps in building long-term financial security.

Plan for Medical Expenses and Long-Term Care

It is likely that your medical expenses will increase after retirement, especially if you have existing medical needs or use prescription medications. Even with Medicare coverage, retirees typically face out-of-pocket costs for prescriptions and other medical services.

To prepare, consider maximizing contributions to a health savings account (HSA) if eligible. HSA contributions are tax-deductible, and withdrawals used to pay qualified medical expenses are tax-exempt, offering both immediate and long-term financial benefits.

It is also important to consider the potential need for long-term care. The cost of long-term care insurance varies depending on the age at which you begin paying premiums. Planning ahead for this possibility may help protect your assets later in life. Some estimates suggest setting aside an additional $250,000 to cover potential long-term care expenses after age 85.

However, it is important to weigh the decision carefully: purchasing long-term care insurance involves ongoing premium payments, and it is possible that coverage may never be used.

Minimize Your Tax Liability

Working with a financial advisor, you can manage your asset diversification in a way that helps minimize the capital gains taxes you may owe.

Strategies may include delaying withdrawals from tax-deferred accounts, such as a 401(k), to defer taxable income. Increasing charitable contributions can also reduce your overall tax burden.

Additionally, some individuals choose to relocate to states with no state income tax — such as Florida or Alaska — as part of their long-term tax planning strategy.

Estate planning

In addition to preserving your wealth for retirement, it is important to protect your assets for future generations.

An estate plan ensures that your assets are distributed efficiently and according to your wishes. Establishing a trust as part of your overall estate strategy can help minimize tax exposure, as a trust is considered a separate taxable entity. Trusts can also be created during your lifetime and may be structured as revocable (changeable) or irrevocable, depending on your long-term goals.

To continue exploring your financial planning options: