A Step-by-Step Plan to Organize Your Finances and Retire with Purpose

Most people don’t fail at retirement because they didn’t save enough—they fail because their financial plan was never truly organized. I’ve seen it time and again: scattered spreadsheets, a collection of good ideas with no structure, and a lot of anxiety about whether it all “adds up.” That’s why I’ve come to appreciate the Sequoia System—a comprehensive framework designed to turn good intentions into an actual retirement strategy that works.

Let me walk you through what this system looks like in practice. It starts with the most overlooked step:

Step 1: Define Your Vision for Retirement

Before you open a spreadsheet or talk about Roth IRAs, step back and ask yourself what you actually want out of retirement. What relationships, experiences, and accomplishments would make you feel like you truly lived the life you wanted by age 90? This isn’t about the numbers yet—it’s about the legacy and lifestyle that matter to you. The best plans start with life goals, not account balances.

Step 2: Calculate What Retirement Will Cost

This is where we translate lifestyle into dollars. There are two approaches:

• Bottom-up, where you tally your monthly expenses in detail
• Top-down, where you start with your current income and subtract costs that will go away in retirement (like mortgage payments or retirement savings)

In one example, monthly expenses came to $10,000, but after removing savings and housing costs, the number dropped to $7,000. Add back in travel and hobbies, and you’re looking at $9,500 per month. Knowing this number is essential—it sets the stage for every decision that follows.

Step 3: Map Out Retirement Income and Cash Flow

Next, you figure out where the money’s coming from. Maybe it’s Social Security, a pension, rental income, or your investment portfolio. If you need $10,000 per month and Social Security covers $6,000, that leaves a gap of $4,000, or $48,000 per year, which must come from your portfolio. Using a 5% withdrawal rate, you’ll need $1 million saved to cover that.

This is the heart of retirement readiness: understanding whether your assets can produce the income your lifestyle requires.

Step 4: Align Investment Allocation with Income Needs

Your portfolio shouldn’t be a generic mix of stocks and bonds—it should be designed to fund your retirement. In this system, we often recommend setting aside 5 years of stable income in conservative investments (like bonds), with the rest positioned for long-term growth (stocks).

In one case, $250,000 was earmarked to cover early years of income, and the remaining $750,000 was invested in the market. That’s a 75/25 split, tailored not for max returns, but for reliable lifestyle funding.

Step 5: Optimize Taxes After Everything Else Is Set

Now that you’ve built your cash flow and investment strategy, it’s time to make it tax-smart. This includes:

• Roth conversions while your income is lower
• Harvesting capital gains to stay within favorable tax brackets
• Managing income levels to qualify for health insurance subsidies

If done right, these moves can save hundreds of thousands—or even millions—over a multi-decade retirement. But it only works after you’ve got your income and investment plan in place.

Step 6: Review Insurance Coverage

As you near retirement, it’s time to re-evaluate your insurance needs. Life and disability insurance might not be necessary anymore. Instead, focus on:

• Health insurance (COBRA, marketplace, or Medicare)
• Umbrella and liability coverage
• Long-term care planning

Decide whether you want to self-insure or buy policies based on your risk tolerance and health history. This is risk management, not just expense management.

Step 7: Solidify Your Estate Plan

Estate planning isn’t just for the ultra-wealthy—it’s about making sure your assets, wishes, and loved ones are protected. That means:

• Wills, trusts, and healthcare directives
• Strategies to reduce estate taxes if you’re over the exemption limit
• Charitable giving and gifting strategies

It’s not just about what you leave behind—it’s about doing it on your terms.

Step 8: Monitor and Adjust as Life Changes

Finally, your plan isn’t set in stone. Retirement can span 30+ years, and things will change—your health, the market, tax laws, your goals. The Sequoia System is built to adapt, allowing you to track progress, tweak strategies, and stay on course no matter what life throws your way.

What I love most about the Sequoia System is that it starts with life and organizes the money around it—not the other way around. It helps you avoid missed opportunities, emotional mistakes, and disjointed advice. And more importantly, it helps you live a life that’s not just financially secure, but truly fulfilling.

Ready to build your own plan? Start by imagining what would make you proud at age 90. Everything else falls into place from there.

You should always consult a financial, tax, or legal professional familiar about your unique circumstances before making any financial decisions. This material is intended for educational purposes only. Nothing in this material constitutes a solicitation for the sale or purchase of any securities. Any mentioned rates of return are historical or hypothetical in nature and are not a guarantee of future returns.

Past performance does not guarantee future performance. Future returns may be lower or higher. Investments involve risk. Investment values will fluctuate with market conditions, and security positions, when sold, may be worth less or more than their original cost.