Your Strategy for Managing Risk

Risk is unavoidable. 

Right now, every single executive at Google is working on one problem: 

What happens when “Googling” for answers becomes a thing of the past? 

Think about it. Google’s entire business model for nearly 25 years has revolved around people searching for answers. It became such a big thing that the Oxford English Dictionary added the term to its dictionary in 2006. If you start a business that becomes so useful to people that your product name is entered into dictionaries, congratulations. 

Google makes billions of dollars every single day because you and I ask questions and look things up. But now, we’re increasingly skipping the search bar altogether and asking an AI-powered chatbot instead. 

Google is facing an existential risk, and they’re not shying away from it. They’re actively cannibalizing their core business to pivot toward a future they can’t yet fully see or understand—the post-search internet. 

Don’t believe me, next time you open Google type @gemini in the URL bar.

It’s bold. But they had no choice. 

That’s exactly what retirement feels like. 

No matter how successful you've been—whether building a business or career—there comes a day when your steady paycheck stops. When you, your body, or someone else says it's over. When that happens, you're forced to pivot into something completely new, shifting from earning income at a job to managing and stewarding your own resources. And when the predictable earnings stream from working stops, the risk in your financial life skyrockets. 

I talk about risk every day with clients and readers. Almost every conversation eventually circles back to this single issue. Beneath all the complexities, the concern always boils down to one simple yet powerful question: 

Will I be able to do what I want to do, no matter what happens? 

You spent the first 20 years of life learning how to earn, then 40 years earning, and now you want to spend the last 20 to 30 years doing things on your own terms. Standing in front of that dream is risk. 

Risk is the chance you won’t be able to do something you want to do. 

Right now, you can probably recall multiple moments when you've encountered risk head-on. Maybe it was a downturn in your business, a health issue, market crashes, or even how you place a sharp knife in the sink after using it. Risk is everywhere, and we think about it all the time. 

But the most dangerous risks as you approach retirement are the ones you don’t even know about—the unknown unknowns. 

The LIVE WELL Risk Framework

To have a successful retirement, I’ve found it extremely helpful to write down and think through as many risks as possible that you could face in the second half of life so you can manage them through investing and financial planning. 

Here is the framework we use to help families identify, discuss, and ultimately solve these risks as they head into retirement. I call it LIVE WELL: 

L – Longevity Risk. You may live significantly longer than expected, stretching your savings thinner than anticipated. For families across the wealth spectrum, adding even a decade or more of unplanned years requires serious adjustments in strategy. 

I – Inflation Risk. Inflation silently reduces purchasing power, especially concerning essentials like healthcare, housing, and day-to-day living. High-net-worth individuals often underestimate how significantly their lifestyle can be impacted over a long retirement. 

V – Volatility Risk. Market ups and downs, particularly at the onset of retirement, can dramatically impact your portfolio’s longevity. Don’t underestimate this one, particularly given how narrow the market’s gains have been in the last decade. A significant market drop early in retirement can derail anyone. Several executives at my previous firm had to work longer because of the 2008 financial crisis. 

E – Estate & End-of-Life Risk. Without thoughtful estate planning, your hard-earned wealth might not reach those you intend, in the way you want. Poor planning can lead to unintended consequences, tax burdens, or family disputes. This is the #1 concern of new readers coming into the tmrw community. 

W – Withdrawal Risk (Sequence of Returns). Withdrawing from your portfolio at the wrong times, especially during a market downturn, can significantly impact your financial health and portfolio lifespan. I liken this risk to shooting extra holes in an already sinking boat. Recent retirees who retired at the end of 2021 faced an awful start to retirement with the downturn in 2022. 

E – Emergency & Liquidity Risk. A lack of accessible cash can force you to liquidate assets under unfavorable conditions. Poor liquidity planning can also compound into tax problems. 

L – Legislative Risk. As tax codes, retirement rules, and laws surrounding Social Security, Medicare, and estate taxes evolve, they can meaningfully alter your retirement landscape. Being proactive and informed is crucial. This has been particularly acute over the last five or so years. 

L – Long-Term Healthcare Risk. Healthcare and long-term care costs pose one of the greatest financial threats during retirement. These expenses can escalate rapidly, significantly impacting even substantial savings. We’ve had families spend $30k a month in certain scenarios. It’s sad for everyone involved. 

So this is what you should consider doing.

Google created one of the best businesses ever. They organized the internet and brought institutions and people together in a way the world has never seen. Now, that amazing 25-year run is changing fast. 

But Google knew about this existential risk—likely 15 years ago. So what did they do? They still worked to improve their search business, but they also built nine other businesses, each with over a billion users. They built a diversified portfolio so when, not if, AI came for search, they would be ready. It hasn’t been the easiest road, but they're doing it. 

Like Google, your goal isn't to avoid risk altogether but to understand and actively navigate it. 

As you look into your financial future, use this framework to help identify the areas you need to address, giving yourself time and space to build a financial life that can pivot as your body ages, your kids grow up, your career ends, and the world moves on. 

If you'd like help understanding how these risks specifically impact you, we're here and let’s talk. 

Tom