Averages Don’t Retire—You Do: The Hidden Risk in Planning

You’ve worked a lifetime to save for retirement. But what if retiring at the wrong time mattered more than how much you saved?

Most soon-to-be retirees glance at their financial plan and feel reassured. After all, the market has averaged 7%–10% a year—what could go wrong? The answer: plenty. Because averages can be dangerously misleading.

The truth is, retirees don’t live in averages—they live through sequences. And if your first few years of retirement collide with a downturn, your future could look nothing like what the spreadsheet promised.

What Is Sequence of Return Risk?

This is called sequence of return risk—and it’s one of the most overlooked dangers for retirees, especially those considering retiring near market highs.

Sequence of return risk is the danger that bad returns early in retirement have an outsized impact on your long-term wealth. While workers can benefit from buying cheap in a downturn, you’ll be doing the opposite—selling to fund withdrawals. That means locking in losses and shrinking your ability to recover when markets rebound.

source: JP Morgan

Why This Should Worry Today’s Retirees

If you’re planning to retire now, with markets at record highs, ask yourself: What if your first five years look like the Tech Bubble of 2000–2002… instead of the boom of 1995–1999?

Here’s the unsettling truth: most financial plans ignore this risk. They assume neat averages and simply hope the timing works out. But real retirees don’t live in averages—they live through sequences.

What You Can Do

At Sevey Wealth, we believe retirement planning should be rooted in realism—not averages. That means stress-testing your plan against history’s toughest markets, not just rosy projections. Because your retirement deserves more than hope.

There are ways to reduce sequence of return risk, but they aren’t one-size-fits-all—and they aren’t usually offered by product-driven advisors. At Sevey Wealth, we’ve built strategies designed specifically for retirees who want to safeguard their income and lifestyle, no matter what markets do in those early years.

The Bottom Line & How to Move Forward

We believe sequence of return risk is the hidden variable that can make or break retirement. Two retirees with the same savings, withdrawal plan, and average returns can end up in very different places—depending only on when they retire.

If you’re approaching retirement, don’t bet your future on averages.

👉 Book a call with us today. Let us show you how your retirement plan holds up against history’s toughest markets—and how we can help you reduce the risks that most advisors don’t even talk about.