retirement-decumulation

This skill guides you through the math of turning a retirement portfolio into lifetime income. It covers sequence-of-returns risk, the 4% rule and its limits, dynamic guardrails strategies, Social Security claiming optimization, RMD calculations, Roth conversion tactics during gap years, bucket versus total-return approaches, and annuitization as longevity insurance.

Retirement Decumulation helps you calculate safe withdrawal rates and design a sustainable income plan for your retirement years.

AI-generated summary based on this skill's SKILL.md

★ 159 ⁮ 32 MIT updated 2026-07-18 by JoelLewis

Install

JoelLewis/finance_skills/retirement-decumulation · repository language: Python

Manual (git clone) CLI (skillfed)

git clone https://github.com/JoelLewis/finance_skills
cp -r finance_skills/plugins/wealth-management/skills/retirement-decumulation ~/.claude/skills/retirement-decumulation

npx skillfed install JoelLewis/finance_skills/retirement-decumulation

Frequently asked questions

AI-generated answers based on this skill's SKILL.md and metadata

How much can I withdraw from my retirement portfolio each year?

retirement-decumulation helps you calculate a sustainable withdrawal rate by modeling sequence-of-returns risk, inflation, and longevity. The 4% rule is a common starting point—withdrawing 4% of your initial portfolio in year one, then adjusting for inflation annually—but retirement-decumulation shows why this rate varies with your time horizon, asset allocation, and market conditions. Guardrails strategies let you adjust spending dynamically: increase withdrawals when markets outperform, reduce them after downturns to protect your portfolio.

When should I claim Social Security to maximize lifetime benefits?

retirement-decumulation optimizes your claiming age by weighing early claiming (reduced monthly benefit but longer collection window) against delayed claiming (larger monthly benefit starting at 70). The skill factors in your life expectancy, spousal and survivor benefits, and tax implications. Breakeven analysis shows the age at which delayed claiming overtakes early claiming in cumulative dollars, helping you align your strategy with your health, family longevity, and income needs.

What is sequence of returns risk and how do I avoid it?

retirement-decumulation explains sequence-of-returns risk: poor market returns early in retirement can permanently damage your portfolio's ability to sustain withdrawals, even if long-term average returns are strong. The skill models this risk through historical and Monte Carlo simulations. Mitigation tactics include guardrails (spending rules that adjust to market performance), bucket strategies (holding 2–3 years of expenses in bonds), and annuitization (converting part of your portfolio into guaranteed income).

How do required minimum distributions and RMD penalties work?

retirement-decumulation calculates your RMD using IRS life-expectancy tables and your account balance, starting at age 73 under SECURE 2.0. The skill shows how to coordinate RMDs across multiple accounts, plan Roth conversions during gap years (before RMDs begin), and avoid the 25% penalty for missed distributions. Strategic RMD planning reduces lifetime taxes by managing ordinary income, Medicare premiums, and Social Security taxation.

Should I buy an annuity, and what's the difference between bucket and total-return strategies?

retirement-decumulation evaluates single-premium immediate annuities (SPIAs) as longevity insurance: they trade portfolio flexibility for guaranteed lifetime income, ideal for covering essential expenses. Bucket strategies hold 2–3 years of spending in bonds, reducing the need to sell stocks during downturns; total-return investing rebalances a diversified portfolio and withdraws from it systematically. The skill helps you compare these approaches and design a hybrid income floor using annuities plus dynamic withdrawals.

What's a Roth conversion and when should I do one during gap years?

retirement-decumulation guides Roth conversions—moving pre-tax IRA funds to a Roth IRA and paying tax upfront—during gap years between retirement and RMD age (73). Converting when your income is low minimizes tax, and the Roth grows tax-free forever. The skill models the tax cost, tracks pro-rata rules (taxable and non-taxable IRA balances), and shows how conversions reduce future RMDs and lifetime tax burden while building tax-diversified retirement income.

SKILL.md

rendered from the published skill — quoted content, verbatim