After three decades in the classroom, my mom is officially retiring! She spent her career pouring into the lives of students, working long hours, showing up with care and consistency, and saving diligently into her pension and retirement accounts along the way.
I’ve been her financial planner for the past 10 years, which means I’ve had the unique privilege of walking this road with her — not just as her daughter, but as a professional helping her navigate the financial side of this major life transition.
She did all the hard work. My job has been to help her step confidently into this next chapter with my dad, knowing they're financially prepared for the life they've worked hard to create. For simplicity, I will keep my dad's part of the plan out of the picture.
Here are the key steps we’ve taken — and how you can apply them if you’re retiring (or helping a parent retire) soon:
1. Turning Her Career Savings Into a Retirement Income Plan
What we did:
Mapped out all income sources: Her CalSTRS pension, Social Security (newly relevant due to the passing of the Social Security Fairness Act), and her Traditional 403(b) + Roth 403(b) accounts.
Built a retirement budget: We reviewed her essential and discretionary expenses, home projects, travel plans, taxes, and more.
Created a withdrawal strategy: Since her pension covers most but not all of her fixed expenses, we designed an income distribution plan from her retirement accounts that fills in the gaps in her income while minimizing taxes.
Why this matters:
Many teachers have generous pensions, but may not realize how to coordinate that with other retirement savings to fill in any income gaps. Having a plan for what gets drawn down, when, and how — especially with taxes in mind — is essential to minimizing stress, enjoying retirement, and making sure she doesn't run out of money in as many scenarios as possible.
2. Making Smart Pension Decisions
What we did:
Reviewed her pension payout options carefully: We evaluated the single life benefit vs. joint and survivor options. Although she will be providing a significant amount of retirement income to the household, we chose the higher single life option to maximize her pension. Additionally, her life insurance and both of their retirement accounts will allow my dad to continue to live his life comfortably, even if the household were to lose her income.
Discussed beneficiary planning: Although her pension isn’t inheritable, we made sure other accounts had updated beneficiaries and contingent plans in place.
Why this matters:
Pension elections are permanent and have long-term impacts. It's crucial to look beyond the default option and understand how these choices fit into the bigger retirement picture. This is not a one size fits all decision, by any means!
3. Planning for Taxes and the Legacy She Wants to Leave
What we did:
Ran tax projections for the next 10–15 years to identify opportunities to draw from tax free and tax-deferred accounts in a way that keeps the household in a lower bracket.
Leading up to retirement, we had her saving into the Roth portion of her 403(b)(instead of the pre-tax portion) to reduce future RMD burdens and to diversify her portfolio tax-wise.
Reviewed their estate plan: They have their revocable living trust, will, healthcare directives and powers of attorney to ensure all of their wishes are carried out.
Why this matters:
Thoughtful income planning, tax, and legacy planning help protect your wealth for the long run and give you control over how it supports the people you care about.
Final Thoughts: From Daughter to Planner, This Was Personal
Helping my mom retire was a deeply personal, full-circle moment. I’ve watched her give so much to her work and her community over the years. Helping her make this transition — with confidence, clarity, and joy — is something I’ll always be grateful for.
Whether you're a teacher nearing retirement or the adult child of one, know that the most powerful thing you can do is plan ahead and get the right guidance. Retirement doesn’t have to feel like a leap — with the right steps, it can be a smooth, empowered shift into a well-earned new season of life.
CONGRATS, MAMA!! 💗🤩✨
