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Illustration by Pete Ryan

Like many on the cusp of retirement, David Littell felt excited and a little nervous. But the 65-year-old differed from his peers in one key way: He spent the bulk of his career teaching retirement planning to financial advisors.

Littell is a Professor Emeritus at the American College of Financial Services, where he co-created the Retirement Income Certified Professional® designation. In other words, he's a pro at one of the most complex tasks retirees face: turning a lump sum of savings into a reliable income stream that will last for life. And as he approached retirement himself, Littell discovered some key differences between what the textbooks say and the way things play out in real life.

“In financial planning, we tend to think it’s all about the numbers,” says Littell, of Ardmore, Pa. “But I want to own the emotions. The idea that you don’t have a paycheck anymore is rather terrifying.”

He’s addressed this fear in his planning process. Here’s what Littell has learned by finally living what he’s taught all these years:

Start with Something

Financial advisors love to ask their clients detailed questions about their future plans: When are you going to retire? Will you work in retirement? If so, how much?

In reality, “it’s hard to nail that down until you’re close to it,” Littell says. "I've changed my plans four or five times."

For starters, you don’t know how your health will hold up. Some 43% of workers retire earlier than planned, and of those 35% stop working due to a health problem or disability, according to the Employee Benefit Research Institute.

Also, while you’re still working full-time, you’re probably not looking for a part-time job to supplement your retirement income. So you don't know how feasible it is to get the kind of part-time work you want, or how much you might earn once you find it. Alternatively, if you’d rather continue working for your former employer on a part-time or consulting basis, you won’t likely broach the topic with them until you’ve given your notice. All this means that it’s hard to have real numbers to plug into retirement income calculations in advance.

Yet that doesn’t mean you shouldn’t try, Littell says. There’s a good reason advisors ask all these questions, to try to make accurate projections of your retirement income. It’s helpful to know how much you’ll have coming in, to make sure it’s enough to meet your needs. (To ballpark those needs, Littell suggests a simple method: use your most recent paycheck as a proxy for the retirement income you'll need each month -- assuming, of course, that you live within your means and aren't racking up credit card debt to fund your lifestyle.)

So go ahead and make some assumptions, and do your calculations based on those. But understand that estimates are just that, and are subject to change. Revisit your plan regularly, and make sure the numbers are going to work before you give up your full-time gig. "People should think really carefully before they leave full-time work," Littell says. Many people get tired of the grind and let their emotions govern the decision of when to quit, he says. But if you leave the workforce and then regret your decision, it's very hard to re-enter at the same salary with the same benefits.

For his part, Littell recently cut back to working three days a week and plans to further reduce his hours as he shifts to a consulting role early next year.

Listen to Your Gut

Littell’s father lived to age 104. Aware he might have similar longevity, Littell didn’t want to risk outliving his savings. So he bought several annuities, insurance products that turn your lump sum into guaranteed income for life.

Financial advisors commonly recommend that clients use annuities to cover their essential spending. This way, all of your necessary needs will be covered by a "floor" of guaranteed income, and you can use your 401(k) or IRA withdrawals for discretionary fun. The logic behind this strategy is that, if stocks take a dive, you can always curtail your travel plans, but you can't suddenly stop paying your mortgage or your Medicare premiums.

To determine your essential spending, you would tally up what you pay for housing, health care, food and other necessary categories. Then, you calculate how much of the total would be covered by Social Security and any pensions you might have. An annuity or annuities would be used to cover any shortfall.

But Littell didn't go through this exercise. Instead, bought annuities with the percentage of his portfolio that he felt comfortable parting with: about 25% of the total. Many consumers balk at annuities because they reduce your liquidity. Littell was willing to give up control over a quarter of his portfolio in return for guaranteed income, and staying within that comfort zone -- rather than imposing textbook calculations -- helped him execute that strategy. "The intellectual and the reality didn't match very well," he says. "The reality for me was, how much are you willing to give up?"

He's deferring claiming Social Security until age 70, and he estimates that once he reaches that age, about 75% of his essential and discretionary needs will be covered by guaranteed income. The annuities will help him sleep at night and not fret about outliving his savings. “I have no intention of worrying about that,” Littell says.