# Retirement Habits That Fail in Drawdown > Retirement habits built for growth often break when you stop working. - Title: Retirement Habits That Fail in Drawdown · Kiplinger | Shortify - Summary: Retirement habits built for growth often break when you stop working. Retirement requires new money management habits that differ from accumulation… - Keywords: retirement, drawdown, sequence of returns risk, required minimum distributions, cash buffer, portfolio allocation, Habits, Fail, Kiplinger - Source: Kiplinger — https://kiplinger.com/retirement/retirement-planning/drawdown-phase-catches-new-retirees-by-surprise - Published: 2026-10-25T11:00:00+00:00 - Read time: 1 min - Topics: retirement, drawdown, sequence of returns risk, required minimum distributions, cash buffer, portfolio allocation ## Sequence of returns risk takes center stage Retirement shifts from saving to spending, making the order of market returns critical for avoiding losses. > Two retirees with identical average returns over a 30-year retirement can end up in very different places depending purely on when the bad years arrived ## You move from growth to income and stability Retirement requires reducing aggressive investments to generate steady income without selling at losses. > The balance you held at 45 is rarely the balance that serves you at 65 ## Cash suddenly has a job Holding a year or two of expenses in cash protects against selling investments at depressed prices during market drops. > That buffer is what lets the rest of the portfolio stay invested through a rough patch ## Required minimum distributions start making decisions Starting at age 73, forced withdrawals from tax-deferred accounts increase tax burden and risk Medicare surcharges. > The penalty for missing one is steep: 25% of the amount you failed to take, reduced to 10% if you correct it promptly ## Dollar-cost averaging runs in reverse Retirement reverses dollar-cost averaging by selling shares when prices are low, accelerating portfolio erosion. > Pulling a fixed dollar amount from a falling market chips away at the share count faster than most people expect ## You become a spender Retirees often struggle to spend comfortably, either under-spending due to anxiety or overspending early on. > Becoming a deliberate, comfortable spender, drawing down the money you worked to build without fear or recklessness, is one of the underrated challenges of retirement ## Retirement demands new habits The transition from accumulation to drawdown requires planning and flexibility rather than the same habits that built wealth. > The instincts that built the nest egg, save aggressively, stay heavily invested, ignore short-term noise, don't all translate cleanly to spending it down over decades ## The drawdown phase rewards planning Planning for retirement transitions helps avoid the pitfalls of the drawdown phase and creates smoother financial outcomes. > Knowing the difference, and adjusting before the shift catches you off guard, is most of the battle ## Retirement transition needs preparation The years around retirement require specific planning to handle the shift from accumulation to drawdown. > The years right around your retirement date are when these shifts hit hardest, which is exactly why thinking them through in advance tends to make the whole transition smoother ## Key takeaway Retirement requires new money management habits that differ from accumulation strategies.