Both Ends: Seed & Harvest
No retirement plan is complete without looking at both ends. The Seed phase is where investing happens — where products are designed to grow your wealth. Just as important is the Harvest phase — when distributions take place and you live on what you built.
The Seed Phase
The accumulation years. Contributions flow in, investments grow, and time does the heavy lifting through compounding. Many products are designed with attractive seed-phase features. The goal: maximize growth while managing risk as retirement approaches.
The Harvest Phase
The distribution years. How, when, and from which accounts you draw income determines your tax burden and how long your assets last. Many plans are tax-deferred — taxes not collected during the seed phase are levied at harvest. There are products that can eliminate or reduce taxes at distribution time.
While tax deferral is beneficial in many cases, it does not have to be your only approach. Tax-free growth products — properly structured life insurance, Roth accounts — allow distributions in retirement without adding to taxable income. Building both tax-deferred and tax-free sources gives you flexibility to draw income tax-efficiently in any year. See Spend Down and Required Minimum Distributions.
Susan Elias, licensed fiduciary — we provide free, no-obligation consultations to review your retirement situation, identify gaps, and explore strategies appropriate for your specific circumstances. Contact us to schedule yours.