Where should you pull money from first in retirement? Here's the standard order all retired Americans should consider

Confused? It's understandable.

Everyone's retirement situation differs and there's no paint-by-numbers guide to pulling money in a foolproof sequence. Rather, a clear-eyed assessment of your situation — best done in conjunction with a financial professional — can help you make sense of where to start.

The good news is that certain rules of thumb apply to most retirees. This roadmap offers suggestions for drawing from the right sources at the right time, in the right order.

1. Cash

Cash is king for those who hope to kick off the golden years in royal style. If you've built cash reserves that surpass your emergency fund, start your withdrawals there.

For starters, cash doesn't work for you the way investments do. In fact, it loses value in direct proportion to inflation. The effects may startle you, as $2,000 in the year 2000 could purchase $3,600 worth of goods today if the money kept pace with the cost of living. But is cash sitting in a shoebox or a zero-interest checking account? It would still be worth $2,000 today.

The good news is that you can grow your cash, even in retirement, with certificates of deposit (CDs) that offer high rates of return in exchange for securing your investment with the bank for a fixed term.

SavingsAccounts.com is an online platform that simplifies finding the top certificate of deposit options.

Their easy-to-use comparison tool provides real-time data on rates and terms from various banks. With tailored recommendations and clear details on fees, it saves time and helps users make informed decisions on low-risk, high-return investments.

If you want to compare your saving options, check out the Moneywise best high-yield savings accounts of 2025 that can earn you more than the national average of 0.4% APY on savings accounts.

2. Taxable accounts

The next place you should look for withdrawals is your taxable accounts. The logic is that taxable brokerage accounts are the least tax-efficient because they’re subject to capital gains and dividend taxes.

However, when buying and selling stocks, it’s important to remember how strategic losses can help you offset your gains, thereby maximizing your overall returns through tax savings.

You can ensure you’re making the right choices by working with a financial advisor in retirement to ensure your plan for withdrawals gives you the most bang for your buck. Research from Vanguard shows that investors who consult financial advisors can see up to a 3% increase in net returns compared to those who plan for their retirement alone.

Finding a financial advisor that suits your specific needs and financial goals is simple with Vanguard.

Vanguard’s hybrid advisory system combines advice from professional advisers and automated portfolio management to make sure your investments are working to achieve your financial goals.

With a minimum portfolio size of $50,000, this service is best for clients who already have a nest egg built and would like to try to grow their wealth with a variety of different investments. All you have to do is set up a consultation with a Vanguard advisor, and they will help you set a tailored plan and stick to it.

3. Collectibles

With art and vintage items, the appeal is obvious.

After all, which is more fun? Owning 1,500 shares of General Motors, (worth about $68,000) or snagging a GM throwback like a 1960 Chevy Corvette that currently fetches an average of $69,200?

As for whether a collectible-based strategy is a reliable income stream in retirement, there’s no way to know definitively.

In all, 83% of wealthy young Americans ages 21 to 43 own or are interested in an art collection compared to 40% of the wealthy overall. They’re investing in “blue chip art,” said Drew Watson, Bank of America’s Head of Art Services, in a Bloomberg interview.

“The fastest-growing segment of the art market is still post-World War II and contemporary art”, Watson added.

Many Americans collect art but what if you could invest in blue-chip artworks to give you a passive income source you can draw from in retirement instead of selling your family heirlooms or personal collections?

One of the firms looking to increase access to art is Masterworks. Instead of spending millions on a single painting at auction, investors can now purchase fractional shares of blue-chip paintings by renowned artists including Pablo Picasso, Jean-Michel Basquiat, and Banksy.

You can browse Masterworks’ impressive portfolio, choose how many shares you’d like to buy, and once the firm sells the piece you’re invested in, you’ll get a return from the net proceeds — and Masterworks has already sold roughly $45 million worth of art to date.

Masterworks investors have realized representative annualized net returns like +17.6%, +17.8%, and +21.5%* (among assets held for longer than one year).

Since launching in 2019, they have exited 23 of their paintings, all at a profit. Just like any investment, art takes patience, and you need a relatively long-term horizon to see meaningful returns.