They imagine it happening in their 80s or 90s–medical bills rising, savings running low, tough decisions near the finish line. So they focus their planning energy on the end of retirement.

But here’s the counterintuitive truth: For many retirees, the most important years aren’t the last 15. They’re the first five.

What happens early in retirement often determines whether the decades that follow feel stable and confident — or stressful and reactive. The reason comes down to one simple concept that sounds technical but affects real lives in very human ways.

Retirement isn’t a moment — it’s a transition

The first five years of retirement are a major transition period.

Income changes.

Spending patterns shift.

Markets continue doing what markets do.

And retirees are learning — often in real time — how to live without a paycheck.

Decisions made during this window tend to “lock in” outcomes, for better or worse. Not because retirees make bad choices, but because early choices have more leverage.

Once momentum is set, it’s hard to reverse.

Sequence of returns risk (without the jargon)

Sequence of returns risk sounds complicated, but the idea is simple.

It’s not just what return you earn over time — it’s when those returns happen.

Imagine two retirees:

• Both retire with the same savings
• Both earn the same average market return over 20 years
• Both withdraw the same amount each year

On paper, they should end up in the same place.

But if one experiences market downturns early — while taking withdrawals — and the other experiences those downturns later, the outcomes can be dramatically different.

Why?

Because early losses combined with withdrawals permanently reduce the amount of money left to recover.

It’s like taking water out of a bucket while holes are forming at the bottom. Even if the water starts flowing again later, the bucket is already smaller.

Why early withdrawals matter more than later ones

In the early years of retirement:

• Portfolios are at their largest
• Withdrawals represent a bigger percentage of future growth
• Market declines do the most damage

A $50,000 withdrawal at age 66 removes not just $50,000 — but decades of potential growth on that money.

Later in retirement, the math changes. There’s less time for compounding to work anyway, so withdrawals don’t carry the same long-term impact.

This is why the early retirement period is often called the fragile phase.

The portfolio is most vulnerable when retirees are:

• New to withdrawals
• Adjusting spending habits
• Emotionally sensitive to market swings

Ironically, this is also when retirees are most likely to rely heavily on investment accounts for income.

The emotional side of early retirement risk

Sequence risk isn’t just mathematical. It’s emotional.

Early market losses can cause retirees to:

• Panic and sell at the wrong time
• Cut spending dramatically — even unnecessarily
• Lose confidence in their plan
• Abandon strategies that would have worked if given time

Once fear enters the picture, decisions tend to compound the problem.

This is why successful retirement planning isn’t just about returns. It’s about behavior under pressure.

Why the last 15 years are often easier than the first 5

This may sound backwards, but many retirees find the later years of retirement more predictable than the early ones.

By then:

• Spending patterns are clearer
• Income sources are established
• Portfolios have adjusted
• Big lifestyle changes are behind them

The early years are when retirees are still figuring things out — how much they actually spend, how markets feel without a paycheck and how comfortable they are drawing income.

That learning curve is exactly why early guardrails matter.

Guardrails retirees can put in place early

The goal in the first five years isn’t to maximize returns. It’s to reduce the impact of bad timing.

Some common guardrails include:

1. Separating income from growth

Not all money needs to do the same job.

When core living expenses are covered by more predictable income sources, investment accounts don’t have to carry the full weight of market volatility.

This allows growth-oriented assets time to recover without forcing withdrawals at the worst moments.

2. Creating a ‘volatility buffer’

Having assets that aren’t directly tied to daily market movement gives retirees flexibility.

Instead of selling investments during downturns, retirees can temporarily draw income from more stable sources — preserving long-term potential.

3. Establishing spending flexibility early

Early retirement is the best time to test spending assumptions.

Building in optional spending categories — travel, hobbies, large discretionary purchases — creates room to adjust without sacrificing essentials if markets stumble.

4. Setting rules before emotions take over

Predefined withdrawal strategies and rebalancing rules help retirees avoid emotional decisions during volatile periods.

Rules created in calm markets tend to be wiser than decisions made during stressful ones.

A short story that explains everything

Two neighbors retire in the same year with similar savings.

One builds a plan that covers essential income from predictable sources and uses investments for long-term growth. When markets dip early, they stay the course.

The other relies heavily on portfolio withdrawals for all income. When markets drop, withdrawals continue, balances fall faster and anxiety sets in.

Ten years later, the difference isn’t intelligence or discipline.

It’s early structure.

The first retiree gave their plan room to breathe in the critical early years. The second unknowingly put pressure on their portfolio when it could least afford it.

Retirement success is front-loaded

This is the key takeaway most retirees never hear: Retirement success is often determined before problems appear.

The first five years quietly shape:

• How long money lasts
• How confident retirees feel spending
• How resilient the plan is to surprises

By the time the last 15 years arrive, most of the heavy lifting has already been done.

Final thought: Play the long game by protecting the short one

Retirement isn’t about predicting markets. It’s about preparing for uncertainty.

When early decisions are made thoughtfully — with guardrails in place — retirement becomes less fragile and more flexible.

The last 15 years matter. Of course they do.

But if you protect the first five, you dramatically improve the odds that the rest of retirement feels less like a risk — and more like the reward it was meant to be.

Lyle Boss, The REAL BOSS Financial, endorsed by Glenn Beck as the premier retirement advisor for Utah and the Mountain West States. Boss Financial, 955 Chambers St. Suite 250, Ogden, UT 84403. Telephone: 801-475-9400. https://www.safemoneylyleboss.com/