Ep # 61- Buyer Beware: If you're paying for a plan, make sure it's a plan
Join us as we address a growing concern: the oversimplification of retirement advice.
We highlight the pitfalls of an overreliance on factors like predicted lifespan and investment returns to plan for retirement. We want you to understand the necessity of considering a wide range of factors, such as the sequence of return risk, healthcare costs, and withdrawal strategies.
We advocate for dynamic and ongoing retirement planning, guiding listeners toward comprehensive retirement strategies and tools.
What You’ll Learn in Today’s Episode
Oversimplification of Retirement Planning Advice: The podcast highlights the issue of oversimplified retirement planning advice found in popular articles on retirement. We want to underscore the importance of a more thorough approach to retirement planning.
Unpredictable Variables: We emphasize the unpredictability of key retirement planning variables, such as investment returns and lifespan. Understanding the limitations of such predictions is crucial in developing a robust retirement plan.
Comprehensive Considerations: Consider a wide range of factors beyond just lifespan and returns, including sequence of return risk, healthcare expenses, and the order of withdrawal from various account.
Dynamic Planning: Instead of relying on one-time calculations, we advocate for dynamic retirement planning. Retirement planning is an ongoing process that requires regular reviews and adjustments to accommodate changing circumstances.
Importance of Dependable Resources: Use valuable and dependable retirement planning tools to help navigate the complexities of retirement planning.
Ideas Worth Sharing
· "Planning is not a one-time event. We can't just plug in some numbers that we don't even know the actual answer to into a calculator to tell us how much we can spend in retirement because it's going to change the next day."
· "There's nothing wrong with getting information from the Internet and looking at different sources, but just don't go to one website and read something and think it's the end all, be all."
· "It's essential for individuals to approach retirement planning with a comprehensive and informed perspective, taking into account various factors and regularly reviewing their plans to ensure they stay on track."
· "I feel like if people are reading that and it's going to make it sound like, well, I could just do this on my own and running those numbers and then they're potentially in for a big shock halfway through their retirement."
Resources in Today’s Episode
Retirement Planning Simplified
Implementing Retirement Income Guardrails to Facilitate (The Right) Spending Raises And Spending Cuts – Michael Kitces
Ep # 6 – YRPS – Retirement Risk # 1 – Sequence of Returns and Why the Game Changes in Retirement
Ep # 7 – YRPS – Retirement Risk # 2 – Longevity
Ep # 8 – YRPS – Retirement Risk # 3 – The Risk of Being Too Conservative
Ep # 9 – YRPS – Retirement Risk # 4 – Inflation Risk
Ep # 10 – YRPS - Retirement Risk # 5 – Healthcare Expenses
Ep # 13 - YRPS – Safe Withdrawal Rates and Traditional Retirement Projections
Ep # 14 – YRPS – Dynamic Withdrawal Strategies
Maximize Your Retirement Potential: The Ongoing Journey to Financial Freedom
Have you heard these retirement planning myths?
Retirement planning is a one-time event. Once you retire, your financial security is guaranteed. You don't need to update your retirement plan as you age.
In this episode, we debunk these myths and share the truth about retirement planning as an ongoing process.
There's nothing wrong with getting information from the Internet and looking at different sources, but don't go to one website and think it's the end all, be all. - Joe Curry
In this episode, Joe expresses concern over an article he read that oversimplified the process of retirement planning. The article suggested that two factors, lifespan and investment return, were all that was needed to calculate retirement income. However, numerous unpredictable elements such as sequence of returns risk, inflation, and healthcare costs affect a retiree's income. Understanding the complexity of the process, it is important to revisit and update retirement plans regularly. This continuous reassessment was the key to a secure retirement.
In this episode, you will be able to:
Probe into the pitfalls of streamlined retirement planning.
Realize the power of knowledge translation in financial planning.
Delve into the multifaceted aspects of retirement planning including healthcare expenses and order of withdrawal.
Appreciate the dynamic nature of retirement planning.
Evaluate the potential risks of depending solely on one source for retirement advice.
Importance of Educating Yourself in Retirement Planning
Ever bought a piece of furniture and ignored the instructions manual? Maybe you nailed the assembly, but admit it, it wasn't an easy task. In much the same spirit, educating yourself about retirement planning can save you a lot of confusion and potential mistakes. Tools like the guardrails concept make it easier to understand retirement planning. Consult with experts to navigate your retirement journey but also take an active part in it by educating yourself. After all, it's your future we're talking about!
Complications in Retirement Planning
Isn't it funny how we live complex lives but hope for simple solutions? Retirement planning is complex, with many aspects to consider. It might seem challenging, but understanding nuances in retirement planning leads to more accurate, personalized solutions for your golden years. Retirement planning isn't a one-size-fits-all scenario. Understanding the mosaic of retirement planning helps us build a secure and rewarding future.
Oversimplified Retirement Planning
In our journey through life, we accumulate a wealth of experience – the signposts that guide our future decisions. The same is true for retirement planning. Yes, tried and true principles exist, but their application varies based on individual circumstances. So, while it might feel comforting to boil planning for retirement down to a few simple metrics, it's crucial to remember that the science of planning is not as straightforward as it might seem. It’s problematic to calculate retirement income based solely on life expectancy and investment returns. In reality, this perspective could create a false sense of comfort. It overlooks additional key factors like healthcare expenses and sequence of return risk.
The resources mentioned in this episode are:
Access the RPS “Retirement Navigator”: Explore our retirement tool that simplifies retirement planning and guides you through the necessary steps to make a sold plan. The tool can help you consider all the factors involved and make informed decisions.
Research multiple sources: When conducting your own retirement planning, don't rely on just one website or article. Make sure to gather information from multiple sources to get a comprehensive view of retirement planning and avoid oversimplifications.
Consider professional advice: If you're feeling overwhelmed or unsure about your retirement planning, it may be beneficial to consult a financial advisor or retirement planner. They can provide personalized guidance and help you navigate the complexities of retirement planning.
Stay tuned for upcoming episodes: The next two episodes will delve into more risks in retirement, providing valuable insights and information to help you better understand and prepare for potential challenges in retirement. Make sure to listen in for valuable advice and strategies.