Can You Actually Retire?

A Five-Step Framework to Know—And Act—With Confidence

The single most common question I get after two decades of advising families sounds deceptively simple: “Can I retire?” What people really mean is, Can I quit the paycheck, turn on my savings, and still sleep at night?

Below is a five-step process that answers that question with data and peace of mind. I’ll illustrate each step with “Steve and Cheryl,” a fictional couple whose numbers mirror many real households.

1. Pin Down Where You Are—Right Now

Think of this as the financial equivalent of a doctor’s vitals check. Forget future guesses for a moment; record only today’s facts.

• Age & Income – Steve is 61 and earns $150k.

• Automatic Savings – 10% of salary lands in his 401(k).

• Core Spending – After taxes and savings, $7k a month flows out the door, leaving $2k surplus. Annual lifestyle: $84k.

• Liquid Reserves & Investments

o 401(k): $1.2 M

o Brokerage: $190k

o Cash emergency fund: $35k

• Future Income Sources

o Pension: $3k/mo starting at 65

o Social Security (at 67): $3,100/mo for Steve; spousal benefit for Cheryl

No budget spreadsheets, no guesses about “lower expenses in retirement.” List real inflows and outflows.

2. Describe Your Dream Retirement—Fast, Then Refine

Hit the mental buzzer Family-Feud style: What’s the first age you’d love to stop working? Steve’s answer: 62 (January, barely six weeks away).

Dream first; adjust later. Most people assume that date is impossible and keep working by default. You won’t know until you test.

3. Run the First Draft Plan

Using their actual savings, spending ($108k after-tax “paycheck replacement”), and desired start date, a Monte Carlo simulation shows 98% probability of success—with $2.9 M still left at age 90. In plain English: markets could behave like a thousand past scenarios and Steve & Cheryl would be fine in 98% of them.

Great—but that’s only the starting gate.

4. Stress-Test the Plan (Where Real Confidence Is Born)

A plan that only works in rosy markets isn’t a plan. Stress tests reveal the first things that would break your retirement so you can fix them before they happen.

Scenarios tested

1. Bear market next year (-25%) – probability drops to 76%. Slight caution, but still workable by trimming annual spending from $108k to $106k.

2. Extra healthcare costs at age 80 ($15k/yr) – plan holds at 96%.

3. Five-year long-term-care stay at 85 ( $80k/yr) – 82% success.

4. Bear market plus both healthcare shocks – 28% success. Red flag: they need either LTC insurance or a larger cash buffer.

Outcome: Steve can retire, but they add a hybrid long-term-care policy and cap voluntary spending if a major downturn strikes in the first five years.

5. Flip the Switch—Then Automate & Review

Before the final day at work

• Turn on any pensions or guaranteed benefits (know the paperwork and deadlines now).

• Link IRA/401(k) custodians to your checking account for seamless transfers.

• Set tax withholding on every planned distribution. Surprises at tax time are momentum killers.

• Automate withdrawals—monthly or quarterly—to mimic a paycheck. Decisions made once in calm water beat ad-hoc transfers during volatility.

• Schedule plan check-ups at least annually (quarterly is better in the first two years). Markets change, spending drifts, life happens.

The Big Lesson: Confidence Outweighs Rules of Thumb

Steve and Cheryl never had to ask, “Is 80% of salary enough?” or “Is the 4% rule still safe?” Personalized numbers replaced one-size-fits-all advice, and ongoing stress tests replaced fear.

Your turn

1. Capture today’s facts.

2. Write down your dream date.

3. Model it.

4. Break it on purpose and patch the weak spots.

5. Automate, live, and review.

Do that, and the question “Can I retire?” shifts from worry to clarity—then to action.

Need a second set of eyes on your own five-step run-through? Grab a complimentary retirement stress test with our team via the link below, and we’ll map the scenarios that matter most to you.

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