Every single morning, he would shuffle out the door in his white uniform, exhaustedly proclaiming, "Time to make the donuts!" In and out, back and forth, through all kinds of weather, Fred stayed loyal to the cause.
Today, the kids who grew up watching those commercials are now living that reality, heading to work day in and day out to make the dough. But retirement is when you finally get to hang up the apron for good. It is your time to eat the donuts while your investments go to work for you!
In retirement, it is the job of your savings to generate enough income to last for the rest of your life.
In Chapter 3 of The Wells of Wealth, we explore the Wells of Wealth system in depth, and explore how it can protect your nest egg and keep reliable, predictable income flowing even when markets are volatile.
Missed the other chapters? Not to worry! Check them out now:
During your working years, financial advisors often talk about the magic of compounding interest to accumulate wealth. However, as a Certified Financial Educator and Instructor, our founder and CEO Don Chamberlin warns about the exact opposite: compounding losses.
When you retire and begin decumulating your assets, you are spending your money. If you are relying on those assets for income and you withdraw money during a market downturn, you are compounding your losses. This phenomenon is known as Sequence of Returns Risk.
To understand how dangerous this is, imagine two sisters: Sam and Sally.
Using actual market returns from the S&P 500 index between 2000 and 2024, Sam (on the left of the graphic) experiences the down years at the very beginning of her retirement. As a result, Sam runs out of money 18 years into her retirement. Sally, on the other hand, experiences those same exact down years, but later in her retirement. Because she didn't compound her losses early on, Sally ends up with more than $2 million!
To protect your retirement, you cannot rely on a single financial product; you need a strategy. Generally speaking, financial vehicles possess three basic attributes: Safety, Liquidity, and Growth. No single investment gives you optimum performance in all three areas simultaneously.
At Chamberlin, we use a time-segmentation philosophy. This means we categorize your money into essential buckets, or "Wells," based on when you will need to spend it.
You’ve got the ingredients, let’s start cooking. Are you ready to build a retirement you deserve?
We invite you to schedule a 20-minute, no-fee strategy session with one of our trained and certified Retirement Educators. They are here to answer your questions without any pressure to sell you a product.
If you qualify to work with one of our holistic planners, you will receive a complimentary Chamberlin mini-plan. This plan includes three completely free reports:
Bonus: When you schedule your call, remind your Retirement Educator, and we will mail you a free copy of Don Chamberlin's new book, "The Wells of Wealth System"—and we will even cover the postage!
Not sure what to ask your Retirement Educator? Here are a few questions that can help you get oriented at the start of your planning journey:
Most people focus on the total balance of their 401(k). As you approach retirement, though, your focus should shift to cash flow. How much of your wealth is liquid and reliable (your future “Liquid” and "Conservative” wells), versus how much is subject to market swings that could disrupt your monthly income?
This is a "stress test" question. Your retirement educator can explain the "Sequence of Returns" risk — the danger of the market dropping right as you start taking withdrawals, leaving you behind for your entire retirement and in danger of outliving your money. They’ll explain the importance of a "buffer" to protect your lifestyle during a downturn.
Tax rates are not static. If the majority of your money is in a traditional 401(k) or IRA, you have a "lien" on your account held by the IRS. Ask the educator how you can balance your "Growth Well" with tax-advantaged accounts (like a Roth) to ensure you aren't losing 25–30% of your future spending power to taxes.
Social Security shouldn't be viewed in a vacuum; you have to look at your retirement holistically. The goal is to find the "sweet spot" where you maximize your lifetime benefits while using your private savings to fill the gaps efficiently. When you file can have other effects on your long-term plan as well, with the formula for survivor and spousal benefits taking the timing into account.
Pro Tip: Whenever you talk to a potential financial planning partner, listen for whether they give you a "one-size-fits-all" answer or if they ask follow-up questions about your specific goals. The best strategy is always the one most tailored to you and your needs, goals and dreams.
• • • • •
Chapter 1: Got Risk? The 3 Biggest Reasons Why People Run Out of Money
Chapter 2: Have It Your Way: 5 Steps to Planning Your Retirement Income
Chapter 3: Time to Make the Dough-nuts: How to Avoid Running Out of Money in Retirement
In the meantime...
Any reference to free or complimentary services/products does not obligate a prospective client to engage the firm or its representative for any future services.
As of the writing of this book and blog post, the author is an investment adviser representative and supervised person of Foundations Investment Advisors, LLC (“Foundations”), an SEC registered investment adviser. The opinions and assertions expressed in this book are solely those of the author and do not necessarily reflect the views of Foundations. Foundations’ involvement with this book has been limited to performing a high-level compliance review. No compensation related to this book will be directly or indirectly shared with or remitted to Foundations.
This book includes, among other things, general concepts about investment strategies, including retirement-focused strategies, some of which are explained in the book through the use of case studies and examples. Nothing in this book is intended to provide any specific or targeted investment, financial, tax, or legal advice. Individuals are strongly encouraged to consult with their own investment, financial, tax, and legal professionals regarding these matters.
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The stories and characters in this book are purely fictional or are based upon real-life events that have been both anonymized and modified. Each story combines facts and circumstances that have been redacted or modified to highlight the subject matter of each chapter. These facts and circumstances are not intended to represent any one client, either in part or in whole, and they are included solely as educational tools. No story should be interpreted as applying to any reader's or person’s individual situation or circumstances or be construed as personalized investment advice. Always consult with your tax professional, attorney, and financial adviser regarding such matters.
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A Roth conversion may not be suitable for your situation. The primary goal in converting retirement assets into a Roth IRA is to reduce the future tax liability on the distributions you take in retirement, or on the distributions of your beneficiaries. The information provided is to help you determine whether or not a Roth IRA conversion may be appropriate for your particular circumstances. Please review your retirement savings, tax, and legacy planning strategies with your legal/tax advisor to be sure a Roth IRA conversion fits into your planning strategies.
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