There is a perception today that people of the millennial generation do not care about retirement.  I don’t think this is true at all.  I work with numerous millennials and their families.  My experience suggests that they are indeed interested in retirement, but they do seem uncertain about how to take control of it.  Many millennials are also very busy raising families and building their careers, which leaves them little time to focus on a complex area like retirement. 

I have discovered a strategy that creates clarity for young people who want to put a retirement plan in place that they can be confident in.  This strategy is about recognizing three areas that impact your retirement (no control, some control, complete control) and focusing on those areas you do control.  This approach produces peace of mind for my clients and a sense that they are doing everything in their power to live their desired lifestyle in retirement.  Let’s explore those three areas together.  



If you want to take control of your retirement and you’re feeling rather uncertain about the future, let me recommend three areas to think about.  

  1. Areas where you have no control.
  2. Areas where you have some control.
  3. Areas where you have total control.

I’ll give you specific examples of each of these areas as we explore them below.  But for now, here is the main point I want to make.  

The key to building a retirement plan you can be confident in is to take the best, the most informed and the most disciplined long-term action possible in those areas where you have total control.  This approach puts you in the best possible position to live your desired lifestyle in retirement.  

You also want to take reasonable steps in those areas where you have some control.  My advice about those areas where you have no control is to keep an eye on them, but don’t let them become the primary driver in how you make decisions.  

I know that probably sounds like a really simple formula.  But after serving clients for more than a decade, I haven’t found a better approach to thinking about retirement and building plans that you can stick to and be confident in.  And here’s the thing I think is important – if you’re not confident in something, it’s unlikely you’ll stick to it for the long term and that’s exactly what it takes to achieve retirement goals – long-term commitment. 

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"I enjoy working with young professionals and helping them chart their course toward their financial future. I also enjoy working with my colleagues on the Investment Committee to create solutions for our clients."


There are many things you don’t control in life.  This can be quite frustrating, especially if you build plans that anticipate outcomes for areas that you don’t control.  As it relates to retirement, I see two key areas where the average person has almost no control:

  • Government policies, particularly regarding taxation, savings and benefits
  • Market returns and overall market performance

Here is my advice about those areas where you have no control.  Don’t let them prevent you from taking meaningful action.  It’s not as if you should forget about them, but I also don’t recommend that you lose sleep worrying about them.  Since you don’t control them, there is little you can do about them.  

One need look no further than the recent TCJA (tax cuts and jobs act) to realize that the average person has little influence on government policies.  The TCJA introduced some significant departures from prior tax policies and we spent many hours analyzing these and advising our clients about how to adapt to them.  

Will a new administration roll back these changes?  Very possibly.  Will new tax laws hit you in the wallet?  That could very well be the case.  If there’s one thing I’ve learned about the government, it’s that predicting what’s next is very difficult and ultimately out of your control.  Over the years, government policies will almost certainly change.  You should take advantage of any current tax legislation that you can, but don’t hinge your long-term retirement goals on them.  

Another factor that is out of our control is the overall market returns year to year.  Let’s face it, the market is going to do what the market wants.  Trying to guess which direction the market is going to move in the short-term is a losing strategy.  

Some people seem to believe that the key to retirement is primarily based on their investment returns.  Although your investment returns assist you in reaching your retirement goals, there are many other factors that weigh more heavily on your success and you have more control over them.

So here is my advice to you.  If your retirement plan today is based on above-average rates of market return, and if you are watching stock tickers every day with anxiety, it’s probably time for a change.  Do you really want to keep doing that for the next 20-30 years?  That type of behavior typically does not produce confidence, peace of mind or long-term commitment.   

I believe a much better strategy is to develop a retirement plan built on reasonable projections of market rates of return.  This is where historical data can be a good guide.  That is not to say that the historical data will be entirely accurate.  But it may just be the best we have to go on today.  



There are two areas that might have a real impact on your retirement where you have some control: 

  • Your employment earnings and age of retirement
  • How long you live and your health as you age

Income generation is how most people will fund their retirement.  You build up your nest egg over many years of productive work, earning a good income.  The higher your income, in most instances, the better positioned you are to put money away toward retirement (at least in theory).  The longer you work, the more you probably have saved once you retire.  

There are many factors that will influence how long you work and how much income you’ll generate.  You are probably in control of some of those factors, especially the age at which you choose to retire.  But there are many other factors you do not control, especially how much you earn.  Many people, it seems, top-out their earning potential in their mid-fifties.  

Longevity is an area where you may or may not have control.  For many of the clients that I serve, outliving their money is a real concern.  Let’s assume that you retire at age 65 and your genetics and healthy lifestyle predispose you to live to age 90.  That means your retirement nest egg would need to fund 25 years of annual living expenses – let alone what you leave to heirs. 

But the challenge that many people face is that their expenses will go up, especially as their need for healthcare goes up, later in life.  While you can control this to some degree with a healthy diet and exercise, your efforts may or may not preserve retirement savings as you had hoped.  

For example, it is entirely possible that your annual cost of living between ages 85-90 could be more than triple your annual cost of living between ages 65-84, possibly much more than that.  Many people need 24-hour care once they reach a certain age.  In other words, most of your retirement nest egg could be consumed in the last few years, or even last few months, of your life.  

This is why I recommend that you put a plan in place to account for these expenses.  Both long-term care insurance and good healthcare insurance can minimize expenses that consume retirement nest eggs.  This is especially important for people who know that their genetics predispose them to certain health issues.  

My point here is simply this.  By all means, work as long as you want and earn as high an income as you can.  Exercise, take vitamins, eat a healthy diet and maintain your vitality for as long as possible.  But also recognize that you don’t control many factors here that could have a real impact on your money.  So be sure that your retirement plan accounts for these factors.



There are two important areas that impact your retirement where you have total control:

  • Your saving versus your spending
  • How you allocate and locate your investment assets

I have written numerous other articles about the importance of financial discipline, living within your means and following a financial plan.  I won’t belabor the points I’ve made in those other articles.  But I will say for the record that, more than likely, the number one driver in your retirement outcomes will be how much you save.  I encourage young people to save 15%-20% of their annual household income, if possible.  

That might seem like an unrealistic number to you.  Yet, after working with dozens of young families on their financial plans, we have found ways to substantially increase their savings.  Usually this requires a careful financial analysis of what you are actually spending today compared to what you really need to spend to live a desirable lifestyle.  

I find that there is a tradeoff here that my clients don’t regret.  The choice in front of you is, more than likely – keep spending as you are today and live with that gnawing concern about the future at the back of your mind – or – engage in a careful analysis of your spending habits for the last year or so and find ways to increase savings.   

The clients I have taken through this exercise have never come back to me and said – “hey Mike, I wish we hadn’t done that.”  My clients seem to really appreciate the sense of control that this exercise brings to their situation.  They become much more confident about their retirement.

Now let’s look at investments.  I encourage you to both save and to invest.  How you allocate and locate your investments will probably be the second most important driver in your retirement outcomes.  You should have nearly total control over asset allocation and location.  Asset allocation is about what you invest in.  Asset location is about how your retirement investments are made tax-efficient or inefficient.  

When I advise Millennials about asset allocation strategies, we look at a number of different variables, many of which are unique to their personal situation.  The way we choose to allocate their assets amongst different asset classes will be the primary driver of their long-term rate of return.  

Some variables that I take into consideration include their age, their willingness to take risk (so they sleep well at night) and their financial ability to take risk (how much they can afford to take).  Asset allocation decisions usually evolve over time, as their situation changes.  How they’re invested today may be quite different in 5 years, depending on their personal situation and the investment environment. 

Asset location is a strategy to minimize your tax burden and take advantage of the way that different types of investments receive different tax treatments.  Using this strategy, I help my clients identify which securities should be held in tax-deferred accounts and which securities should be held in taxable accounts to maximize after-tax returns.  

How an investment is taxed in today’s current environment will determine where it should be located (taxable account, IRA, Roth IRA, 401(k), etc.).  This decision may seem rather insignificant.  However, we have run analyses for our clients that show them how asset location strategies produce significantly better after-tax returns within just a few years.  If you are not carefully analyzing your asset location strategy, I recommend that you do so soon.  



If retiring with a comfortable lifestyle feels like something you just can’t get your arms around, it might make sense for us to have a conversation.  I work with numerous young professionals today and with the adult children of affluent parents.  The approach I’ve outlined in this article provides real peace of mind and a sense of being in control to the clients I serve.  If that’s something you’d like to achieve, let’s talk.  


© 2019 Whitnell & Co.  The information contained in this article is provided for informational purposes only.