Vanguard strategist says retirees need 'a complete mind shift' — and shares 4 principles to ease financial anxiety

Aditi Ganguly

Tue, August 25, 2026 at 6:50 PM GMT+3 12 min read

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From travelling the world to embracing a second act to simply hitting the hammock in your own backyard, everyone has a different retirement fantasy.

But for many, once they've walked away from work, that fantasy gives way to the anxiety-riddled reality of living the rest of their lives without a steady income.

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"Moving from a saving mindset to a spending mindset is really difficult for most people," Garrett Harbron, Head of Advised Wealth Management Strategies at Vanguard, told Moneywise. After decades of diligent saving, he added, watching that bank account balance drop instead of rise can be stress-inducing.

And retirement income anxiety begins long before that final work whistle blows. An April Gallup poll found that 62% of Americans stress that they haven't accumulated enough retirement savings, while 54% worry about maintaining their lifestyle (1).

"This causes some retirees to spend less than they can actually afford in retirement and maybe not live the life they'd really like to," he added. "That's why starting with purpose is so important."

As such, Harbron, who noted the shift in focus requires "a complete mind shift" in an interview with CBS (2), helped outline some strategies for doing just that as the lead researcher for Vanguard's Principles for Retirement Income (3), which offers four key principles for mindful money management — and subsequent stress relief.

The four principles for retirement financial security

From dynamic spending to adhering to the 4% rule, everyone has a different take on how to handle retirement income.

Harbron said Vanguard's four principles "ensure that retirees know what they want their retirement to be, how they will spend their money, have security knowing that their money will last and the time to enjoy their retirement."

Start with purpose

Harbron said this first step is "about setting goals, creating a spending plan, ensuring it's sustainable and thinking about the risks that might knock your plan off track." He called it "the foundation of any successful retirement plan."

Having a target in mind can make that foundation a lot easier to build. Americans estimate they'll need about $1.46 million to retire comfortably, according to Northwestern Mutual's 2026 Planning & Progress Study (4). That's considerably more than the $547,840 average retirement savings balance in the U.S. (5).

That difference may look daunting, but you don't necessarily need to chase the same $1.46 million figure. Your number could be higher or lower depending on your lifestyle, whether you have dependents, where you plan to live, how much you expect to spend on health care and taxes and what other income you'll have coming in.

A professional can help put all of those pieces together. A financial advisor can help you come up with a retirement target that's based on your circumstances rather than a national average and help you build a strategy to achieve your financial goals.

Consulting a financial advisor also comes with another upside — you may be able to see higher returns. A Vanguard study found that those who work with financial advisors see 3% higher returns on average than those who do it alone (6).

For those with over $250,000 in savings, platforms like WiserAdvisor can help you find a vetted FINRA/SEC-registered advisor near you for free.

All you have to do is answer a few simple questions about your savings, retirement timeline and overall investment portfolio. From there, WiserAdvisor will review its network and match you with up to three vetted, reputable advisors aligned to your specific needs.

WiserAdvisor does the heavy lifting when vetting financial advisors on its roster. Each advisor is screened based on their years of experience, their SEC/FINRA registration and records and compensation criteria.

The best part? You can schedule a no-obligation consultation with your matches and see which advisor is the best fit for your long-term goals.

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Cover your essentials

This, Harbron noted, encourages retirees to use income that they won't outlive, like Social Security payments, a pension or an income annuity, to pay for essential expenses like food, housing and medical care. "This makes sure basic needs are covered however long they're in retirement and no matter what happens in the markets."

Social Security can play an important role in that equation, but when you claim your benefits matters. Claiming early can mean locking in a smaller monthly payment for the rest of your life, while delaying benefits can increase your monthly check. But waiting isn't always the right move for everyone.

The key is to look beyond the size of your next check and consider how your claiming decision fits into your broader retirement plan. Your health, expected longevity, marital status, other income and investment portfolio can all affect the decision.

Taking the time to understand your options can help you avoid leaving benefits on the table.

Trusted organizations like AARP provide tools and insights that can help you fine-tune your Social Security strategy so you're not leaving money on the table.

Membership perks also go well beyond advice regarding Social Security. Members gain access to a broad suite of cost-saving perks — from healthcare-related discounts on prescriptions and dental services to savings on travel, leisure and insurance products.

Make your wealth last

This is all about how retirees can make the most of their savings "by reducing lifetime taxes or being flexible with their spending to make their money last as long as their retirement does." The Vanguard study says that this step also includes paying off high-interest debt and unsecured loans to increase wealth and financial flexibility.

Keep an emergency fund

Even a carefully built retirement plan can be thrown off by an expense you didn't see coming. A major home repair, medical bill or car replacement can be especially disruptive once you're no longer receiving a regular paycheck. Without cash set aside, you may have little choice but to put the expense on a credit card or withdraw from your investments during unfavorable market conditions.

An emergency fund can give you some breathing room. Instead of forcing your retirement portfolio to cover every financial curveball, you'll have a separate pool of money designed to handle unforeseen bills.

That buffer can be particularly valuable because unexpected expenses aren't all that unusual in retirement. Research from the Center for Retirement Research at Boston College estimates that retirees face unplanned expenses equal to about 10% of their annual income, on average (7).

Personal finance expert Suze Orman recommends going a step further, suggesting that retirees and people approaching retirement keep enough emergency savings to cover eight months to a year of living expenses (8).

Park it in a high-yield account

A high-yield account like a Wealthfront Cash Account can be a great place to grow your uninvested cash, offering both competitive interest rates and easy access to your money when you need it.

A Wealthfront Cash Account currently offers a base APY of 3.30% through program banks and new clients can get an extra 0.75% boost during their first three months on up to $150,000 for a total variable APY of 4.05%.

That's ten times the national deposit savings rate, according to the FDIC's March report.

Additionally, Wealthfront is offering new clients who enable direct deposit ($1,000/monthly minimum) to their Cash Account and open and fund a new investment account an additional 0.25% APY increase with no expiration date or balance limit, meaning your APY could be as high as 4.30%.

With no minimum balances or account fees, as well as 24/7 withdrawals and free domestic wire transfers, your funds remain accessible at all times. Plus, you get access to up to $8 million FDIC Insurance eligibility through program banks.

Add a safe haven asset

An emergency fund can help protect you from short-term financial shocks, but there's another risk worth considering — what happens when the market falls?

Keeping your entire portfolio in higher-risk investments can leave you particularly vulnerable as you approach retirement. After all, a market downturn is one thing when you're decades away from needing the money. It's another when you're actively withdrawing from your portfolio to pay the bills.

You can't predict when the next correction will arrive, but you can build a portfolio that isn't entirely dependent on stocks continuing to rise. That's where assets that behave differently from the stock market can play a role. Gold, for example, has long been viewed as a potential safe haven during periods of inflation, economic uncertainty and geopolitical turmoil.

Unlike a stock, gold isn't tied to the fortunes of a particular company. And unlike a currency, its supply can't simply be increased by a central bank or government. Those characteristics have helped give the precious metal a reputation as a store of value during turbulent periods.

Opening a gold IRA with the help of Goldco allows you to invest in gold and other precious metals in physical forms while also providing the significant tax advantages of an IRA.

With a minimum purchase of $10,000, Goldco offers free shipping and access to a library of retirement resources. Plus, the company will match up to 10% of qualified purchases in free silver.

If you're curious whether this is the right investment to diversify your portfolio, you can download your free gold and silver information guide today.

Simplify

This is essentially the process of consolidating assets like 401(k)s and IRAs that are in different financial institutions and automating withdrawals or payments "to allow retirees to spend more time doing the things they really want to do."

Lora J. Hoff, a certified financial planner (CFP) and wealth advisor with Wealth Partners Alliance, agreed with the principles but told Moneywise that shifting from saving to spending is a "serious mind shift." And CFP Robert Pagliarini told Moneywise that, in retirement, "nothing prepares you" for the change in mentality that you've adhered to for decades.

It's a pattern that illustrates how adjusting to the proper money mentality in retirement could prove just as important for reducing financial anxiety as getting your accounts in order.

The retirement money mindset

Pagliarini says that shifting the language used in retirement could help offset the mindset shift from a saving to spending mentality.

"Change the verb. Stop saying 'spending.' Start saying 'using,'" he said. "Spending sounds like loss. Using is conversion — into health, into experiences, into people and causes worth backing."

CFP Riley Saunders told Moneywise that "money scripts" — which he defined as "unconscious, multigenerational beliefs about money that are often developed in childhood and deeply influence adult financial behaviors" — can prove positive in the saving phase of life, but work against you in the retirement spending phase.

Retirees, he added, "must consciously recognize these scripts as partial truths and actively 'rescript' them to give themselves psychological permission to use their wealth."

Pagliarini suggested retirees have a custodian move money from their portfolio into their bank account on the first of every month, so it arrives like a paycheck. "The attachment was never to saving," he added. "It was to a predictable number showing up on schedule."

He also suggested retirees "front-load" their retirement with trips or other adventures that their health may not allow for later, calling underspending "the one mistake you can't go back and correct."

And CFP Jamie Bosse told Moneywise that while she agrees with the Vanguard principles, she believes "that flexibility needs to be considered when we are talking about retirement income and spending" — noting it's okay if you spend more during some retirement years than others.

"There's nothing wrong with spending down your retirement savings … You just need to make sure you aren't spending them down too quickly," Harbron said. He added that a financial advisor could help ease some of that stress, "helping you understand what your retirement goals are and giving you the peace of mind that you can afford them."