This past week we had our semi-annual check-in with The Financial Folks.
The Financial Folks are someone that came to us some years ago via The Outdoorsman. Even though they have never been in the state we have lived in, they have been solid advisors and performers over the years - so much so that now other members of our immediate family - Na Clann and my mother-in-law - have accounts with them as well.
My not very sophisticated question for them this time was "How likely is retirement in 4 years give or take?"
The answer was "Pretty likely".
That includes a standard set of provisos, of course: assumes working up to then, paying for a bridge for health care (or finding a "fun" job to cover some expenses), no wild purchases after retirement (there goes my Lamborghini plan....), and relatively honest budget numbers that are accurate.
But yes, they replied, given all that it seems pretty likely.
I cannot tell you what a happy moment this was.
Yes, I understand that it is some years away. Yes, I understand that I cannot see the future and a great many things can happen between here and there. Yes, I understand that I control almost none of that.
But still - just to have a feasible goal that can be real instead of the endless routine of getting up without any sense that there is a finish line - that is amazing.
There is still a lot of planning to do between now and then of course, things like "Where do we want to end up finally?" and dialing our spending in more completely and educating myself on health care options (which sounds dry, but it matters) and financial rules about money after retirement and taxes strategies. None of these are subjects I take a great deal of pleasure in.
But having a date to fix my eyes on? That, it seems, is priceless.
I think one of the biggest factors is having your spouse on-the-same-page regarding what retirement looks like. If you both enjoy traveling, for instance, how often will you travel? How many of the trips will be over-seas? Are you both willing to travel during the off-season?
ReplyDeleteAnother big factor is flexibility. If your portfolio takes a hit, are both of you flexible enough to tighten your belts for a few years. Refusing to dial back your cash burn-rate means that you eat deeply into your principal during the lean years and it won't bounce back when things recover. Or, if the lean times last long enough, your savings go into a death-spiral.
One huge benefit of a financial advisor is that both of you hear advice like that and discussions are less likely to degenerate into battles of egos and good advisors rake secret expectations into the open and minimize judgment.
ERJ, being on a same page is a huge thing. Part of that we have already "figured in" to what our retirement desires would be (I say "desires"; that is determined by the available income).
DeleteFlexibility worries me - not so much for our ability to flex but the unknown of the coming future. A fair amount of that comes from - frankly - accepting that low budget around the local area is just as engaging as a more glamourous lifestyle. Sadly, I expect things to go worse rather than better in this regard.
Having a good financial advisor (instead of relying on me) has been priceless and worth every penny. It does keep things on an analytical basis
Several excellent points brought up by ERJ, where are you folks going to "settle down" and what are the health care options there? Spending is a biggie TB, watch where the ducats go! Never being a coffee drinker saved me much there and learning to visit stores during the week-days instead of week-ends....a bit less crowded but slower going since more gray hairs who move slower.......:) That goal line is no longer over the hill but in sight.
ReplyDeleteNylon12, Final Location is the one great unknown at this point. We still have a few years to figure it out. The balance seems to be between financial (read "state taxes") and health care/quality of life.
DeleteHonestly, I would love to visit stores during the day. Packing in with everyone else at the end of the day is madness.
I have a countdown on The Computer In My Pocket for total days as well as work days. Having a date makes it real.
I’d like to hear more about this: “… educating myself on health care options (which sounds dry, but it matters)…”
ReplyDeleteAnon - As much as I am reluctant to start down this path, my Former Boss told me of some of her travails as she prepared for retirement earlier this year. I guess the short version is "It is complicated". The longer version is even if I research everything, who knows what will be true in 4-6 years?
DeleteThe two immediate actions I can take now are 1) Take care of myself; and 2) Max out whatever health savings opportunities I have.
If you happen upon a copy, "Bogleheads Guide To Retirement" is about the best book I've found on laying out your spending strategy post retirement and even in the years leading up to retirement. I have a copy that is well worn at this point just in case my spouse decides to retire and join me someday. Also, per recent posts, don't forget to enjoy the now among all your future planning.
ReplyDeleteThanks for the recommendation Ed! Turns out it is readily available at my local used bookstore site.
DeleteI suspect that I will have to increase my reading on this subject in the current year.
And yes, enjoy the now. Although my "now" needs are pretty minimal.
I commend you for planning, TB, and you are very wise to think about your health care options now. it's complicated! We went on Medicare one year ago and chose "Medicare Advantage" because the cost was lower. How did I know one year in, the hospital where most of our docs are affiliated would drop the company that covers our plan? And that this is not uncommon? Now we have to go back to the drawing board and make decisions again. Good advisors are worth his/her weight in gold, too. Our financial advisor hooked us up with a Medicare advisor who is guiding us through it. Happy for you that you see retirement on the horizon!
ReplyDeleteThanks Bob!
DeleteDropping companies is not just for Medicare insurance; many providers do not accept my current insurance provider (lowest paying apparently) and it has been easier at times to just pay out of pocket.
Thanks for the well wishes on retirement. Having a date really helps.
Four years, give or take, is actually not a very long time. I can understand how lovely it must feel to be that close. Hopefully, it will be smooth sailing from here to there.
ReplyDeleteLeigh, it really is not. It also helps put a lot of things in perspective; my time window for "things I really care about" is about that long - as well as people's opinion of me. That may be a freeing things.
DeleteThe next "big step" is figuring out where we want to settle. To be frank, I am going to use this year's tax burden as a conversation driver as I expect it will be a stark difference.