Ep 178 - The Hidden Risk of Playing It Too Safe in Retirement
Many retirees believe playing it safe means avoiding market risk—but that fear-driven approach can quietly limit your lifestyle in retirement. In this episode, Joe Curry explains why inflation and longevity are often bigger threats than volatility, and how guaranteed income, smart spending clarity, and the RISA framework can help you retire with confidence.
Key Takeaways
Market risk isn’t the biggest threat in retirement. Inflation and longevity can quietly erode purchasing power and lifestyle if your plan is too conservative.
You actually have two time-horizons in your retirement. Even if you need money short-term, your portfolio may still need to last 20–40 years.
Clarity around spending is essential. Separating necessities from discretionary spending gives you confidence and flexibility in retirement income planning.
Guaranteed income can unlock peace of mind. CPP, OAS, pensions, or annuities can cover core expenses and reduce pressure on your investment portfolio.
The right strategy depends on your mindset. Tools like the Retirement Income Style Assessment (RISA) help align your plan with how you value security, flexibility, and legacy.
Insights Worth Sharing
“Playing it safe can actually be one of the riskiest things you do in retirement.”
“Inflation and longevity don’t make headlines—but they quietly change everything.”
“Confidence in retirement doesn’t come from fear. It comes from clarity.”
“Guaranteed income isn’t about giving up control—it’s about buying peace of mind.”
“The goal isn’t to squeeze every penny forever. It’s to enjoy the life you worked so hard to build.”
The Hidden Risk of Playing It Too Safe in Retirement
When it comes to retirement planning, many Canadians believe that avoiding market risk is the safest move. Holding cash, GICs, or ultra-conservative portfolios can feel comforting—especially after a lifetime of saving. But what if playing it too safe is actually putting your retirement lifestyle at risk?
That’s the hidden danger Joe Curry explores in this episode of Your Retirement Planning Simplified.
The reality is that retirement comes with two time-horizons. Yes, you may need income in the next few years—but you may also need your money to last 20, 30, or even 40 years. When we focus only on short-term volatility, we often ignore much bigger risks: inflation and longevity.
Inflation quietly raises the cost of living year after year. A lifestyle that costs $100,000 today could cost $200,000 in a couple of decades. Longevity risk adds another layer - many retirees will live far longer than expected, especially as medical advances continue to improve health span, not just lifespan.
The foundation of strong retirement income planning starts with clarity around spending. Joe encourages retirees to separate expenses into necessities and discretionary spending. Housing, groceries, utilities, and healthcare need to be covered no matter what. Travel, hobbies, and lifestyle upgrades offer flexibility.
Once that clarity is in place, guaranteed income becomes a powerful tool. CPP, OAS, and defined benefit pensions often cover a significant portion of essential expenses—but many retirees never actually compare those income sources to their true spending needs. When there’s a gap, annuities can be used strategically to fill it, effectively creating a personal pension.
With necessities covered, the rest of your portfolio can be invested with a longer-term mindset—helping address inflation and longevity without constant stress. This is where guardrails-based strategies come into play, allowing for flexibility without requiring constant changes to spending.
Joe also addresses a common question: “Why not just live off dividends and never touch principal?”. While dividends can play a role, relying on them exclusively can reduce diversification and tax efficiency. Retirement income works best when viewed as a total return strategy, not a single tactic.
Ultimately, there’s no one-size-fits-all solution. Some retirees value flexibility and legacy above all else. Others prioritize security and predictability. That’s why Joe uses the Retirement Income Style Assessment (RISA) as a starting point—to ensure each plan aligns with both numbers and mindset.
At the end of the day, retirement isn’t about holding on out of fear. It’s about building confidence through clarity, so you can enjoy the life you worked so hard to create.
Learn more about our retirement planning process at MatthewsAndAssociates.ca.