1. Guardrails as Retirement Withdrawal Strategies
Definition: Guardrail withdrawal strategies are a way of managing client income in retirement. Spending is adjusted up or down depending on how investments perform, keeping the client “on track” without requiring constant recalculation.
Example:
If the portfolio grows significantly, the client’s withdrawals may be increased (raise the income “ceiling”).
If the portfolio declines beyond a certain point, withdrawals may be reduced (protecting the plan from depletion).
In Practice:
This approach reassures clients by showing a safety system that keeps their retirement plan sustainable.
2. Guardrails in Voyant
While Voyant doesn’t currently have a “guardrail withdrawal” button or module, you can model similar strategies by:
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Creating Spending Rules: Adjust income goals based on market performance using manual scenarios
Tip: Many advisers create two or more scenarios or "What If Plans" (e.g., “Base plan,” “Above Average Market Performance or Increased Spending,” “Below Average Market Performance or Decreased Spending”) and show clients how adjusting spending in response to markets can extend a plan's longevity.
Running Stress Tests: Model market downturns, Loss Capacity, Monte Carlo's to see how much spending flexibility is needed.
Tip 1: Use the Retirement Spending Insight to Set Guardrails
The Retirement Spending Insight is a powerful way to help clients understand the boundaries of sustainable spending. Run this Insight in each plan to identify their maximum sustainable spending capacity, a useful ceiling for annual lifestyle expenses.
A simple client-facing script could be:
“We’ll keep your annual lifestyle spending at or below this sustainable figure. If markets do well, we may increase spending. If markets underperform, we’ll step it down.”
This gives clients a clear, rules-based approach while reinforcing that flexibility is the key to long-term sustainability.
From here, you can:
Keep the same expense goal in the plan to test overall feasibility.
Use the Investment Returns Insight to evaluate sensitivity to market performance.
Run the Retirement Spending Insight again to gauge wiggle room in spending, noting that it shows an annual average and does not capture one-off expenses.
This approach creates an upper guardrail for spending specifically from assets under your management.
Tip 2: Focus on Assets Under Advice
By default, the Retirement Spending Insight incorporates all liquid assets and income sources. To isolate the sustainable drawdown rate from only the accounts you directly advise on, create a What If scenario where you:
Include only the accounts under your advice.
Remove other income streams and liquid assets.
This ensures the Insight reflects your specific sphere of influence, giving both you and the client clarity on what’s truly sustainable from the portfolio you manage.
3. Present the story (Let’s See)
Go to Let’s See and use Cash Flow, Assets, and Net Worth to show the differences between plans.
Reference the Retirement Spending results live: “Here’s your max sustainable spending in each scenario and how that translates to your annual budget.”
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Toggle between plans (or use your plan comparison tool if available) to visualize how adjusting spending extends longevity.
4. Set review cadence & checkpoints
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At each review, rerun:
Retirement Spending, Monte Carlo, and Loss Capacity in the Base Plan with the most up-to-date information in the plan.
If a trigger is hit, switch to the appropriate what-if plan and update the client’s spending target accordingly.
Make a note of the decision in Plan Notes for an audit trail.
Other videos you might find helpful
Presenting Advice Using Monte Carlo Simulations
Adjusting Growth Rates in Retirement