Thursday, February 21, 2008

Retirement Planning 101

Half way through a two day retirement planning session with my wife, a couple of highlights have emerged.
  1. There is no answer to "how much do you need?" that exists separately from "what will you do?"
  2. Retirement can be defined as "ceasing work in order to collect the pension." If you don't have a pension to collect, all you have done is quit work, regardless of your age.
  3. These days the biggest fear is outliving the savings, followed by poor quality of life after approx age 85. To overcome the first fear, divide your budget into necessities and fun stuff, and spend none of the capital that is needed to fund the necessities. To overcome the second fear, well, that requires more philosophy than I have the energy for tonight.
  4. Have a real plan. Saying your priorities are "travel" or "family" is not specific enough.
  5. In retirement, feel free to fly first class. Otherwise, your heirs will.

No comments: