Episode 130: Only 1 in 4 Americans Have Done This

Today’s Prep:

Are you doing more summer vacation planning than financial planning? You’re not alone. Let’s talk about how you should view retirement planning in relation to your vacation plans.

(Click the featured times below to jump forward in the episode)

Equipping Points:

As we get into summer, you may be taking trips or starting to plan your vacation. Often, people spend more time planning their vacation than they plan their retirement. Think about when you go on vacation. What kind of planning and preparation do you do ahead of time? David asks co-host Walter about his plans for an upcoming trip. There’s a lot that goes into this!

With a vacation, you have an idea of how long you’ll be there. When it comes to retirement, you still need to estimate how long your retirement might last. When will you retire? What might be your life expectancy? The last thing you want to do is run out of money in retirement and still have five years left.

How much money will you need to spend in retirement? Don’t assume you’ll spend less than you do now! Consider what kind of lifestyle you want in retirement and what that costs. Will you travel? Have you built in healthcare costs? Part of going on a trip is the research and planning and can be an enjoyable part of the process. It defines your goals and builds positive anticipation, just like retirement planning can do. You’ll have more comfort and confidence if you know what your plan is.

Aside from your investments, how much retirement income will you have? If you visit SSA.gov you can get some rough projections at what your Social Security will be. Then put it all together to project what you’ll have, what you need, and what the difference is. It’s important to keep updating your plan and adjusting as needed as you near and enter into retirement.

Listen to the entire episode or skip ahead using the timestamps below.

[0:43] Why vacation planning?

[4:15] – Why does this relate to retirement planning?

[6:34] – The first step is to estimate how long your retirement will last.

[8:39] – The second step is how much you’ll spend.

[12:36] – How much retirement income will you have?

[14:07] – What happens when you put it all together?

[17:12] – Keep updating and adjusting as needed.

Today’s Takeaway:

Part of the hardest work in doing retirement planning is figuring out: what kind of lifestyle do I want—do we want—in retirement?”

– David Dickens

Additional Resources:

PODCAST: Things You Should Never Assume In the Financial World

PODCAST: 4 Steps to Help You Plan Ahead for Taxes in Retirement

PODCAST: 5 Keys to a Strong Financial Foundation

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More From David:

The host: David Dickens

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