12 Good Years of Retirement -- That's It?

Most retirees spend decades obsessing over a thirty-year financial plan, but the biological reality is that you may only have twelve high-energy years to truly check off your bucket list. In this episode, Dr. Chris Mullis explains why your "health span" is the most critical variable in your retirement trajectory and how to avoid the trap of being overly cautious during your peak years. We also head to Mission Control to settle the "Kit Kat" debate of estate planning: is a joint or individual trust the right launch vehicle for your legacy?
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EPISODE RESOURCES:
→ Your 12 Good Years -- Dan Haylett
→ Grab the Episode Show Notes

IMAGE CREDIT:
International Gemini Observatory/NOIRLab/NSF/AURA

Transcript

SPEAKER_00 0:04

We spend decades obsessing over our retirement number. The amount of money we need to accumulate to fund a 30-year retirement. But what if I told you the version of you that can actually enjoy that money? The one with the energy to hike, to travel, to play. That version of you has only 12 good views. And you believe it, 12 good views. Today we're looking at why your health span matters far more than your wealth span. Are you ready? Welcome back to Retirement Isn't Rocket Science. This is episode 17. I'm your host, Dr. Chris Mullis. I've spent my first career as an astrophysicist mapping the far reaches of the cosmos with NASA's Space Telescopes. Now, as a certified financial planner with 21 years of experience, I help you navigate the nearer universe of retirement. Our mission here is crystal clear. Lower your taxes, strengthen your portfolio, and give you the confidence and the capacity to spend more. Buckle up. We're going to master your money and explore the mysteries of the universe along the way. In today's show, are you wasting your go-go years preparing for your no-go years? On the trust trajectory, navigating the choice between joint and individual trusts. And finally, we gaze at NGC 2040, a nebulous flower that showcases the dramatic story of stellar life, death, and rebirth. Welcome to the Retirement Briefing Room. This is where we huddle up to take a close look at the important aspects of your financial life, spotlight pathways of success, and think about how to integrate these into your retirement mission plan. Today we're conducting a deep dive on a truly powerful article titled Your 12 Good Years, written by Dan Halett. Dan is a UK-based specialist who looks past the spreadsheets to the biological reality of aging, challenging the standard 30-year flat income retirement model. He argues that our full capacity years are a finite resource, a message that lit a fire under his readers, sparking hundreds of comments from the people currently in the trenches of their own 12-year missions. Let's dig in by looking at the data no one wants to hear. When you look at a retirement planning calculator, it usually tells you to prepare for 25 or 30 years of income. That's what we do in my retirement and tax planning practice every day. Engineer 30-year income plans. But Dan points out a data point most people ignore healthy life expectancy. While you might live to 87, your years of full capacity, the years you can hike, travel, and chase grandkids without fatigue, often start to decline in your early to mid-70s. For a 60-year-old, that gives you roughly 12 good years. This recognition intersects perfectly with one of my mantras that I repeat often to our clients. Make hay when the sun is shining. We talk about the go-go, slow-go, and no-go phases of retirement. Biology tells us the go-go years have a shelf life. If you don't recognize this, you risk spending your highest energy years being overly cautious, effectively preparing for an 85-year-old version of yourself that won't have the capacity to enjoy the money anyway. Let's consider the biology of money. One of the most robust findings in retirement research is that spending peaks around age 75 and then drops. Most people think this is about money, but it's actually about physical limitations. As Dan notes, people in their 80s aren't skipping the trip to New Zealand to be frugal. They're skipping it because the flight is exhausting and the hotel without an elevator is a barrier to entry. This reminds me of the number one principle in our retirement income planning philosophy. Income is the outcome. Your wealth should be converted into experiences and memories while you still have the physical capacity to engage with them. We saw this in the comments from Dan's reader named Ron, who noted that at 72, he could finally feel the wheels starting to come off. The goal of the plan is to make sure Ron had his biggest adventures before that point. Let's look at the deferral trap and the Camino crew. The cruel irony of diligent savers is that they often spend their first decade of retirement living exactly like they did while working cautiously. That's how they lived that first decade. They treat their 60s as a rehearsal or their 80s. But we saw a different path in some of Dan's readers' reactions. We had the Camino crew, people like Betty, who at 74 realized her mountaineering days were fading, so she pivoted to walking the Camino de Santiago. She didn't wait, she adjusted. To make this pivot, you need to be operating with a retirement paycheck mindset. By structuring your portfolio to deliver a predictable monthly paycheck, we move you from being a builder to a spender. It gives you the confidence to say yes to the trip now, knowing that the check is coming next month, regardless of what the market or the economy might be doing. Dan challenges us with the math that matters. 12 years is only 144 months or 624 weeks. Every week you spend waiting for things to be certain is a week of high capacity life you don't get back. This leads to a deeper question. What are you actually saving for? If you are 60 and financially secure, are you saving for the no-go years when you'll be less mobile? One reader, Kevin, highlighted this by quoting, die with zero. He stopped buying stuff and started gifting money to his children now, with quote, giving with a warm heart rather than a cold hand. End quote. The message isn't all doom and gloom. There is an uplifting truth here. Dan points out that you can extend this window through intentionality. We heard from Jeanette, who bought a pony at 58 to stay active and is still riding at age 70. Or Angie, who at 66 converted her garage into a home gym to extend the go-go years. And you should have a robust plan for retirement, an ongoing income investment, and tax plan so that you can spend with clarity and confidence. When you have a plan, a home gym isn't an expense, it's a strategic investment in your mission longevity. But we do have to be real. People hold back because they are afraid. One of Dan's readers, named Patty, shared how a spinal injury just two months into retirement delayed her carefree years. Others worried about the astronomical cost of long-term care. This is where planning provides the shield. One of our core principles is storms are the norm. You need a war chest of bonds and cash so that when a health storm or a market storm hits, your lifestyle isn't compromised. And later upon that, tax smart withdrawals to make sure you aren't overpaying the IRS during those 12 good years, preserving more of your hard-earned capital for your adventures. Dan ends with a haunting image of 78-year-old retirees sitting on tons of money, wishing they had gone to Japan when they had the stamina. They saved their money, but they spent their good years. In my day job as a retirement planner, we use guardrails to maximize our clients' spending to prevent this dynamic. Guardrails are your permission slip to enjoy your wealth. When the market is up, the guardrails tell you it's safe to spend more on those memory-making trips. Don't waste your 12 or 15 good years preparing for the years that come after. Use them now while the version of you that can fully live those experiences still exists. In retirement planning, we don't just count the money, we count the days. Almost nobody in retirement runs out of money, but everyone eventually runs out of time. Your 12 good years are the prize, the mission objective you've spent perhaps 40 years working to achieve. Don't let the caution that built the nest egg become the cage that keeps you from enjoying it. You'll find a link to Dan's article in the show notes and in our weekly newsletter. I strongly encourage you to go read the article word for word. It is perhaps one of the most amazing retirement articles I have ever seen. Now, let's head over to Mission Control to answer your financial questions and get you retirement ready.

SPEAKER_03 10:41

Discovery Houston, 20 seconds to LOS TRISK.

SPEAKER_00 10:47

When you're building a rocket, you have to decide if a single booster or a multi-stage system is the best way to reach orbit. Estate planning is no different. Is your family better served by one big launch vehicle or two specialized ones? That's what this week's Ask Mission Control is all about. Thanks to this smart question from listener Amanda. She writes, My husband and I are trying to decide if we should set up separate trusts or a single joint trust. How should we be thinking through this? Amanda, thanks for reaching out to Mission Control. This is a fantastic question because it's one of those foundational structural decisions that can impact your financial trajectory, potentially on an intergenerational timescale. Before we fire the engines on this answer, I have to give you my standard mission warning. I'm a certified financial planner, not an attorney. Although I've reviewed hundreds of estate plans, I do not practice law. And this, as always, is for education purposes, not legal or financial advice. With that out of the way, let's talk about your estate vehicle. In the world of retirement planning, especially when you've worked hard to build a nest egg like yours, we look at trusts as the cargo hold for your assets. They help your estate avoid the slow, public, and often expensive process of probate, keeping your private business off the radar of the public record. When it comes to joint versus individual trusts, I like to use David Houghton's analogy that's a bit more down-to-earth than rocket fuel. Think of it like a Kit Kat bar. A joint trust is like a single Kit Kat package. You have two sticks of chocolate inside, but they share one wrapper. The strength here, it's all about the simplicity at the launch pad. You have one document to sign, one set of rules, and typically your assets like your home or your joint brokerage accounts stay in one name. For many couples, especially those in long-term first marriages with the same beneficiaries, like your children, this is very palatable. It feels right because you've built your life together. So why not build your trust together? It's often cheaper to set up initially because your attorney is only drafting one rapper. The downside of the one rapper approach shows up if there's a change in the mission parameters. If there's a divorce or you and your spouse have different ideas about who receives the crumbs, remember the Kit Kat, right? The crumbs, when one of you passes away, things get sticky. In blended family scenarios where there are children from previous marriages, a joint trust can sometimes lead to complications or unintended re-entry issues where one side of the family gets left out of the inheritance if their surviving spouse changes the rules later. Now, the other side of the coin is creating two separate individual trusts, one for you, Amanda, and one for your husband. Think of this as two separate snack size Kit Kat packages. This offers much cleaner administration when a spouse dies because the assets were already clearly bucketed in your own trust during your lifetime. There is no guessing game about what belongs where when the first person reaches the end of their journey. It's very logical. It also provides a higher level of protection for your specific wishes. If you want your half of the estate to go to a specific charity or specific family members, your trust remains your own mission profile. The trade-off here is maintenance. Having two trusts means you have two sets of books. You have to make sure your bank accounts and your investment accounts are titled correctly. Some in your name, some in his. You have to equalize the assets. If one trust has $2 million and the other has $50,000, the strategy doesn't work as well. It requires more ground control on your part to keep things balanced during your lifetime. In my 20 plus years of walking life with clients, I can tell you that there are wise planners and wise attorneys on both sides of this debate. It's hard to declare either approach outright wrong or right. As a fee-only planner, my job is to look at your total mission. If you value simplicity and your goals are perfectly aligned, the joint trust Kit Kat is a great streamlined vehicle. But if you have a complex family dynamic or you're the type of person who likes every bolt and screw in its own labeled bin, the individual trusts might give you more peace of mind. We tend to see experts favor the joint trust about two-thirds of the time, which seems to align with the broad contours of the work to be done where you want to solve it with the simplest tool available. So how can you take action here, Amanda? Take a look at your current asset titles. Are most of your accounts joint? If so, a joint trust is a path of least resistance. If you have significant separate inheritances or a blended family, ask your attorney to draft a pros and cons list specifically for individual trusts. Whether you choose one wrapper or two, the most important thing is that you're building a shield for your legacy. Retirement isn't just about the money you spend, it's about the peace of mind you keep. Many thanks again to Amanda for submitting this fantastic question. If you've got a retirement question or a financial question you'd like us to answer on the show, head over to retirement isn't rocket science.com and click Ask a Question. Or even better, you can skip to the front of the line by calling Mission Control at 704-234-6550 and record your audio question. Now let's broaden our perspective and head over to look at a fiery rose captured by the Gemini South 8-meter telescope in Chile. Most of us spend our lives planting gardens, saving for a rainy day, nurturing a nest egg, and hoping for a bloom in our golden years. But what if I told you there's a rose in the cosmos, 160,000 light years away, that blooms not from water and soil, but from the fiery explosions of dying stars. It's a stellar reminder that in the universe, as in retirement, the end of one cycle is just the fuel for the next great adventure. Welcome to the retirement big picture part of our show. This is where we look up and look out to expand our appreciation and understanding of our amazing universe. Today, friends, we are looking at something truly spectacular. If you've ever looked at a rose in your garden and marveled at its delicate layers, you'll appreciate the fiery rose of the cosmos, technically known as NGC 2040. Now, I know what you're thinking, Dr. Chris, that sounds like a tax form. But trust me here, it's much more beautiful than a 1099. Captured recently by the Gemini South Telescope in Chile, this nebula looks like a vibrant flower of red, orange, and yellow wisps floating in the dark. How did we find this cosmic blossom? Well, it wasn't a recent discovery by any NASA satellite. It was actually first cataloged back in 1888 by an astronomer named John Dreyer. He compiled the new general catalog, which is why we call it NGC. So this is NGC 2040, the 2040th object in this catalog. Back then, they didn't have the eight-meter mirrors that we have today. They just saw a fuzzy patch of light that was devoid of any colors. It took modern technology, specifically the International Gemini Observatory, to reveal those petals are actually layers of glowing hydrogen and oxygen gas. If you want to find this rose, you'll have to look towards the constellation Dorado, the dolphin fish. Now, here's the catch for our listeners back home. Is it visible from the United States? Unfortunately, no. The fiery rose resides in the large Magellanic cloud, which you may recall from our previous episode, is a satellite galaxy that orbits our own Milky Way galaxy. Because it's so far south in the sky, you'll need to be in the southern hemisphere. Places like Chile, Australia, New Zealand, South Africa to see it. For many amateur astronomers out there, if you ever take a bucketless trip to the Southern Hemisphere, the large Magellanic cloud is easily visible to the naked eye as a faint glowing cloud. But to see the rose itself, you'll need a decent telescope and very dark skies. For the professionals, though, ground-based giants like Gemini South use special filters to see the blue of oxygen and the deep red of hydrogen, literally peeling back the layers of the flower. Let's examine the stellar life cycle, which is a lesson for retirees. What makes NGC 2040 so fascinating to me as a planner is the way it stays beautiful. This cluster is what we call an OB association. It's full of massive O type and B type hot stars that live fast and die young. That's astronomically speaking, their lifespan is just a few million years. These stars actually explode as supernovae. Now, in our world, an explosion sounds like a disaster for your retirement portfolio. But in the cosmos, these explosions provide the shock waves that compress gas and dust to form new stars. The material they eject, carbon, oxygen, iron, is exactly what is needed to build planets and eventually life. It's a perfect metaphor for what we do in mission control for your retirement. You've spent 30 or 40 years in the high heat phase working hard, accumulating, and burning. Bright. Retirement isn't the end of that energy. It's a transition. It's taking the elements you've gathered, your wisdom, your wealth, your time, and using them to seed a new purpose. Just like the dust of a dead star becomes the seed of a new solar system, your career success becomes the fuel for your next chapter. As we look at NGC 2040, we see a beauty that is fleeting. In a few million years, a blink of a cosmic eye, this gas will dissipate and the stars will drift apart. It reminds us to enjoy the bloom of our own lives right now. You've worked hard to grow your Nest egg. Don't be afraid to let it fuel your adventures, your legacy, and your community. Planning your retirement trajectory might feel like rocket science, but when you look at the big picture, it's really about making sure your stars are aligned for a beautiful transition. You'll find the Gemini South image of NGC 2040 in this week's newsletter, The Launch. You can sign up for the launch at retirementisnrocket science.com.

SPEAKER_03 23:16

Welcome home, Columbia. Beautiful, beautiful. We're gonna dust it off first.

SPEAKER_00 23:32

Not 30, not even 20. Now it's time to open the hatch. This is your spacewalk. You're stepping out of the routine and into the bright light to overlay today's insights into your plans to worry less and retire more. This isn't just a stroll. This is where the work gets done. To move from theory to better outcomes, here are your next mission objectives. Number one, the high capacity audit. Look at your bucket list. Identify the three items that require the most physical energy or mobility. Move those to the very top of your list for the next 36 months. Do not defer them. Number two, the permission slip conversation. Sit down with your partner and ask, are we optimizing to die with the biggest bank account or to live the richest life? If it's the latter, ask your financial advisor how to front load your income plan. And number three, secure your word chest. Ensure your financial plan acknowledges that storms are the norm. Having three to five years of spending tucked away in non-stock assets is the only way to have the peace of mind required to spend your go-go years without looking over your shoulder at the market. I challenge you to take one idea from today's show and put it into practice this week to make your retirement even better. Remember, you've done the hard work of saving. Now let's do the smart work of planning. Until next time, keep your eyes on the horizon. Enjoy the adventure. You are go for retirement.

SPEAKER_03 25:32

We copy your will stop, and we'll take this opportunity to congratulate you, Atlantis, as well as the thousands of passionate individuals across this great spacefaring nation.

SPEAKER_00 25:44

We thank the National Aeronautics and Space Administration for providing the radio communications between the space shuttle astronauts and the flight controllers. This show is for informational and entertainment purposes only. It is not specific tax, legal, or investment advice. Before considering acting on anything you hear in this show, first consult your own tax, legal, or financial advisor.