The Idiots Guide
Sometimes it's about "ADULTING" enough for the day, and other times it's about Keeping a job, Feeding the family, Educating the kids, and Buying the stuff.
Most of us were taught how to read, write, and math good.
But never taught how to file taxes, change a tire, or cook a meal.
How in the world have we survived?
Well, have no fear, the Idiots are here to guide you.
We don't know much more about all the stuff but we might be just a little further down the road than you.
Make no mistake, most of our advice is more like don't try this at home.
Hope it helps!
The Idiots Guide
Retirement Bliss Without the Financial Worries Ep68 TIG
Could you be financially secure enough to enjoy your retirement without worry? Explore the crucial financial decisions you need to make to transform your retirement dreams into reality. We offer insights into building a robust savings portfolio and creating income streams to support your ideal lifestyle. Our conversation challenges the efficacy of some certified financial planners, suggesting they may act more as salespeople than genuine advisors. We also discuss the potential benefits of a long-term planning target of $600,000 to underpin a middle-class lifestyle in your golden years.
Discover how careful planning and prioritization can safeguard your retirement funds from the common pitfalls of excessive spending on hobbies or financially supporting adult children. We discuss the advantages of downsizing and maintaining liquidity for healthcare needs, ensuring you have the flexibility and security to handle future expenses. Transitioning into retirement doesn't have to be abrupt; maintaining part-time work and cultivating fulfilling hobbies like bladesmithing can enhance your retirement experience emotionally and socially. Join us as we map out strategies for sustaining your lifestyle and personal growth throughout retirement, making the most of your financial streams and leisure activities.
Today on the Idiot's Guide. All right, let's talk about retirement, that mythical era, the golden years when you finally get to sleep in, travel the world or just hang out yelling at squirrels. But here's the catch Whether you get to truly retire or not often depends on the financial choices that you made all along the way. So is retirement a dream or a never-ending work meeting often depends on the financial choices that you made all along the way. So is retirement a dream or a never-ending work meeting? Let's find out Today. What we're going to do is we're going to cover some of the big decisions, to watch out for the common money moves, the good ones and the bad ones, and how to actually enjoy retirement when you get there.
Speaker 1:I'm your host, adam Richardson, aka the Profit Hacker, and I'm joined by the man in charge, mr Joe Haslam. Welcome to the Idiot's Guide. Okay, so the big question here that I want to ask is you know? I think a question is are you ready to retire? But I think you know more of an appropriate question, especially to our audience, is will you be ready to retire? Because you know, I don't think that oftentimes we're talking to somebody that's going to be watching a YouTube video, let alone even know how to open a YouTube video, let alone know how to type YouTube. All of those questions come into play when you're talking to somebody who is potentially retirement-aged. I'm sorry.
Speaker 2:That was a low blow.
Speaker 1:But it's true because I work with old people. Low blow, but it's true because I work with old people and oftentimes, you know it's uh, it's entertaining trying to see them interact with some of the modern day technology and apps. But anyway, neither here nor there. It's it's. It's the question will you be ready to retire? Well, what are the things that you need in order to retire? There's things like savings. There's retirement accounts. There's whether you have, you know, enough income streams that can support the lifestyle that you desire, and you know so. At the end of the day, retirement can sound like it's a great thing, until you realize the fact that there's things that really kind of checks and balances along the way that helped prepare you to be retired, that no longer exist anymore. And now it's action in your retirement.
Speaker 2:Yeah, you're there now, yeah, and once you're there, there's no more prep that can be done, right, just hope that you're ready for it. Yeah, and once you're there, there's no more prep that can be done, right, just hope that you're ready for it.
Speaker 1:Yeah, and I think you know that that's a hard reality for some people I hope it's just a few, but but also that I think it's often more common now because of our culture of spending and that kind of stuff. But when you talk about, like you know, I think we want to be careful using the word consultant, because in the world of retirement not just retirement, but like when you talk about investments or retirement options usually somebody has to carry a really fancy certificate in order to do that, and and you, I know you have a very special place in your heart for those individuals who carry a fancy certificate.
Speaker 2:Yeah. So people that are, there's a certification called a certified financial planner. That is really just a glorified salesperson, and it really irks me that they put themselves out there as we are financial planners, we are financial people, when in reality all they're doing is selling you a product. It's just an investment account, it's a retirement account that they're making a percentage off of, they're making the fees off of, they're making a commission off of. All they're doing is trying to sell you a program that really questionable how much it actually helps. Yeah, because you can set money aside. You can set into a savings account, you can put it into a money market account. There are a lot of places that you can put this money that you don't necessarily need to put it into something like one of these programs that they're trying to sell you, and you can find a lot better programs than what they're trying to sell you.
Speaker 2:But that's just it. They are selling you a product. They are not someone who's going to sit down with you, look at your finances, tell you oh, this is where you can cut costs, this is where you can maybe save on some of your income. They're not doing that. They're just selling you a product, and so that's why I have a hard time with them being called financial planners, because they're not. They're just selling you something, and real people who really help you with your finances are then the people that are actually going to move you forward. But to be a certified financial planner, the process is you have to learn all of the insurance rules, you have to learn all of the retirement account rules, none of which is financial planning.
Speaker 1:Right, and so to be a server, it's like the laws and regulations in order to even have the conversation about it, just so that you never address the actual product in which you need to represent.
Speaker 2:Yeah, so, yeah, so, but the idea of long-term planning is just making sure you have the money set aside, making sure you're looking at. On our last video we talked about how much you need to retire on and at bare minimum bare minimum to to live a middle class lifestyle was $600,000 by the time you retire. That's a lot of money and, yeah, I don't think there are a lot of people that have that kind of resource to be able to live for that for a long time, to be able to live for that for a long time.
Speaker 1:And I think you know there's a pro and con to retirement that we don't consider. Like you know, everybody thinks about retirement, about the freedom to do what you want, have your own schedule. You're just like, yes, I'm good, I'm free, you know. And then on the other side of it is this you know what, if there's financial gaps or you know, poor planning ahead of time could really make you have to, or force you to have to, work longer or stay in the workforce longer. You know you and I have got to have a shared perspective when it comes to the idea of retirement of you know it's not necessarily retirement, it's just what kind of work I'm doing now, you know, like it's an adjustment to what's continuing to stimulate me because, yeah, I don't want to be stagnant.
Speaker 2:Yeah, and and yeah, and I personally, uh, you know, I don't think retirement is a good thing. You know, maybe when I'm like 90 years old and I'm, I'm walking around with, you know, walker and a cane. But in in high school I had, there was a substitute teacher. She was older than dirt and she was crotchety and cranky but she loved what she did. She loved coming in and just babysitting them teenagers, and I, you know if, if, and she walked around with her cane and her Walker and she was still a substitute teacher. I don't know how good she was. I mean, she was great at babysitting teenagers. But you know, realistically, if you enjoy doing it, why would you ever just sit at home all day? It doesn't make any sense.
Speaker 1:Yeah, you know, I think, thinking about the success of good financial planning, good perspective with that, if your retirement is, you know, endless golf and your meal plan is endless ramen, you've got to work on that plan, that that plan, because one you're, you're in your at at the older age, eating that kind of endless ramen. I was in a conversation the other day about somebody who that was a normal thing for them, almost, you know, every single day they were having ramen and the amount of just what is in ramen is just I'm not going to like. This is a different episode, but Holy cow.
Speaker 2:Oh man, there are so many things that you're putting.
Speaker 1:Yeah, you're putting into your body that that's really dangerous. Like it's okay to have ramen occasionally, like it's not going to hurt you If it is a food group.
Speaker 2:That exists in your daily routine.
Speaker 1:It is not pick an apple, please, For God's sake. So I think the goal in this is just take a look at this stuff early, take a look at your finances and and try to put some of those things together, you know, as early as you possibly can, because it's only going to continue that improvement or or get better and better in the long run, because you can't predict the future. You don't know what that's going to look like, and having at least some kind of a plan in place helps buffer anything else that may come along the road that might derail some of that progress. You know, if you have nothing and you just eat ramen for a living, then it's going to be a really fun retirement. Working for, you know, a construction company, I don't know. Greeting at Walmart, I don't know. Yeah, they always say that. But then I was like I don't know if that's necessarily like. I don't know If I was 90, I probably would be a greeter at Walmart. Yeah, other than that, I it's not stimulating enough.
Speaker 1:So, hey, if you're enjoying this episode and dreaming about your perfect retirement or just trying to figure out how to make it happen, help us keep the conversation going. Hit that subscribe button so you never miss an episode, and give us a like. If today's tips give you something to think about, here's the big one. Leave us a comment. Tell us your ultimate retirement goal. Is it traveling the world, starting a new hobby or just yelling at your front lawn? We'd love to hear from you and your thoughts might even inspire the next episode. So subscribe, like and don't forget to share your retirement dreams with us in the comments. Let's plan for that future.
Speaker 1:So there are some things that, during a retirement age, are kind of common, in the sense of you know decisions that you have to make financially, and some of them are good, some of them are bad and some of them might end up being mistakes. So you know, let's say, for example, I have a mansion that I live in and you know I'm, I'm planning on $300,000 to retire with, and just the light bill alone is going to kill me. So you know, maybe, maybe it's an option of that. Like, oh, do I need to drive the Ferrari? Or you know, in Utah it's probably an Escalade, so it's a gas guzzler, yeah. And then you know, is it? Do I need to live in a four-bedroom, five-bedroom house? You know, maybe. But at the same time, like if it's just my wife and I, or at this age I don't know. Whatever it looks like At that where you are. I got to really think am I living in a situation where I don't really need as much space as I have? Do I need to downsize those sorts of things?
Speaker 2:Yeah, and downsizing is a great way. So when you think about how much money you need to retire on, if you're sitting on a ton of equity in your house and that's where a lot of the value of your assets are not just liquid cash but an actual home then, yeah, sell the home. Sell the home when the price values are high and then take that as an opportunity to just build up that balance in your bank account. Yeah, get an RV and travel, or get a little small house because you don't need anything big. Your kids can find their own place to stay when they come for the holidays. You know it's an opportunity to be able to use that equity to your advantage.
Speaker 2:And so you know, when you think about you know the big house that you have that's a lot of maintenance on the house, that's a lot of bills, that's a lot of utilities.
Speaker 2:It's a lot of utilities for you know heating it or cooling it that you don't really need because you're not really using the vast majority of that house. Yeah, you know all those things that go into a larger property even the property taxes are higher on bigger houses all those things that go into a larger property, even the property taxes are higher on bigger houses. Everything is just more expensive with a bigger house, which is where a lot of people get in trouble. When they go from their starter home to a big house, they think, oh yeah, my payment's going to go up, but then they forget about all that other stuff that goes up with it, and so this is an opportunity to be able to take that and say, okay, I don't need this anymore. My kids are out of the house, they're grown that, we're done. I can now downsize to a much smaller place, and that's this is just a great opportunity to do that. And then you turn that asset into liquid cash that you can then use for long-term.
Speaker 1:Yeah, I mean there's things that you can do if you have some of that little bit more liquidity, um, to some of the larger things that you used to have that you needed at the time. Now you've downsized, you know that that helps you in a position for particular healthcare needs, if that, if that arises, and also, like you said, bolsters the, the, the retirement savings. You know those are both elements that are really really something that you need to pay attention to during those years. But sometimes there's pitfalls in that where all of a sudden, you take up knife making and you have to buy a garage and then you have to buy a I can't remember what that's called the forge Forge, that's what it's called. I was like kiln, that's pottery.
Speaker 2:Well, you need a kiln to um. Now my brain fart is going uh to um. So after you heat it, you set it and then you, you, um kiln it. Uh, there's a term for I can't remember, but yeah, so there's a process that they don't ever show you in the forging, that you have to actually heat it at a set temperature for a set amount of time in order to set all the metal and all the grain and everything in that position. So it's not just you forge it and you're done, you have to actually heat it. Heat treat.
Speaker 1:Take me as an example of this, where I'm like I would be the guy that took up. You know knife making, but I don't have a lick of anything to help me do that, nor of space.
Speaker 2:Well, talking about health care costs, and you know, injuries and things that are going to be capping. You take up knife making. It's not just the cost of having the garage and all that. You're going to need that extra when you drop it on your toe and you have to have your toe reattached.
Speaker 1:So overspending on some hobbies might not be the best thing. The other thing that can arise still is, you know, kids are still potentially around and your children may come into some financial needs that you've you in your lifetime may have faced. You know, their kid, your kids, kids and all that kind of stuff like it trickles down the line at that point you're talking a couple generations at least, and you know, and that that might be something where that's, that's an ask that exists out there in in the situation, and then, underestimating anything medically that may arise, you know, uh, like, granted, it's, it's, there's some amazing health care, but, but health care has a price to it and you know, if you break a hip accidentally and you have to replace it with some titanium, titanium is pretty pricey. Hopefully they'll have some robotic thing in the future that.
Speaker 2:I don't have to.
Speaker 1:I'll just be like leave it broken, it's fine, I'll just put a robot leg on Working on it. So the idea is downsizing. Here's a pro of this Downsizing can free up funds for travel or hobbies or other things and, like we said, bolstering savings. But the other side of that is, you know, the con of that is unexpected costs like medical or home repairs can really derail those plans. So, you know, the idea is like an RV looks good, but uh, if it's, if it's eating up all of the savings, because you're, you know, traveling back and forth across the country every single week, you know you might want to consider, you know, staying at one koa longer than that you know, hopefully you're not at a koa, hopefully you have a little better option, but uh but yeah, I mean, and that's the thing I mean you got to take a serious look at your finances.
Speaker 2:It's not just oh yeah, I'm retired, it's all done, cause that's going to lead into a lot of problems. You've got to sit down, understand where you're at, understand where you're going, and and that's where a real financial planner, someone who's actually going to sit down with you, an accountant, uh, someone who knows your finances, you know, and who's actually going to sit down with you, an accountant, someone who knows your finances and that's again an accountant is really good for that, because they know your taxes, they know your situation and they will give you that financial advice. They're not just there to sell you an insurance product or an investment product. They're there to actually help you with your finances.
Speaker 1:Yeah, and I think I'm going to adopt this term Um, so the other. The other thing that could happen is basically, you know this, your kids might still be calling you bank of mom and dad. You know, and and honestly, like I feel like that every flipping day I'm going to get a logo and a jingle and be like oh yeah, he was a welcome to the bank of mom and dad. You know, I remember as a kid my dad, had a Halloween costume.
Speaker 2:It was a t-shirt that just had an ATM on it with a a hundred dollar bill coming out of it. That was his Halloween costume. He was an ATM.
Speaker 1:I think a good point or a good idea with that is, like, if you are the bank of mom and dad, it's okay when you're, when your kids are younger and that kind of stuff. Like my kids are still minors and you know they're very dependent on me in order for them to exist and I'm grateful that they let me have that opportunity. But, uh, but it's it's. It's the time when they have kids, or even their kids have kids, when you start going, okay, hold up, hold up a sec. Like if you are still bank of mom and dad, at that point it's time to close the branch, Like it just needs to be shut down. So you know it's okay to be able to downsize, to pursue a little bit more flexibility in basically all fronts, from your health care to you know your living situation, so it's not so costly to the vehicles. But make sure that your utilization of that extra cash liquidity is really done with a good plan, right, yep, okay, well, hey there.
Speaker 1:Retirees, or those dreaming of the day, whether you're planning to kick back in your golden years or wondering if you'll ever actually be able to say goodbye to that 9 to 5 grind. Here's the deal. Your financial choices today can make or break that future. That's why we're thrilled to introduce our Financial Empowerment Membership your go-to resource for taking control of your finances and creating the retirement you've always imagined. From expert advice on maximizing your retirement savings to tools that help you plan for the long haul, this membership is like a personal trainer for your wallet.
Speaker 1:And it's not just about retirement. It's about giving yourself options, freedom and confidence at every stage of your financial journey. So why wait, future? You is already cheering you on. Check out the link in our show notes to learn more about the financial empowerment membership and start building the retirement you deserve. Now back to the show. So I think one of the most important things about retirement is trying to enjoy it, because if your retirement sucks like that's, that's a really, really big highlighting point of your life. And if it is garbage like I don't want it I'm not, I don't want to, I like one I probably wouldn't retire because, like you know, we we agree that it just means I'm adjusting how I'm making money.
Speaker 2:Yeah, you know, one of the big problems that people run into is when you retire, you are no longer engaging. Yeah, you know, you're no longer using your body, you're no longer using your brain, and that is very damaging to a lot of people.
Speaker 1:Well, statistically they even say like there's evidence that shows like it's part of that value and being in motion, being effective and having some kind of matter to your existence, sort of thing that once that kind of drops off the radar and you're just kind of quiet home alone, not, you're stagnant. Like statistics show you aren't going to live much longer.
Speaker 2:Yep, death comes quickly when you are not active, yeah, and so that's why it's important. And and another thing with retirement is you know, I always give the example you're working so hard and you're moving, and then retirement is this brick wall that you just run into. And if you just run into this brick wall full steam, that is just so bad for you. Emotionally, intellectually, socially, you can't do that. And so when you're looking at retirement, you think about okay, here's the amount that you work, here's the amount of free time when you're doing your regular job. Retirement should not be an instant. That's a huge hit.
Speaker 2:What you need to do is you need to start planning your retirement and start slowly adjusting into retirement.
Speaker 2:And so now you're working part-time and part-time enjoying yourself with whatever hobbies or other things, because now this is a gradual move and this helps financially too, because if you're still working, when you start looking at these hobbies you want to do, such as your knife making, you still have money coming in where you can start buying the equipment for that hobby.
Speaker 2:And then you start spending more time with that hobby, getting good at it, and then you start adding some other hobbies. You know, when you start cutting off toes and fingers. By the way, it's bladesmith, oh sorry, um, when you're a bladesmith, um. And so eventually you're going to get to this point where now in retirement, it's been a transition into a retirement lifestyle where you're no longer working but you are fully fulfilled in your hobbies and other things, so that it's less of a jolt, it's less of a difficulty and you're going to enjoy it so much more because you've slowly transitioned into it. And so that's, I think one of the biggest things is, you know, financially, enjoyment wise, it's getting to that stage where you are still engaging socially, intellectually, physically, so that it is still a fulfilling process.
Speaker 1:I think one of the things that I I like it's it's a contrast as you go, like when you're 15, 16 years old and you get that first job, there's not a lot of like expectation for you to just be the master, ok, but you're, it's, it's stimulating, you're learning, ok, now you've done that, you've done all this stuff and you had that like first introductory job. Well, I feel like you know, know, something that just kind of keeps you stimulated is that same environment. So you're just full circle, like you even progress, maybe potentially further than that, by ending up in diapers, a you end in diapers.
Speaker 2:Oh joy. This is why I won't ever actually retire, because I don't see a lifestyle where I'm just going to enjoy doing nothing. I have hobbies where my hobby is working, my hobby is business, right, and so it's just. I don't ever see myself in that position to ever want to retire.
Speaker 1:Yeah, I think you know, position yourself in a more strategic way where you might be able to take advantage of. You know how you have created good income streams. You know, hopefully, like in my thoughts is, I don't want to necessarily be something where I'm punching a nine to five, you know it's. It's something more where I have the creative license because of what I've built, that if I want to spend a summer in greece, I can afford it. You know, yeah, well, that's stuff and still have, like the income streams aren't dependent on my presence. That that's what.
Speaker 2:I want to build and look at where is your money at. So one thing to think about is if you've got $600,000 set aside in a savings account, money market, 401k, wherever it's at, how much money are you making off that $600,000? For every 1% on that $600,000, so if you're getting a 1% return, which is about what you get on a savings account, you're only getting $6,000 a year. That's not a lot, and every year you use more of that money. That amount goes down and so you're getting diminishing returns because you're using more of it. But say you're getting 5% Well, now you're only making $30,000. But say you're getting 5% Well, now you're only making $30,000 in interest and 5% is a pretty high interest rate and so not much is going to give you a consistent 5% return. You may fluctuate a lot, but you're never going to get that 5% return.
Speaker 2:So when you're looking at, yeah, I've got a lot of money set aside, how much of that is going to be an income stream? If you're using that money to invest in businesses, invest in stable industries, well, that can then produce a much better return that actually produces a cash flow income. And then you're looking at okay, I've got this amount set aside here and it's reserved to produce here. I've got some in savings, some in a business and I'm getting X amount to cover my everyday expenses. You know, is there enough there that you can then put into vacations? This is the important thing. You don't just go into retirement saying I'm done Lazy river time, no, you've still got to think got a lazy river.
Speaker 1:Sounds incredible in my backyard there you go.
Speaker 2:Maybe you take a little bit of that money and build a lazy river and that's your lazy instead of the forge, I'm building a lazy river.
Speaker 2:There you go but you've got to still be actively involved in your finances to make sure that you've got enough to last you. And that's the hard thing is, you've got to make sure that there's enough to last you your retirement while still having fun. And if you've budgeted, if you've built that entire plan for a 40-year retirement and you've got a vacation built into that every year to Ireland, to Greece, to Australia, wherever you want to go, then great, you've got a great plan and now you're set. But having that plan in the first place is what's going to allow you to have that fun.
Speaker 1:Well, and I think, like we've really stressed the emphasis of a plan having that stuff, because if you just jump into it thinking like you, you said I'm going to relax on a lazy river in greece, you know, then it's probably gonna run out of money, you're gonna run out of running pretty quickly. It's, it's. You know, you, you have to have that perspective of longevity because you, because you're not, you're not generating money, um, or you're, or you're not even spending like you're 25 anymore. You need to enjoy life like you're 85 and not have the regrets of because we blew it here, so now I got to go back to work as a greeter, because I'm picking up this. So the idea of retirement is you definitely want to do the things that you love to do, but you also, you know, got to be careful how you, how you spend that money. If you know and know that, even though you're in retirement, it doesn't throw out a plan or what they use is the word is budget, use a. You know you don't have like whatever that works for you. However, you have that plan in place. It doesn't disappear when you're retired, it it's reinforced and you're more dependent on it because you may have a, a shift in your income. You're in the shift of style of income that you're getting. So if that's the case, then you need to make sure that that plan that you have in place to make sure that your livelihood is taken care of, is is is set still and you have a good plan there, you know, but, uh, I think it's, it's really kind of something important is to focus on creating the balance between fun and financial stability so that you can continue to enjoy the golden years to the fullest that they can be, and not be, you know, not be chained down with some kind of obligation in the process of that.
Speaker 1:So, um, just to recap, step one make sure you're ready. You know, if you're younger and this is idea of like, will I be ready to retire? A lot of it has to do with financially and also emotionally. Will you know like those opinions vary. Our opinion is different than your opinion might be about what retirement looks like and you know, it might be something where you're like I really, really want to yell at squirrels on my front porch and that's it. That's that, I'm content and I'm like I hopefully it makes money. That's all like like. Step two watch out for the, the, the common money traps plan, you know. Plan for healthcare, that that that comes up, don't, uh, don't get the RV, that just you know the giant lemon driving down across the country sucking all the gas out of your life, you know. And then three is retirement, is what you make of it. So find what makes you happy and budget for that wisely.
Speaker 2:Plan for it wisely. I hate the word budget, know, and you know that, I know, I'm sorry, that's like.
Speaker 1:That's like a budget is a swear word in this house. Okay, you'll get soap in your mouth if you're not careful yeah, did you ever get the soap in your mouth?
Speaker 2:oh many times. And yeah, I'm not gonna go into that. But yeah, don't do that. If you are doing that, are an awful person.
Speaker 1:I had a kid, or I had a friend of mine who he was raised by. This is totally rabbit hole. But Tabasco sauce, they would put Tabasco sauce. Now he absolutely hates it. The smell of it causes anxiety. I'm like, oh poor guy man, Tabasco is delicious, yeah no, there's.
Speaker 2:there's a lot of ways to mistreat children and call it punishment.
Speaker 1:Yeah, anyway so retirement isn't about stopping. It's about starting something new, whether that's traveling the world, about starting something new. Whether that's traveling the world perfecting your golf swing or just enjoying your free time, the right financial moves will make it happen. So plan ahead, keep your squirrel yelling to a minimum, of course, and remember retirement is just the beginning of your next great adventure. Anything else you want to add? No.
Speaker 2:Time for Jokes with Joe. All right, here we go. All right, how does a spider go into battle.
Speaker 1:Oh, I don't know.
Speaker 2:Well armed, that's terrible Joe. I don't know Well-armed. That's terrible, joel, I know, and it's great, I love it.
Speaker 1:Oh man, so we've reached the end of our show for today. Thanks for listening, Thanks for watching. Don't forget like and subscribe and comment. Life's too short, so keep laughing and learning and remember idiots have way more fun. Check your shoes.