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Episode #574 - Rocking a Solo Retirement: Nick’s Goals / Laura’s Goals

Roger: The show is a proud member of the Retirement Podcast network.

“There is no way you will experience your best life if you try to operate out of your history or memories of your past.”

-Ed Milet.

Well, hey there. Welcome to the Retirement Answer Man show. This show is dedicated to helping you not just survive retirement but to have the confidence because you're doing the work to really lean in and rock it.

We are on week two of our live case studies with Laura and Nick. Today they are going to talk about the goals that represent their best life and share the base great life and wants and wishes they have for the future.

All right, I have a feeling this is my impression. I would love to hear your feedback as we go through this but I've already recorded these sessions with Laura and Nick. I think this may be the best case study studies that we've ever done. I love the spirit that they're bringing. I love the different approaches and the way that we can hear the, the different perspectives from each of them. So, I just think this is a great one. If you know someone that would benefit from this, share the show with them.

QUICK QUESTION FROM LISTENER BRAD

All right, before we get to Laura and Nick, have a quick question from Brad on retirement planning conferences.

“Hello. I'm curious if you are aware of retirement planning conferences held throughout the U.S. In my career, I often travel to industry conferences where there is a menu of topics to choose from that are presented over a two to three day period. I would love to attend something similar in structure to hear about retirement planning from both industry experts and regular and pre and post retirees.

Unfortunately, Brad it seems most of these types of educational engagements are structured to sell something. Annuities, life insurance, sign up for my wealth management firm, etc. I would appreciate any advice you have on retirement conferences where there are sales pitch free.”

Wow Brad, you hit it right on the head.

Almost all retirement planning education is attached to some other intent. The only one I know of. I mean there are consumers facing conferences that are investment related like the Bogle heads conference is probably the one that comes to mind, which Christine Bent I believe is running this year. Hopefully I'll be able to get to that. The only reason I won’t be able to get to that and so far, why she hasn't come to our conference, the RRC Roundup, is because of the conflict. They're usually around the same date.

I'll be honest here, Brad. The only conference I know of that you get to hear from industry experts, you get to hear from actual retirees pre and post and there is zero hustle or sales pitch involved is the conference that we host for the club every fall. It's a two, three day event. Nobody is selling anything. The cost of the event is nominal if you're a member of the club. I think we charged $80 last year. The club costs $1,000, so it's included in that cost plus the nominal fee. Last year we had over 200 people. In our 6-Shot Saturday email, we will share the agenda that we had for the 2024 roundup. We'll work at improving it, but it's going to be very similar this year. We expect to have over 200 people in Grapevine, Texas in the fall. So, I think that pays for the club just by itself. But you can check that out and we'll share that in our 6-Shot Saturday email, which you can get at rogerwhitney.com with that said, let's move on and hear about Laura and Nick's goals for their best retirement.

LAURA’S GOALS FOR RETIREMENT

Laura, how are you?

Laura: Good. Good. How are you?

Roger: Good. When we stopped talking last time, at least on air, you said it's unusual to talk about yourself. What did you mean by that?

Laura: I think that most people don't reflect on all these questions that you asked in this worksheet that you sent out. I don't think most of us take the time to really figure out who we are and then talk about it out loud.

What's important to us just doesn't happen that often. We're busy, busy. Got to stay busy and productive.

Roger: Yeah, this self-reflective stuff, it doesn't seem productive. If we're doing retirement planning and we need to know the number and whether it's feasible right when we set the goals today, it doesn't seem productive because it's mushy.

One thing I find interesting, Laura, in my experience in working with single people versus married people, is when you're working with a single person, there's less filtering of who they are because they don't have someone sitting next to them. Sometimes if it's a married couple, as an example, one spouse is the spokesperson for the family in some way. Sometimes they both are. But it's hard to get both stories completely out. Not that we've gotten yours out at all, I mean, in our brief time together. But there's no relational dynamic in play, which is refreshing.

Laura: This is unique, interviewing two single people. I was thinking about it and I started thinking, you know what, this is probably less complex than trying to help a couple retire because there's so many more dynamics with a couple, whether the financial dynamics as well as the spending dynamics of each person and their values. I thought, well, this might be easier maybe, in some ways there are.

Roger: In a way similar to what you described, I work in my home by myself. I don't get perspective very easily on my thinking. I'm just in my head. So, like I'm holding up a bottle, people can't see I'm inside the bottle. I can't see the obvious because I'm in my own mental craziness, whereas having a spouse or a partner can observe the obvious, which seems like a miracle observation to you just because you can't see it when you're in your own head. I think from that perspective, yes, you seem pretty self-reflective though. But I think that is the area where it can be a struggle of just that, bouncing ideas off of each other. Especially when it comes to finance. Should I move here or should I not? Should I call my sister? Should I not? Those type of things. You don't have that partner to help game these types of things.

Laura: Yes, to check you sometimes.

Roger: Yeah, yeah. Or push you or pull you back.

Laura: Yes.

Roger: Nobody to call you out or vice versa. I think the other area where it can get a little bit more complicated, which we'll talk about in our last chat before our live event, is how to pre plan for you when you're your mother's age, who's 87.

Given that you don't have a spouse as of now, you don't have children, I guess you have some siblings. I don't know if they're brothers or sisters and where you're at in that pecking order, but they're going to be old too, so they may be able to help, but they might not be able to.

Laura: Yes, that's definitely something I've become more aware of that I need to be aware of to continue to learn on what the next step would be. But I just need to retire first.

Roger: Yeah, yeah, first things first.

Laura: Yes.

Roger: So, can we talk about your mom for a second before we get to your goals?

Laura: Okay, yeah, absolutely.

Roger: So, Your mom is 87. You had told me she lives independently or at home.

Laura: Yes.

Roger: She has slight dementia, I think Alzheimer’s. I don't know which one it was.

Laura: Yeah, you know, at 87 you start forgetting things. Yes, I did use the word dementia. She can be forgetful. Yes.

Roger: I think that's probably normal.

Laura: Yeah, I think it is. That's what I tell her. It's okay, mom. You know, we all forget things.

Roger: You go over there a few times and said last time that you worked out a schedule with your siblings. What type of help does she need now?

Laura: Let’s go back a little bit. I think when she was in her 50s, she saw her mother basically become bedridden and she saw that her oldest sister was basically taking care of her mother 24/7. She came home, her mother was out of the country, she came home and the first thing she did was buy long term care because she saw how terrible that was. I thank her profusely every day for doing that. when I first started taking care of her, we didn't start using the long term care, but we have now. We have someone come from eight to two every day to make sure she has breakfast and lunch and then we go after work to check on her and make sure she has dinner and she goes to bed. We were kind of rotating that around. She needs the care of, making sure she gets her meals, I do her shopping and take everything over and really help her take care of her house as well.

Roger: so, she doesn't have anybody that stays with her. It's just a lot of people who are checking on her and just making sure she's safe.

Laura: Yes.

Roger: Okay. If she had not had long term care, could she afford to live like she is now?

Laura: Absolutely not.

Roger: Okay.

Laura: Yeah, definitely an eye opener.

Roger: Okay. Do you know roughly how much long term care subsidizes her life?

Laura: I know roughly. She has like 300,000 to use.

Roger: Okay. She has a bucket to use.

Laura: Yes, she has a bucket to use.

Roger: Okay.

Laura: So, we're trying to use it wisely because you never know, just like we don't know about ourselves, we don't know how long she'll last. Physically she's pretty good.

Roger: Yeah. She just needs some checking in on.

Laura: Yes.

Roger: So as a result of that, have you secured or are you considering long term care?

Laura: The more you learn, the more you realize how much you don't know and you know how complicated things are. there's a lot of mixed information out there about long-term care and I think a lot of, well, there's a lot of negative about long term care.

So, my thought was my house is paid off fortunately, there's a lot of equity in there. So that was my thought for my long term care. If something happened, whether it be a reverse mortgage or selling the house and going into care facility, I'm not sure if that's the right way to go. But I have not done any research on m actually purchasing long term care.

Roger: Okay, let's table this until our last discussion where we can talk about it. I just wanted to hear a little bit more about your mom.

Laura: We were lucky that she got a little long term care.

Roger: Yeah, it helps out, right?

Laura: Helpful. Yes.

Roger: So, we're going to focus on turning your values into goals that represent you living in congruence with the life that you want to be true to yourself, to have that integrity that you talked about. The most important. This is a hierarchy. So, we want to make sure we focus on the essentials first and then add on the rest. Essentials in retirement planning terms are what I call base great life

Laura: Okay.

Roger: That is obviously paying for all the utilities and the groceries and the insurance that you have to pay. Just the friction of keeping your household moving but also feeling comfortable to go eat out a couple times a week and to do some light travel periodically. I would include that in that number as well. It's not rice and beans. So, do you have a sense of what that number might be for you?

Laura: I was thinking about probably about 5,000 a month.

Roger: Okay. Then where did that number come from?

Laura: I looked at what I've spent. One of my first jobs, I got paid monthly and I just got in the habit of I put everything on a credit card and I pay it off monthly. So, it does make trying to figure out how much you spend every month a lot easier. I took this cash out and I did this using various forms. For the most part I can pay everything with about 5,000 a month.

Roger: Okay, so that's including health insurance, the 5,000?

Laura: I think so. It might be a little low.

Roger: I don't think it is, especially once you get to Medicare under current scheme. But we'll look at those numbers when we live with everybody on, what estimates are, because you're going to have health care prior to Medicare and then you'll have health care after Medicare. Do you have any health care from work?

Laura: Oh, absolutely, yes.

Roger: I'm sorry, when you're retired.

Laura: When I retire. No.

Roger: Okay.

Laura: No.

Roger: Okay.

Laura: So, I'll put what COBRA will cost me.

Roger: Right, right, you'll have five years if we were able to hit that age of 60, because that's the first goal, which is on your 60th birthday, say take this job and shove it. Respectfully, those exact words.

Laura: It really is a great job and a great company. It just would be nice to just get up on my own time, have a cup of coffee and go get on the bike or something.

Roger: Yeah, yeah. It's the season that's ending.

Laura: Yes, Right.

Roger: Trying to think of the Arthur Brooks book related to that of recognizing when seasons end and new ones are beginning.

Roger: Okay, so $4,000 a month and then, well, then a thousand dollars for healthcare. So, I'm going to split those out. There's logic to that that you'll see when we look at the numbers. That $4,000 a month has a thousand dollars hedge for just stuff.

Laura: Yes.

Roger: Okay.

Laura: Yes.

Roger: Basic travel, just, you know, new lawnmower every now and then, whatever.

Laura: Yeah, that kind of stuff. Exactly.

Roger: Okay. Within that category. What about transportation? Do you own a car?

Laura: I do.

Roger: Okay.

Laura: I own two cars.

Roger: You own two cars?

Laura: I have two. One's a 2003 truck and then I have a 2017 Jeep Grand Cherokee. They're both paid off. I hold my cars for a long time, which I think I wrote on there. I don't buy cars every four years or anything like that. I just hold onto them and take care of them. I know that I'll eventually need to get another car, maybe eventually in five years or ten.

Roger: Okay, yeah, the 03 truck, that's just the coolest thing to have just for utility.

Laura: My nephew's borrowing it right now. You know, it's that extra.

Roger: Then the Grand Cherokee, which is a 17, I had a 15. So similar. Let's assume that at some point you have to replace that. Should we say in five, six years?

Laura: Probably, yes, that'd be good.

Roger: So, 2031. Would you pay cash for that?

Laura: I usually put a big down payment and then just make smaller payments, but I've never lived in a retirement.

Roger: They both work for simplicity. Let's just assume you put cash down on it just for simplicity's sake. We'll put $40,000. It's down the road, but we want to have a placeholder for that.

Laura: Okay.

Roger: One thing I've found, Laura, is when you said you had an 03, I thought you were going to stop there. Because I have a client who had, like, a 2003, and she's 71, and it wasn't a money issue. She's just fine with her car. I kind of scolded her. I said, you need to go and get a new car. Not because she needed a new car. Just because of safety features.

Laura: Oh, yes.

Roger: Just going from my 2015 Grand Cherokee to my Bronco. The safety features were significant.

Laura: Yes.

Roger: So just for that reason. But you have a 17. That's good. What about home improvement or repairs?

Laura: I would think probably in 10 years I might need a new roof.

Roger: Okay.

Laura: I need to paint the house in ten years. Probably, within five.

Roger: Okay.

Laura: Was hoping to do that sooner. Yeah.

Roger: What's a good guess on what it would cost to paint a house?

Laura: I don't know. I'm not painting the whole house. I just need to paint the trim because the house is stucco.

Roger: Five thousand?

Laura: I'm thinking five for trim.

Roger: I have no idea. I think a guess is okay here. Then a new roof, you Californians are pretty expensive. I don't know.

Laura: I was thinking about 20,000.

Roger: Okay, we'll put 20. Nothing else that you need or want to be able to do to the house? What's the last major repair you had that was unexpected

Laura: Unexpected? I haven't really had anything. I mean, you have the main thing that gets backed up or something because of the roots going in, but I haven't had anything major happen to the house. I guess you could say it happened 25 years ago when there was a little mini flood in the house.

Roger: Okay. Knock on wood now.

Laura: Exactly.

Roger: No, I'm serious. Knock on wood. I don't want to jinx you.

Then you had put down care for your mom, which I'm assuming is a base need you're going to do that, how much do you currently subsidize helping your mom?

Laura: Oh, just a couple of hundred bucks a month really at this point. I don't know if that's going to change, but.

Roger: Okay. I will put down like 4,000 a year.

Laura: Okay.

Roger: I think that's what you wrote down. The weird question, how long do you think you might need to do that?

Laura: That is an unknown. It is an unknown.

Roger: Okay. You wrote down 10 years, so that'd be 97.

Laura: I know, that was a little high, right?

Roger: I don't know.

Laura: Is it, you know, five years.

Roger: Okay, we'll do that. Then if her condition deteriorates, does she have a home that she owns that she has equity in? Would that help? Or do you think this could ramp up?

Laura: She does own her townhome outright, so she could sell it or do a reverse mortgage on it if needed.

Roger: Okay. You forgot the new floors you wrote down, by the way.

Laura: Oh yeah, I do want to put it on new floors. Thanks for the reminder.

Roger: That's why we complete these. you had $8,000 next year.

Laura: Okay. Yes.

Roger: Okay. I want to make sure we catch that.

Laura: Not a need, but a want. Right.

Roger: Well, I think it's not a bad idea to nest prior to retirement. if you need a new bicycle, if you just need to refresh things, do it while you're working is not necessarily a bad idea.

Laura: Right. No, I agree.

Roger: Now you had also put down dental expenses. Is there something extraordinary there going on? Are you just being.

Laura: I just love to pay for room additions for my dentist’s house. For some reason I always have a crown or something that needs to get fixed.

Roger: You and my wife. You and my wife.

Laura: Oh my gosh. I don't know why I want to supplement his income, but I do.

Roger: Okay, I'll put that one down. Okay, so here's what we have so far. We have about $4,000 a month plus healthcare on top of that, just for base living. We have these home improvements of you know, a new roof, painting the trim, new floor. We have about 4,000 a year for your mom for about five years and random dental, home improvements.

Anything else within a base life that you want to make sure never gets compromised?

Laura: No, I mean periodically travel, I think. I don't even know what that necessarily looks like, but I think I'd want to go to Hawaii or Europe.

Roger: So, we have like a $1,000 hedge in your base grade life, which is 12,000 a year. If you don't have any extraordinary things, you could be traveling.

Laura: That's true.

Roger: But let's talk about travel. So, travel in your best scenario. If we're talking about a discretionary expense, what would you estimate a travel budget would be on an annual basis?

Laura: Maybe 5,000. Maybe. I'm not a big. I am looking for deals.

Roger: Yeah. When you're. When you have time, you can do that too, Right?

Laura: Exactly.

Roger: Are you a road trip lady or a first class lady or what are you. Probably.

Laura: Road trip, yeah.

Roger: Okay, so travel for $5,000 a year. Let's just assume that's for 15 years, at least until you're 75. Would that include the periodic Hawaii or Greece? You've mentioned some of these places.

Laura: Yes, that would include it. So, you know, maybe one year I don't do the local stuff, and then year two, I would maybe do Greece, but I think that would include it.

Roger: Okay. You think that would include it. Okay.

Laura: Yeah. I don't think I had anything else written down, did I?

Roger: No, but what, did you. Did you self-edit anything out?

Laura: I don't think so.

Roger: Okay. I'm not pushing for more, just for more sake.

Laura: Yes.

Roger: I do like to have the first version be anything that you might be interested in so we can get it all on the table and not examine it, knowing that these things are going to change a million times.

Laura: Right.

Roger: So, if you were able to spend 4 grand a month on living plus 5k a year, so that's what, that's 48,000, 53,000. Just on base living.

Laura: Yes. You think that's low?

Roger: You live in California. It sort of seems low for California. I don't know, all the taxes and the, you know. Yeah.

Laura: I put the taxes in their property tax and everything, but I bought my home a long time ago, so my property tax is lower.

Roger: Okay.

Laura: My home is paid off, so that's a big win there.

Roger: That allows you to eat out and just do what you want to do.

Laura: Yes.

Roger: Okay.

Laura: Absolutely. Yeah. I do a home delivery food service already, and that's in my bill.

Roger: There is no judgment on it when I ask. I'm just poking around.

Laura: Absolutely.

Roger: The most important judgment on what works for you is you, right? We always like to compare ourselves to what other people spend. I get that question a lot. It's like, what is average? I'm like, well, I know people that feel really poor, and they spend a couple hundred grand a year. I know people that want for nothing and they spend $53,000 a year. Right.

Laura: Exactly. I, think you interviewed a lady, too, that she was living off of 2,000 a month or something.

Roger: Yeah. I was even like, come on. You're kidding me.

Laura: Yeah.

Roger: She said she had to force herself to spend more because she wasn't even spending that or something. It just depends on where you get your joy from. If you get it from things, then you're going to need more money. But if you just get it from life and getting on your bike and riding or going hiking with your dogs, then that really doesn't cost much. You know, new pair of hiking boots every year or something. I mean, that's not a lot. I have friends that go out to dinner and spend 500 bucks on two people. I'm happy going in and out, and it brings me joy. So, like you said, it just depends. Some people need more and some don't.

One book to consider reading, or you could even just get an article or a synopsis of it, I refer to it a lot, which is The Five Regrets of the Dying, written by Bronnie Ware, I believe her name is. I have the book over here. She was an Australian hospice nurse. These are, I find, very good focusing statements to examine how to minimize regrets like, I wish I hadn't worked so much. I wish I would have allowed myself to be happier. Things like that to identify where there might be a gap. But this works for you. This is a great goal package.

Laura: Yes. Like you said, it works for me. It may not work for everybody. I have friends that are making 10,000 bucks a month in retirement, and they're spending every penny. I'm like, what are you spending it on? Where are you going? Because I couldn't even spend that amount of money if I had it, It just isn't in me.

Roger: So next week, we're going to examine what resources you have to pay for your life. Okay, so now that we have the spending side of the ledger, we need to figure out what we're going to use to pay for this life, assuming you live to a nice old age.

Laura: Okay, it sounds great.

Roger: So, we'll do that next week. Thanks for sharing what your base great life looks like.

Laura: Thank you.

NICK’S GOALS FOR RETIREMENT

Roger: Nick, welcome back!

Nick: Good to be with you, Roger.

Roger: I was getting ready to sing. Oh, Nikki, you're so fine.

I don't know why I don't even think it's Nikki, but that just came to mind.

Today we're going to talk about what Nick wants that is congruent in him living out his values so he can look back at the end of life with minimal regrets as best as we can manage that. Right?

Nick: Sounds good.

Roger: When it comes to finances, on the scale of as long as I have money in the account, I have 30 years of Quicken data. Where are you on that scale of really being aware of the cost of it, you're a data guy.

Nick: I'm a numbers guy. The numbers have always fascinated me, but I've always done it on my own, all of my decision making and everything. I've never engaged with the financial planner or financial advisor or, you know, I've always done my own research, done my own reading, and tried to get myself to retirement that way.

Roger: Yeah, yeah. okay, so you're more on the data guy. I could have guessed that.

So, let's start off with what I like to call base great life, which is outside of health care and light travel and gifting and things like that. What does it cost to live the life of Nick either on an annual basis or a monthly basis or however you think of it.

Nick: So, my feeling is, is that on an annual basis, pretax, I would need about 95,000 a year.

Roger: Okay, so that's a good number. 95,000 for base great life per year.

Nick: Yeah.

Roger: Normally I'll push back when I feel like it is just a guess, I would push back on that because we don't want to guess. You know, it's okay to estimate it, but we don't want to guess. But my guess is your feeling comes from you really knowing numbers. So, it's a little bit more of a valid feeling we'll call it for now.

Nick: Well, I do have a spreadsheet where I don't necessarily capture things down to the lowest level that some people do, but I have a pretty good sense over the last four years of my spending and where it lands.

Roger: Okay.

Nick: I feel pretty good about 95,000. Like I said, pretax.

Roger: Yeah, that's what I wanted.

Now what about health care? So, you're in a government system or scheme. What is your health care cost look like prior to Medicare age and if you're qualified for Medicare. Medicare.

Nick: So of course I have the military retirement, the military health care system to provide me health care, which my premium for that is about $400 a year. I'm mainly able to get my health care through military facilities and the Veterans Affairs Hospital. I don't pay a lot of copays or anything. So that's one of the reasons why I even feel like this is something I could consider. If I was going to have to find a way to pay for regular insurance for the next seven, eight years to 65, I think I would be in a much different position. I think medical, dental, eye care, I probably run just over a hundred dollars a month in premiums. Maybe 125.

Roger: We have Scott on our team who's retired army, who we did an episode with on military healthcare. So, I can come up with some estimates on that and that will continue on. You won't convert to Medicare ever?

Nick: Well, what happens is Medicare becomes the primary payer once you turn 65 and Tricare becomes basically the advantage or the supplement or however you want to talk about it.

Roger: So, will you end up paying for part B?

Nick: I will end up paying for part B, but then my premium for Tricare goes away at that point.

Roger: Okay. Okay.

Nick: Yeah. So, Tricare becomes free to me at 65 and I have to enroll in A and B.

Roger: Okay. We have about 95,000 a year to live the life of Nick, just as a baseline. That's a good life. It's just not extras. Then we have healthcare. What else is a non-negotiable for Nick?

Nick: I think most of the non-negotiables in that 95,000.

Roger: Okay.

Nick: It's the extra things I would like to do that are kind of above that number that I would like to kind of verify that it's possible and doable.

Roger: Okay, well, let's move on to those then.

What are the “sure, would love this, but I'll be okay without it”, what's the first thing that comes to mind?

Nick: So, I would like to have, you know, 20 or 25,000 a year to travel. I love traveling in the shoulder season, which is like October and April. You avoid all the madness of the tourists. You avoid some of the extremes of the weather and oftentimes travel during that time is more reasonably priced.

Also, I would like to be able to take a two to four week trip in this shoulder season on both ends. You know, it's spring and fall and I figured that it would cost me between 20 and $25,000 if I got in an economy seat and just do reasonable tourism. So that would be the first thing.

Roger: Okay. So, you're 57. How long do you foresee Nick doing that? Is this something a 75 year old Nick is going to continue to do?

Nick: Probably, I would say maybe 75 would be the slowing down period, I would think my travel wouldn't be overseas anymore. It might be. You know, there's a lot of the U.S. I haven't seen and I want to front load the long hard trips. The 20 hour flights in the front and in the back end have the ability to just hop in the car and wander across the U.S. yeah.

Roger: So, we'll put 20 grand a year for 17 years. No magic to it as travel.

You mentioned coach. Does that price include a coach seat or a first class seat?

Nick: It's a coach seat.

Roger: Okay, so I put another $10,000 on the worksheet later that reflected, if I had the ability to sit in a business class seat or a first class seat on, those really long trips.

Nick: I haven't been to Australia and New Zealand and I haven't been to a lot of parts of Asia. Those are all really long haul flights.

Roger: Yeah, I remember going to Mongolia. It was 21 hours and I forgot about that trip. It makes a difference, you know, 10 hours, you could argue across the country, just three or four hours. But definitely on those huge trips. Okay, so we'll add another 10 for first class. Now that captures travel for now.

What else?

Nick: I would like to, you know, if I die with nothing on the day I die, I spend my last dollar, I guess I'm okay with that. If it's possible. I would like to leave some pocket change to my nieces and nephews. I've kind of marked that at about $125,000 right now.

Roger: At death.

Nick: Yes. Well, I might do it while I'm alive if it is feasible. But if it put too much pressure on the plan, I would push that to the end of life option.

Roger: Well, that can be. That can. Yeah, that can be something that is navigated more than hardwired in.

Nick: Right.

Roger: Yeah. I don't know if you've read Die With Zero, which talks about the utility of money and giving early versus later. The bequest to the nieces and nephews. It's beautiful. There's so many of them. I don't know if they're still coming.

Nick: Well, no, they're done. The last one is a senior, in high school. However, we've started the next generation after that. I'm already up to three great nieces and nephews. I think it's great.

Roger: I think that's right. Yeah. We just had ours, the children of my nieces and nephews.

You're a great uncle, I think is what it is.

Nick: Right. Yeah. I'm a great uncle now. According to my nieces and nephews, that was true before they started having babies.

Roger: Ah.

Nick: It is kind of sweet how much they indicate they appreciate me. I like it.

Roger: So a strategy here to perhaps save you financially. Don't develop too deep of relationships with these great nieces and nephews, because that's just going to exacerbate the bequest and we're going to have to sacrifice your life and keep you working.

Nick: I think I'll keep it at the top level. In our family there was a point in time where you're giving to everybody at Christmas. All these adults are shopping for each other, trying to buy them things they actually want. Eventually we decided this is just kind of ridiculous. We go to buy what we want when we want it.

Roger: Yeah.

Nick: For the last 15 years or so, it's really been about giving to the nieces and nephews, but we decided that when they turned 18, when they graduated from high school, they graduated out of the gift giving cycle. So, my nephew, who's going to graduate high school this year, got his last Christmas gift from the aunts and uncles.

Roger: Oh, he feels like he gets a raw deal, doesn't he?

Nick: Well, all of us have indicated that we're not going to continue this specific thing with the next generation. We figured that that generation's responsible for the next generation.

Roger: That's funny.

All right, so, so we have, the, the travel. We have the first class. We have gifts either in life or at end to nieces and nephews. What else is on the list?

Nick: I would like to leave some money to some of the charitable organizations that I support too. My charitable giving is included in that 95,000 because I feel that's important. However, I know that if things were tight, I could adjust that around. I don't want to just give money in retirement, I'm going to try to give my time too, but I also want to continue to support some of the organizations.

Roger: Okay, so we have a portion of that baked into the 95,000.

Nick: Right. Then I want to do another 125,000 at death if I can to my charities.

Roger: Okay. What else?

Nick: I'm trying to think about what else I put on there. I guess the only other thing.

Roger: Renovate the kitchen.

Nick: Oh, that's right. Renovate the kitchen. I bought a single family, single level house. However, the kitchen may need an update to be more senior friendly as I get closer to that time. I was thinking maybe, you know, and it's a ballpark, 50,000, maybe 10 years from now.

Roger: Okay, I added that down. I'm looking at your list now. You had a celebration of 5,000 when you retire.

Nick: Yep. That's a onetime celebration cost.

Roger: What is a 5,000 celebration to Nick?

Nick: I'm going to go and find an event planner and tell them to throw a fabulous party for my family and friends to celebrate my retirement.

Roger: Dude, I love that. One of my favorite birthdays was one that I threw and I essentially invited like four couples of people that were meaningful to me. We went to a really nice dinner and then went to a jazz club.

Nick: Oh, that sounds excellent.

Roger: I love that. Throw your own party.

Nick: Yeah.

Roger: I'm looking at your list here. One Thing you put down was, and this is actually a topic that we're going to talk about more in depth in our last session together about aging as a single person is you put down a continuing care community purchase later in life. So how fleshed out is that plan and what was the thinking behind it?

Nick: So, you know, it's just something that's been noodling in the back of my head over, you know, the last couple of years. My parents are still alive. Dad is going to be 90 next year and mom will be 87. Watching your parents age really brings to the forefront of your mind how this is going to work for me? They've had kids who have shown up for them and I'm not going to say that my nieces and nephews won't show up for me, but they're mainly in the upper Midwest and I'm on the east coast and I may not want to go back to the upper Midwest. They have winter there, really hard winter.

Roger: I know how upper you're talking about here and yeah, yeah.

Nick: If my ability to do it all on my own in my own home wasn't doable, maybe I would want to transition to a place where they offer the continuum of care as you move through the what I call the end life stages, you know. It is something I've considered. I do have a long term care plan that I pay for and that's included in my base great life.

Roger: Okay.

Nick: I know that there's some interaction that can happen between long term care insurance and continuum of care communities. But it's something I've considered. It's a rather substantial upfront cost. Many times, you know, I think right now there it can be in this area, the upfront cost can be a quarter of a million dollars. I think I pushed it up to like a half a million, 15 years or 20 years. I don't remember what I put for a date anymore.

Roger: Well, and you think of these upfront costs and we did a series with Kathleen Toomer, I believe her name is off of top of my head, who at the time worked with a continuing care community company in the Northeast. There are a lot of advantages to it. From a cost perspective, I think Nick, and you'll appreciate this as a government budget nerd, it really depends on how you account for the numbers. It might actually be equivalent or less depending on how you look at the different options.

Here is a good example. I was with a friend for lunch the other day. I bought a watch recently and I got a good deal on it. I'm not a watch guy, but it was expensive and I was a little intimidated in telling him. He asked me how much it was and I was intimidated at telling him how much it was. I felt self-conscious about it. But then he showed me it was like, well, I have this. He had the big Apple watch, and I'm like, well, if I look at my watch over the lifespan, it's probably equivalent or less than your Apple watch because you're going to replace that every few years and all that other stuff over and over. So, a continuing care community cost might depend on how you look at the numbers.

Now have you actually explored this or is just this a placeholder concept?

Nick: It's more of a placeholder concept. Even though I'm 57, my friendship circle goes from mid-70s down to late 30s. Several of my friends are having to explore their next steps, it's a topic not just with my parents, but with several of my friends who are kind of reaching the point where they need to look at options with those stairways. Do they go into a continuum of care kind of option or do they find a single level living situation until the next step happens? So, there's been discussions, but it's kind of a placeholder more than anything for me.

I would prefer to stay in my own home as long as I can, of course, and hopefully that'll be doable. I exercise and I take care of myself as well as I can, hoping that, you know, the later years will be easier years because I've done that. But it's really just a placeholder.

Roger: Something to pay attention to and we can explore that a little bit more depth.

One question I didn't ask you was you have a home. Are you planted community wise? Is this where you're going to be?

Nick: Yes, I do plan to stay where I am after moving around for 20, 22 plus years, years in the military.

You don't realize what you miss until you figure out that you are missing it, which is changing every couple of years. You changed the location, you changed the people, you changed your relationships. Everything changed every couple of years. I've been in my community now going on 18 years. I'm coming up on the point where in August next year I will have lived in my community here for as long as the time I spent in my parents’ home before I lifted off. The gap between those two places, I lived in 11 places in 22 years. I found that I really value my friends and my social network and understanding my community. The weather here suits me pretty well as well. It's not too extremely hot and it's not too extremely cold, which I appreciate. I run around in a spring/fall jacket for most of the winter season, so it's about perfect for me. I plan to stay here.

In the beginning, I would say that I wouldn't make any kind of big change unless I was maybe looking at going to the continuum of care. Then I would want to look somewhere closer to family. I don't know, who knows?

Roger: That's why this is all in pencil, right? This is all agile.

Nick: Yeah.

Roger: Last question. Was there anything that you wanted to put on that lifestyle design worksheet that you thought of later?

Nick: Well, this is going to sound really frivolous, I know, but there is one thing I did put on there because it's really an optional activity. I do like to go play some cards or spend some time on a slot machine once in a while, but I know that that's totally above and beyond everything. If I am able to continue to do that on occasion, I have a group of friends where we go and have lunch and we'll play around for a couple hours at the casino. But it's such a frivolous activity and I realize it's just literally mad money. I know that. But if there was a way to allow me to do that once in a while in retirement, I wouldn't mind that either.

Roger: You sound like me talking about my watch. They're like, oh, it's sort of frivolous.

Nick: Except for your watch is a permanent thing.

Roger: It is. But so are those memories with your friends and.

Nick: Oh yeah, yeah.

Roger: Intellectually, I have a client that was a former professional poker player. It is an intellectual strategy exercise. It's a multi-dimensional chess in some ways.

Nick: Oh, right.

Roger: So, if we were to put a budget on that, because with gambling, you should have a budget, what would that budget be?

Nick: Good question. I don't know. Maybe it would be $10,000 a year?

Roger: Okay, we'll do that.

Nick: We normally go a dozen times a year.

Roger: Probably that's once a month. Okay.

Nick: Yeah, it's kind of a Sunday afternoon activity that we do.

Roger: I love it. Okay, so we'll put $10,000, a year as a budget for gamesmanship, we'll call it. We'll rebrand it. We'll rebrand it with strategic training, something like that.

Nick: There you go.

Roger: Okay, so next week what we're going to do, Nick, is talk about just organizing your resources to understand how all of this could be paid for. Then the week after that, we're going to talk about some of the things around continuum of care communities and just aging as single people with less of a social network, from a family perspective.

Nick: Good.

Roger: Okay.

Nick: Yeah, sounds good.

TODAY’S SMART SPRINT SEGMENT

Roger: On your marks, get set, and we're off to set a little baby step we can take in the next seven days to not just rock retirement, but rock life.

All right, in the next seven days, in our 6-Shot Saturday email that we send out every Saturday morning, we're going to change the name of this soon. I'm excited to talk about it, but I have to keep my mouth shut. We are going to share a retirement lifestyle workbook that will help you begin to think about what the base great life you need is. What are some of the aspirational goals that you want to accomplish?

So, grab that PDF, print it out or fill it out and start to think about what it is you want for your retirement that should come from the goals that you worked on last week.

In addition, in that email, we'll share the agenda for the Rock Retirement Club Roundup, our annual conference.

BONUS STORY

Now we will read into the record the latest mission from my grandfather, Zigmund Chancelor, flying in B17s in World War II. We've been doing this since Veterans Day.

All right, we're on mission number 13.

“July 18, 1944. Ship number 183, sortie 9th. Started out for Munich, Germany. Got lost in heavy overcast and were 30 minutes late to the rendezvous. Fault of this person again. Bombed bridge in Corsia, Italy instead. Very bad job. Met no flak or enemy fighters. Simply love this kind. Carried 12500 pound bombs. Mission six and a half hours at 18,000ft.”

Sounds like a pleasant day in the skies with no resistance and found something to bomb and went home.

The opinions voiced in this podcast are for general information only and not intended to provide specific advice or recommendations for any individual. All, performance reference is historical and does not guarantee future results. All indices are unmanaged and cannot be invested in directly. Make sure you consult your legal, tax or financial advisor before making any decisions.