If you plan to retire well before 70 and have built up a healthy balance in your retirement plan or IRA, here’s a financial strategy to consider. It can reduce tax and provide financial protection in case you live into your 90s or beyond.

Step 1: Assuming you have some savings outside your retirement accounts, defer taking Social Security until age 70 and use your savings for living expenses. Every year of deferral earns you 8% more on your monthly Social Security check. So, for someone with a “normal retirement age” of 67, your annual Social Security check from age 70 would be 24% higher. That larger check protects against exhausting savings later in life.

Step 2: Assuming you don’t have a large pension coming in – or other income like a spouse’s employment – take out portions of your IRA or 401(k) annually in your 60s. If you need the money, it covers expenses. If you don’t, reinvest it. Why? You are moving forward some of the tax you will have to pay on your IRA or 401(k) distributions into years when you’re in a lower tax bracket. If, for example, you and your spouse have $1 mm in a 401(k) and two Social Security checks, you could be over $100,000 in taxable income in your 70s. Better to take some of that 401(k) or IRA balance out in your 60s if you’re retired and have little other income. The best place to invest that distributed 401(k) is in a Roth IRA, eliminating any future tax.

Step 3: Relax.