Retirement planning has its own language. Here are the terms that come up most often in our conversations, defined plainly, the way we'd explain them across the table.
01
Foundations
Fiduciary
A fiduciary is a financial professional who is legally and ethically required to act in your best interest, ahead of their own. That means recommendations are made for your benefit, not to satisfy a sales quota or earn a higher commission.
Not everyone who offers financial advice is held to this standard. It is a fair thing to ask directly, because the answer tells you whose interest sits first in the relationship.
How we think about it
Acting as a fiduciary is the starting point of every relationship at Marshall Wealth Management, not a feature we add on. It reflects the principle we're built on: our clients don't care how much we know until they know how much we care.
Fee-Based vs. Commission
These describe how a financial professional is paid. In a fee-based arrangement, you pay a transparent fee for advice and ongoing management. In a commission arrangement, the professional earns compensation tied to the products you buy. Neither is inherently good or bad, but the structure shapes the incentives, so it is worth understanding up front.
Comprehensive Financial Plan
A written framework that looks at your whole financial picture together, income, taxes, investments, insurance, healthcare, and legacy, rather than treating each piece in isolation. At Marshall Wealth Management this is delivered through The Marshall Plan, which examines seven key areas so the parts work with one another instead of against one another.
02
Retirement Income
Sequence of Returns Risk
The order of your returns, not just the average
Sequence of returns risk is the danger that poor investment returns early in retirement do lasting damage, even if your long-term average looks fine. The reason: once you are withdrawing money, a downturn forces you to sell more of your holdings to cover the same income, leaving less to recover when markets rebound.
Two retirees can earn the same average return over time and end up in very different places purely because of the order in which good and bad years arrived. This is why the first few years of retirement carry outsized weight.
Why it matters
Managing this risk is one of the central reasons a growth-focused portfolio and a retirement-income portfolio are not the same thing.
Retirement Income Planning
The process of turning the savings you accumulated during your working years into dependable income that lasts through retirement. It shifts the central question from "how much have I saved?" to "how do I turn what I have into a paycheck that lasts?"
Longevity Risk
The risk of outliving your money. As life expectancies rise, a retirement plan increasingly has to account for the possibility of a thirty-year retirement, which changes how conservatively income needs to be structured.
Social Security Timing
The decision of when to begin claiming Social Security benefits, which can meaningfully affect the total income you receive over your lifetime and how a married couple coordinates two benefits. Because the right choice depends on your health, other income, and spouse's situation, it is worth reviewing carefully rather than defaulting to the earliest date.
Withdrawal Strategy
The plan for how much to draw from your accounts each year, and which accounts to draw from first, so your savings last and your tax bill stays as efficient as possible. The order of withdrawals can matter as much as the amount.
03
Risk & Protection
Risk Tolerance
How much investment ups and downs you can accept, both financially and emotionally, without abandoning your plan at the wrong moment. It tends to shift as you move from building wealth to living on it.
Diversification
Spreading your money across different types of holdings so no single one determines your outcome. It does not remove risk, but it can reduce how much any one event affects your overall plan.
Inflation Risk
The gradual loss of purchasing power over time. A dollar today buys more than a dollar will in twenty years, so a retirement plan generally has to account for rising costs rather than assuming today's expenses stay flat.
Long-Term Care Planning
Preparing for the possibility that you may need extended help with daily living later in life, care that traditional health insurance and Medicare largely do not cover. Planning ahead is about protecting both your savings and your family from an unexpected burden.
04
Tax & Accounts
Tax-Deferred vs. Tax-Free
Tax-deferred accounts (like a traditional IRA or 401(k)) let your money grow without being taxed until you withdraw it, when it is taxed as income. Tax-free accounts (like a Roth) are funded with money already taxed, so qualified withdrawals later are not taxed again. Having both can give you flexibility to manage your tax bill year by year in retirement.
Note
Tax rules are specific to your situation. A glossary explains the concept; a qualified tax professional should guide your actual decisions.
Required Minimum Distribution (RMD)
The amount the IRS requires you to begin withdrawing from most tax-deferred retirement accounts once you reach a certain age. Missing an RMD can trigger a significant penalty, so it is something to plan around rather than react to.
Roth Conversion
Moving money from a tax-deferred account into a Roth account, paying tax on the amount now in exchange for tax-free qualified withdrawals later. Whether it makes sense depends heavily on your tax situation and timing, a conversation worth having with both your advisor and a tax professional.
Probate
The legal process of settling a person's estate after they pass. It can be time-consuming and public, which is why estate and legacy planning often focuses on structuring assets so they can pass efficiently and privately to the people you intend.
05
The 7 Key Areas
The Marshall Plan examines seven key financial planning components together, because a strong retirement plan depends on how the pieces fit, not any single one alone.
Estate & Legacy Planning
Arranging how your assets pass to the people and causes you care about, ideally in a way that is efficient, clear, and spares your family avoidable stress and cost. It helps secure a comfortable future and preserve what you have built for the next generation.
Building financial security and confidence for your later years through a comprehensive, personalized approach, so you can pursue your retirement goals without wondering whether your income will hold up.
Coordinating your income and withdrawals to help minimize tax liabilities and improve overall financial efficiency, so more of what you have earned stays with you.
Building and managing a customized portfolio aligned with your goals, with strategic asset allocation matched to your risk tolerance and time horizon, and reviewed as your life changes.
Managing the money moving in and out each month so you have stability today while staying on track toward your longer-term goals. Effective cash flow planning is the foundation the rest of a plan rests on.
Safeguarding your assets and income against events outside your control, so an unexpected setback does not derail the rest of your plan. Insurance and risk management are pillars of a resilient financial plan.
Preparing for the future of the people who depend on you, with customized solutions designed to protect your family's long-term financial well-being for generations to come.
The best financial decisions start with a conversation, not a definition. If any of these terms touch on something you're weighing, we're glad to talk it through, and we love to listen.
