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There isn't one "best" retirement income strategy. The right strategy depends on where your money is, how it's taxed, and what you're trying to accomplish.

One mistake I see people make is focusing only on investment returns. Retirement income is really about cash flow and taxes. You may have money in IRAs, Roth accounts, brokerage accounts, pensions, and Social Security. The question isn't simply, "Where do I take money from?" It's, "How do I create income while paying as little in taxes as legally possible?"

A well-designed retirement income strategy coordinates your investments, taxes, and withdrawal plan so they all work together. Before you start taking withdrawals, it's worth taking a step back and building a plan first.

I hear this question all the time, and the answer usually surprises people.

There isn't one withdrawal order that works for everyone.

Many people have heard to spend taxable accounts first, then tax-deferred accounts, and save Roth accounts for last. Sometimes that's the right answer. Sometimes it's exactly the wrong answer.

What matters is your tax picture—not just this year, but over the next 20 or 30 years. A withdrawal that saves taxes today could create a much larger tax bill later through higher Required Minimum Distributions, Medicare premiums, or taxes on Social Security.

Before taking distributions, it's important to look at the entire retirement picture. That's where the real planning happens.

A Roth conversion can be one of the most valuable tax planning opportunities in retirement—but only when it's done intentionally.

The goal isn't to avoid taxes. The goal is to pay taxes at the lowest rate possible.

For some families, converting a portion of an IRA before Required Minimum Distributions begin can reduce lifetime taxes and leave more flexibility later in retirement. For others, converting too much in one year can push them into a higher tax bracket or increase Medicare premiums.

The question isn't whether a Roth conversion is good or bad. The question is whether it makes sense for your specific tax situation this year.

One of the biggest misconceptions I hear is, "I already paid taxes into Social Security, so my benefits are tax-free."

Unfortunately, that's not always the case.

Depending on your total income in retirement, up to 85% of your Social Security benefits may be subject to federal income tax. Notice I said subject to tax—that doesn't mean 85% of your benefit is lost to taxes. It simply means up to 85% may be included when calculating your taxable income.

That's why coordinating Social Security with IRA withdrawals, Roth conversions, and other income sources is so important. Small planning decisions can sometimes have a meaningful impact on your overall tax bill.

Sequence of returns risk sounds complicated, but the concept is actually pretty simple.

Imagine two retirees with the exact same investments earning the exact same average return over twenty years. One retires just before a market decline, while the other retires after the market has already recovered.

Even though the average return is identical, the person who experiences negative returns early in retirement may end up with significantly less money because they're withdrawing from the portfolio while it's down.

That's why retirement planning isn't just about earning a good return. It's about creating a strategy that helps manage market volatility while still providing the income you need throughout retirement.

One of the advantages of retiring in Illinois is that most qualified retirement income is not subject to Illinois state income tax.

That generally includes distributions from IRAs, 401(k)s, pensions, and Social Security benefits, assuming they qualify under Illinois law.

That doesn't mean retirement income is tax-free. Federal income taxes may still apply, and your withdrawal strategy can have a significant impact on how much you pay over your lifetime.

Just because Illinois doesn't tax certain retirement income doesn't mean you should ignore tax planning. In many cases, federal taxes will have a much greater impact on your retirement than state taxes ever will.