Hmm.
On the one hand, you did retire a character, so logically you should get a replacement.
But, you have a character already, so it's not like you'd be kicked out of the game.
But, you did take two characters as an advancement option, it seems kind of mean to take that away from you.
On the other hand, you pretty much lose all your other advancement options when you retire or lose a character, so why should you keep that one?
You could be losing your second character, though, the one you got from the advance.
But do I really want to keep up two sets of rulings depending on which character you retire? No, that's kind of ridiculous.
Final decision: "So, Player, do you want to keep playing two characters, or do you want to go back to just one?"