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By Dan Kadlec
October 6, 2016

If only you could see your future self, you’d likely change all kinds of things you are doing today, starting with how you eat and how often you exercise. You’d probably change your spending and saving patterns too, research shows.

The simple act of envisioning what your life will look like in, say, 20 years is a powerful motivator. No one likes to think about growing old, so they don’t. Yet priorities clearly shift as you age, and thinking about them now can make the change less stressful.

Running out of money is top of mind for most new retirees, even those with a high net worth, according to a new survey of financial planners who are CPAs, conducted by the American Institute of CPAs. But a decade into retirement, the top concern shifts to health, including dementia and diminished cognitive ability to manage one’s affairs, the survey found.

Imagine if at age 35 you had looked in the mirror and seen your face at 65. Plenty of research suggests you would have saved more. Likewise, at age 65 had you looked in the mirror and seen your face at 75 or 80 odds are pretty good that you would have set up financial safeguards like powers of attorney, appropriate housing, estate matters, and elder care—well before you worried about your capacity for doing so.

The shift in priorities is acute. During the first ten years of retirement, 52% of CPA planners say their clients’ biggest fear is a sharp decline in the value of their investments; 24% say the biggest worry is serious illness, including dementia. But after 10 years, 44% of CPA planners say dementia is the top concern, while 28% say the biggest fear is a sharp decline in investments.

To ease those early-in-retirement worries about running out of money, some planners advise a counter-intuitive strategy of lightening up on stocks in your 60s and letting your stock exposure grow from there. The thinking is that early in retirement is when you are most vulnerable to a sharp market downturn. Most of your savings may be at risk and you may not have time to wait for a market rebound without selling at least some of your stocks.

A “rising equity glide path” in retirement can produce superior results to one where you start with more stocks and slowly ratchet down, according to research from financial specialists Michael Kitces and Wade Pfau. In a new post on his Nerd’s Eye View blog, Kitces suggests people build their bond exposure as they approach retirement and then spend down that bond reserve in the first half of retirement.

Meanwhile, just 18% of planners’ clients are taking steps now to prepare for cognitive decline, according to the AICPA survey. But half of all planners say at least one client in the past year exhibited signs of dementia for the first time. Those clients probably wish they had envisioned this day a long time ago.