Many of you have asked what software I'm using in these projections. The software is only available through licensed advisors, but you can get lifetime access to it in my Retirement Planning Academy here → retirement-planning-academy.mykajabi.com/rpa
Looks interesting. How much of the content is different and more specific that your TH-cam videos? I’ve watched them all😊 Will it walk us through how to input into this software?
The information in this video is exactly what i've been looking for! So just to confirm, simply by joining the Retirement Planning Academy, i'll have full access to the software tool you used in this video? even without being a client of your firm?
I retired seven years ago. When I retired I owned my own home on a five acre parcel and my truck was paid off. After utilities, insurance, taxes, food and just about everything else, my monthly cost is around $1100. Instead of focusing on how much money I need to save, I focused instead on how well can I prepare and what makes me happy. I get immense amount of joy working the land and it keeps me in shape. I have great neighbors in a community that is unbelievably good. In fact, when I dream about going on my dream vacation I think of right here where I live. If you focus on being happy and preparing sensibly, then everything else becomes trivial.
You’re doing exactly what I dream of. I’m retiring in about 12 years. I’m investing almost 25% of my salary. I’m going to own a little house in the country side and grow a garden. Have the family over and just enjoy life.
I also have a large estate (6 acres), that has a current value of around $2.5 - $3m.. it’s fully paid off and we love the land but I’ve thought about selling once we retire (sometime in the next 3-5yrs)…. My thought is, would I be better off renting in retirement so I don’t get hit with major repairs or expenses on a home??? New HVAC can run 15-20k.. a new roof 20-30k… those would be brutal expenses in retirement…
The right time to retire is when you no longer wish to work for a living AND you ARE POSITIVE that you can afford it. But remember, if you leave your job without sufficient resources, you are not retired, you are unemployed.
This was great. I appreciate your soft calm voice and the absence of annoying sponsors and pushing for subscribers and likes. Generally classy. Thank you!
Great presentation. We have for 48 years been savers. We are retired and did a similar analysis two years ago and and repeated it over and over and over again. Couldn’t believe the results. It showed that we weren’t spending enough to meet our goals and still have a fair amount to leave to the next generation. Now we are thoughtful spenders. We always thought of ourselves as middle class but it turns out we are rich 😂😂😂😂. Who would have figured. 😊
@@TuBui2I regret not traveling more with our three kids (now adults). At one point, we were investing $1000/month in their 529 plans and fully funded their college educations. You can’t predict your future income level when in your 20’s. You also can’t predict how far you’ll advance in your career, i.e. working your way into management. We never imagined our salaries would be as high as they eventually were.
The most impactful thing I've heard is that planning is very important, and it is 100% guaranteed that your plan will be wrong, but by doing the planning you learn what levers to pull to effect things so you can adjust your life to fit the circumstances.
You don't need a 2 million dollar portfolio. You can live well on $30,000 per year as long as your house is paid off and you have good medical insurance. You may *want* a 2 million dollar portfolio but you don't *need* one. With 2 million, they can quite reasonably live on $100,000 per year the rest of their lives. Even at 2% returns (and you can get 4.8% today). $100,000 in *spending* money is equivalent to having a $150,000 salary. And when you consider the cost of working*, it's more like having a salary of $175,000. * Extra car wear requiring a new car twice to thrice as often, fuel, extra wear on more expensive clothing, dry cleaning, lunch out...and likely buying prepared food for dinner *and* breakfast often because you are too tired from working. Seriously, retired on much less, vacation 4 weeks a year (skiing which isn't cheap), still eat out 15 times a month, someplace really nice once a month, buy $600 worth of new clothes per year, etc. I'm now retired 12 years. I still have enough assets to last the rest of my life tho the recent burst of inflation *did* hurt a bit (I'd say it cut my fun money by 10% per year).
James, I’m 57 and I have been watching videos about retirement on TH-cam endlessly. This was by far the most informative and helpful. At least it will help me to initiate conversation with the financial advisor and ask about different scenarios.
Well done video, nice work. I retired at 57, earlier than I thought I would, but the best decision I ever made. I was making insane money, but it wasn't worth it. My time and freedom is priceless. I didn't need a 25 minute video to know John/Jane could retire today if they want to with $2m in their retirement accounts and their house paid off. Like most people that work hard, and save, they are on track to die with lots of money in the bank, and they are likely not factoring in the real possibility of dying a *lot* sooner than they think. Crap happens. I live a simple life with all the toys I'll ever need, zero stress, total freedom! Also, I strongly suggest everyone begin taking SSN at age 62; don't trust the govt, its likely they will dramatically scale back SS in our lifetime, so grab that money while you can. Waiting to "full retirement age" is exactly what the govt wants you to do, they want you to die before taking anything out. Last, for early retirees, look at Obamacare for medical coverage until you reach medicare age, with subsidies its insanely inexpensive, especially if you are relatively healthy.
This is great. We are retiring this summer and just went through all this with our financial planner. We have a bit more assets but this scenario is close. You confirm everything we have been told. Thank you. Love your channel and your content, James.
James does by far the best case scenarios for retirement. No one else on youtube comes close. Both realistic examples and very clear and easy to understand.
To answer you question, yes! This video was sooo helpful and I appreciate you walking through each input and explaining how each affects the projection. You are the type of person I would like to sit across from to assist me on my path to retirement. I am a visual and audio learner and by you explaining as you show graphs, it helped me a lot. I also found the pace of your video, perfect. Thank you!
I'm 23, fairly finance savvy, and about to graduate college w an engineering degree. I found this very helpful to better understand how I'll need to think about retirement👍
( UK resident). Along very similar lines - I built a "Retirement Planning" spreadsheet in Excel. It includes all the features you mention (income from pensions, other sources such as dividends from shares or property ,tax,inflation etc) but I also added an extra expenditure sheet to allow for "one off" items on an annual basis. Examples...2024 World Cruise = £xxxx or New Car in 2025 of £yyyy or " pay for wedding in 2027 or University costs for n years for Johnny" These expenses reduce the overall savings balance and allow me to say " hey, I've always wanted to do xyz but it's expensive....what difference does it make if I do it?". I have the basic costs of running the household ( utilities, repairs, food etc with inflation), annual spend allowance for "whatever I want" and then we have the expense from the "one off" sheet. You could add in a "one off " sheet quite easily. Fortunately in the UK we don't need medicare ( although private healthcare might be a worthwhile consideration). If anything serious medical issues then it is covered. I retired at 51 eleven years ago.
It’s great to have so many good options, like this couple. I’m sure they have sacrificed for years to get themselves to this point. Also glad they have an advisor that shows them the ways to they could improve their own lives with the money, as well as how they can help the kids/grandkids. I hope my children (now adults) can be in this same situation later in life. Trying to coach them to that end. Thanks for going through this scenario.
Excellent presentation. There are two areas of concern I'd like you to address. 1) Run the scenario using the median percentage drop of investment portfolio value that had occurred in the mortgage crisis, and time it to occur in the 4th year of retirement, then project things forward. 2) Factor in say 5 years of long term nursing home memory care using a national average cost. Both of the aforementioned concerns are not rare, and can have a major impact on sustainability. There are, of course, many other rare factors that could be considered, but if all of these additional items were planned for, retirement would no longer be sustainable. Maybe add an increase in taxes (as were running national deficits), and means testing for social security benefits. Keep up the good work.
Either buy long term care insurance, or, plan to use your home as collateral for long term care, since you will likely move to an assisted living facility and won't need your house anyway. I plan to die young in a spectacular ball of fire, so won't need long term care 🙂
This is the only channel I came across on YT with actual retirement case study examples, this is Gold. I will recommend your channel to friends and may even use your services if you are fee only financial planner. THANK YOU
They have plenty of post-tax funds to manage their 1040 income to low enough levels to qualify for a very nice ACA credit, effectively eliminating their pre-age 65 (Medicare) health insurance cost. Their post-tax funds allow them to retire earlier without concerns about health insurance cost.
Thanks James for another useful video. I think basic videos like this are very helpful to illustrate how a certain portfolio could be used in retirement. In your video, you talk about stress testing it and I think that would be an excellent follow up. Additionally, tax management is very difficult in retirement and that could be the third video that you could make, using the same clients. A multi-part video with the same clients/portfolio isn't something I've seen other people demonstrate, but I think it would be very helpful to illustrate the numerous facets involved in creating and implementing a retirement plan.
I'd like to see these tools more broadly available for everyone to model and change over time. This is an Awesome video - while I was aware of this - THANK YOU for providing this information to everyone!
This is a wonderful video James! Thank you for making it. I'm 49, want to retire at 62, net worth today of 3 million, $2 million liquid. I'm terrified of 3 things, inflation from continued reckless government spending, social security longevity, & healthcare costs. I'm afraid we won't ever have enough since I don't have a pension.
I am not sure if your house is paid off or not, but I am 58 and have retired in similar position. Healthcare cost is the white elephant for everyone that retires prior to reaching medicare age. The rule of 55 for your 401K should enable you to retire at 55. I did this at 57, and will live off of 401K draw downs while I wait for my IRA to become available at age 60.
This is very helpful! One thing that seems very related and that I never seem to see on this or similar channels though, is a model for what the withdrawals themselves might look like. I know it's going to be highly dependent on what an individual/couple is invested in specifically of course...but in very general terms, how might harvesting that 3.8% in the first year look like for John and Jane Sample? Where would the money likely come from -- Who's IRA? Or the join account? etc? And would they sell/withdraw monthly? Or at the beginning of the year? As needed? Weekly? What general guidelines should they use to determine what to sell if it is coming directly out of investments and not liquid cash? Riskier/speculative investments first? Or more conservative ones first? If there are stocks and bonds in the mix -- should it be one or the other first?
James this is very helpful. I just retired in December at age 61+ and my financial planner did a similar scenario for me. I too wanted to plan for travel and other personal needs in the future. I am lucky that my employer has a retirement medical plan so the cost is more than when I was working, but much less than COBRA and is a great plan until I qualify for Medicare.
Their healthcare is going to be more than 7.5 percent of their agi, and could be deductible. They also have 500k in saving that only pay capital gains, so $3k in taxes is fairly reasonable.
Thanks, James, I love your clear presentations, and your mindset with regards to retirement planning. I do have a concern for folks when their financial plan timeline ends at 90 years of age. I am a physical therapist who has specialized in geriatrics during my career. I have been lucky enough to work with many patients well into their 90’s, and I can’t remember one who didn’t express surprise that they’d lived that long. I think an interesting adjustment for a couple like this would have been to extend their lifespan, and make sure that the various scenarios would still be successful. (My own plan assumes my wife, who is blessed with great genes, lives until 101…)
Great point on longevity. But the real financial kicker is: what will your monthly expenses be if you have to move from your home into a LTC facility? (Yes, the home equity could pay for a lot of that, but imagine if you had to pay for care from age 85 to 95.)
@@RootFP I always project my Portfolio til my 110th birthday. Yes people are living longer, No I don't expect to make it 110 but what if? Also, like most, I'd like to leave a legacy so approaching it this way, allows my money to outlive me. Dying with Zero is nice, I suppose, but I'd rather die knowing my family is secure.
Now a day, what car can you buy for $35k? Evan a Honda Accord is around $40k now. Also, $18k is bare two round trip first class tickets to Europe. Budget that for vacation will not be enough.
I retired. at 62. I’m similar situation to the people you’re discussing on this video. I do find that healthcare is astronomically expensive in this country. I’m originally from the United Kingdom and it shocks me that healthcare cost close to $2000 a month for basic healthcare that’s not even good coverage with UHC and aetna. Come March 2025 I’ll hit 65 and I’m gonna be on Medicare even though my old company AT&T offers a Medicare plan through UHC, which I will not take as they are a for profit company where they will increase cost of the medical plan if their stocks starts to suffer. AT&T pays their own medical bills…so self insured. That all said, I have actually since retiring at 62 have not spent a penny of my original IRA and actually have $200 K more than what I started with so things are working out pretty good. Once I receive social security at 65 (not waiting till 67 as the breakeven is age 82) I can start to use that monthly income for travel. All my cars are paid for and my three boys college is taken care of…only the mortgage payment and utilities at this point. Great video and always enjoy your content. TY
I just switched up my Roth IRA to 50% SCHD, 25% SCHX, 25% SCHG, and my Roth 401k is 70% vanguard S&P 500 index, 20% vanguard growth index, and 10% vanguard international index. Seeking best possible ways to grow $350k into $1m+ before retirement in 3 years.
I like the scenarios you show James, so great job. A couple of things I noticed in this scenario is that an assumed $18,000 for 3 trips a year is way low, particularly if you want to travel international. I would double or triple that budget for international travel which we enjoy doing. Also, their projected cost to buy a new car every 5 years seemed low as well. The canundrum for deciding when to retire is difficult because it isn't easy to precisely predict expenses. It's critical to really think thru how much money one wants or needs to spend before deciding to retire since having to go back to work due to underestimating expenses would not be pleasant and could really impact one's life negatively. Love your videos and enjoy your thoughtful approach to planning for retirement! Thanks!
Agreed on the vacation comment. Many people budget it "light vacations" in their normal monthly expenses. Then we we add in a vacation budget it's actually an "extra vacation" budget that's on top of what could normally be funded from monthly cash flow. That's what we were doing here.
I agree that predicting expenses 10-20 years out on just applying an inflation percentage is really difficult. My homeowners and car insurances have gone up 25-35% in 1-2 years so how you you accurately project those and others like it? Plus a car for 35k 10-15 years down the road will be a used car! Listen I think he is great and his presentations skills are awesome but there is no cookie cutter software unless you really pad your future expenses to compensate for the unexpected!!
We are evidently related to the “samples” and have a similar financial setup in this, our first year of retirement. The car budget made me laugh…the low amount allocated wouldn’t even buy a decent bottom tier new car, much less a good, reliable car. The excess travel budget is also too small for even moderate budget level overseas trips unless they plan to spend that $18k for a bang-up one week trip abroad, a one month modest trip abroad, or a 2-3 month backpacker budget type trip abroad. Travel prices have gone through the roof post-virus. Overseas airfare 3x higher than what it was in 2021. We had to up our retirement travel budget to an extra $30k per year for our first 5 retirement years (I have health issue and a VERY short lived family so we are greatly compressing our travel window). We are budget travelers by choice and are shocked at how little we are getting for the money. We live near Orlando. Just flying our 3 grandkids down (they live 1 state away, not cross country) for 5 days spring break and staying at a modest hotel with them, eating modest meals and going to only 1 theme park for 1 day is going to cost us about $5000! We also rent a cabin in a rural mountain community with them for a week of summer vacation and outdoor fun. The cabin has DOUBLED in price in the past 3 years. we have prioritized making memories with them while I am still here, but boy is it a budget buster. We are fortunate that we love where we live and have a fulfilling daily life in our home, community, and the surrounding natural bounty Florida offers us from coast to coast. That keeps our everyday recreational budget closed to zero.
This detail is fantastic! Liked and subscribed. Thank you fir sharing. About to turn 54 and really starting to think about retirement and have been learning and planning. Hopefully ready in 8-10 years.
I think 6.5% is quite ambitious as a long term rate of return for the investment portfolio. Of course, we all want that to be true or even a better number, say 8, 10 or 12% per year. But what if markets don’t perform well over the next few decades? Assuming that a US-centric portfolio will be as exceptional compared to other international markets, starting from today’s rich US valuations, as US returns have been over the last 50 or 100 years bakes in very optimistic assumptions. I believe that returns in the 4 to 5% range make planning like this a lot safer. It doesn’t yield the answers we all would like to see, but I think it is more prudent. I personally retired nine months ago at age 70, and maximized my Social Security, defined benefit pension and investment portfolio in the process. None of us has a crystal ball which will tell us how long we will live or how our investments will perform. My own temperament has guided me toward more conservative assumptions which do help me to feel less worried about the decisions I’ve made.
Also, inflation. Inflation over 20 years may not actually beat market growth. Consider someone who retired in 1975 (when median HOUSEHOLD income was around 14k/year) trying to live in 1995. The market boomed and busted several times between 75 and 95, and growth was not great when held next to inflation and the difference in median household income was more than double (34k/year household)
@@fortusvictus8297 Good point to bring up. If they invested in the s and p 500 from 84 to 94 it doubled without the dividends reinvested. The first index fund started in Dec. 31 1975, so it's not likely a normal person would have been in that at that time. A 10 year treasury was paying 8.75% in 1975, then in 1985 it bounced between 9.25 and 10.25%, depending on the month of 1995 it was 6.25 and 7.5%. So ya they would be doing pretty well. It's not as doable with our 15 year high of 4.75% in 2023 and most of the 2010s it was around 2-3%, so you had to be in stocks to make any money.
Really informative. Great review and how to plan to spend thru the years. I’m on that edge to retire but fret the medical costs and ability to enjoy life too. I’ll be 63, wife is 59.
Even if you have the money, don’t cripple your children by paying for their college, homes and cars. Learning from those life experiences is priceless.
I make $350k and my parents bought me a car so I could go to school and get an education. A boost early in life is better than getting an inheritance when you're 70 year sold.
it's good to show how the sausage is made. so yes, it does help going over the numbers. you touch on a lot of key caveats that shouldn't be overlooked.- well done..... I am in retirement and i especially enjoy you pointing out its not about the money, it's about the life we need to have
Hi James, have you projected the elderly care costs when they turn to 83 years old? Assume the couple want to go to assisted living or a nursing home after turning 83, what their financial outcome will be? Thank you!
I agree. That would be good to include. In my mind, medical care and assisted living cost the biggest unknown and I would think probably be the biggest impact on the 'stress test'
Great video! Your approach to covering all the bases in retirement and being able to run multiple scenarios is extremely helpful. I am currently 53 and retirement is on my mind constantly. I am reviewing your planning academy and feel like it could help me see some of the missing pieces of the retirement puzzle. Thanks for putting out high quality content. By the way I have just started following your podcast!!!
This was an AWESOME video - my wife and I planned goal is to retire comfortably by age 60 (we are both mid-40's). This video definitely helped set realistic expectations on that endeavor!
Very helpful James. Most people worry about running out of money but end up with a greater net worth at the end of their life vs. when they retired. I think the biggest fear now is excessive inflation. Our federal govt spends like a drunk soldier every year so that is a big threat to those in retirement.
Built a real estate portfolio that generates about $240K per year. Portfolio income of $65/yr from dividends. Both of us like to sell options for an additional $40K or so per year. Some SS that I never thought was going to be around at 62. Total outflows about 50% of our income. No debt.
this was a wonderful video, i really really learned a ton. i am 29 but i love looking at the analytics and statistics involved in saving and retirement. my goal is to retire by 45
And suicide by 55? As someone who was involuntarily (medically) retired at 38 from my career with no viable plan B career, don't be in a hurry to retire. Task and purpose really matter. So many of my buddies who are now retiring 'normally' at 45 are falling apart fast and some have already quit life. Retirement is not something to rush towards, I don't have many answers but I know that from my own experience and that of my peers going through it now.
This video helped me, and it tells me I already have a good plan setup myself in my spreadsheets. It gives me more confidence that if/when I do consult a planner (finding one who isn't selling something is hard), I'll already have most if not all the answers they would be telling me. My assumptions are similar, I don't have Monte Carlo access for a stress test, but I take the opposite approach, where I withdraw from my portfolio with the goal of hitting $0 by the time I'm 93...I end up withdrawing far more than I need. I also don't have a good tax assumption...I use a fixed percentage every year. Thanks for giving me confidence that I'm already on the right track!
OMG! This is amazing! Thank you! I have to see the video again but it looks like you did not account for taxes just after retiring, but I assume you were using their Roth for that. Thank you!
this is incredibly helpful! I am in my 50s, and had to start managing my mother's money for her this year. Seeing what Mom and Dad did right and where they made mistakes, and making sure her rate of withdrawals is sustainable, has been great practice for my own future retirement.
Very helpful video. You walk through your structured thinking clearly and stepwise. It’s great when you call out what the major drivers are in your analysis
You’re doing exactly what I dream of. I’m retiring in about 12 years. I’m investing almost 25% of my salary. I’m going to own a little house in the country side and grow a garden. Have the family over and just enjoy life.
$1K / month for EACH for healthcare??? My wife and I are 55 and spend approximately $0 / year on healthcare and don't see that changing very much in the future. With the exception of gym membership and supplements.
And if your state has a good healthcare exchange like my midwestern state, you might be suprised how much lower your costs can be. I lost my wife 2 years ago and had to stop working to support my 2 daughters. I'm 60 and filing as head of household. Yet my healthcare for the 3 of us is basically zero because I'm drawing only 30k right now. That will change of course in future. But worth looking into your estimated now. Good luck!
So I did this on my own. What I found is that we could easily retire early. I had been aggressive with saving for years and live pretty frugally. Found that I could retire at age 57. Big thing was doing a detailed spreadsheet of expenses and income. Good luck to you and I hope you find that you can retire early too.
@@ivanvarykino8202 We have some decent options in California, but unfortunately, due to our retirement income I won't qualify for any of the programs. I'll include those when working out the final numbers with my wife. Thanks.
@@TheMarpalm100% agree. I did the exact same thing and figured out what I actually needed and not what I wanted to spend. I retired last year at 54 and moved to Europe so healthcare isn’t a problem.
This is one of the closest to (our!) reality financial presentations of actual retirement planning/expenses I’ve seen on TH-cam in the last 5 years. Most content goes with industry standards, “4% rule”, or say “no one can predict what you will need in retirement”. We are looking at having to balance 2 (or 3) pensions, 401k and personal investment accounts (along with SS eventually) and are still challenged with Roth conversion rules/principles… So, if you do another video, please incorporate that as well.
James - another Great video! I love the deep dives into the projected analysis. Have you ever analyzed the impact of the GPO (government pension Offset) that a spouse would be subjected to, almost eliminating the Social Security Spousal benefit ).... does it eliminate benefits from the other partners from holding Social Security 70 years old?
Most accurate and best video period for professionals that have saved all their lives and have lived within their means. $2 million is very accurate for those ending salaries.
I like these examples that take some different amount, either a bit tight or pretty generous, amount and run through realistic spend rates in retirement. You really get a feel for what sort of spend rate may be ballpark for you by comparing the rates of different portfolio values.
First time viewer, great video! Well explained and loved all the alternate plans. This is so helpful to inform people who don't have as much fiscal knowledge
Very helpful content including the level of detail. Will look thru your content, but seeing something about how a potential client(s) should prepare to meet with an advisor would be helpful...as would information about how the advisory relationship would work...(e.g., is there an up front cost, then an annual fee, etc.)
I would suggest when they’re at ages 65 and 66 they take as much capital gains as possible from their investment account to take advantage of the 0% or 15% capital gains tax rate. And/or do Roth conversions those 2 years to help reduce future RMD’s.
This is really helpful as it verifies that my own personal planning process is right on the money. Instead of using software I made detailed spreadsheets for our specific and unique circumstances. It's interesting the effects of spending and how they either work against you or for you.
Bone up on excel and track your expenses by categories every month. Do this a couple of years in advance of retirement. You’ll be surprised on how much you spend and where.
This was very helpful to see everything laid out. I'm sure it varies by person and location, but seeing an estimate on how much to budget for healthcare was very helpful.
This is awesome. I think my wide and I are on a pretty good trajectory. We are 37 and have about $700k liquid $700k in home equity. Do you have videos on retiring at 55? Thats our goal...
Except if the breadwinner decides he no longer wants a big family and leaves for a new "career woman" wife. He played his cards and picked a stewardess. FREE world travel...cha ching! She comes with half the proceeds from her house sale and a big 401k. Trad wife is left with 11 kids who had their world destroyed and no career, no retirement, body shot from 13 pregnancies. Then since trad wife is struggling to keep head above water, always at 2 low pay jobs and doing college online, adult kids learn to get together without mom. Mom is alone with nothing. The end. Moral of the story: if you want a traditional family, get a pre-nup that spells out what happens financially if one wants out. PS I still won because I created 11 great people. #morekidsthanElon
Many of you have asked what software I'm using in these projections. The software is only available through licensed advisors, but you can get lifetime access to it in my Retirement Planning Academy here → retirement-planning-academy.mykajabi.com/rpa
Looks interesting. How much of the content is different and more specific that your TH-cam videos? I’ve watched them all😊 Will it walk us through how to input into this software?
So, for a one-time fee of $195, I get lifetime access to the Retirement planning tool used in your case study videos? Please confirm.
correct@@pglover19
Similar concepts, but the videos are different than my TH-cam videos@@karenmcgovern3452
The information in this video is exactly what i've been looking for! So just to confirm, simply by joining the Retirement Planning Academy, i'll have full access to the software tool you used in this video? even without being a client of your firm?
I retired seven years ago. When I retired I owned my own home on a five acre parcel and my truck was paid off. After utilities, insurance, taxes, food and just about everything else, my monthly cost is around $1100. Instead of focusing on how much money I need to save, I focused instead on how well can I prepare and what makes me happy. I get immense amount of joy working the land and it keeps me in shape. I have great neighbors in a community that is unbelievably good. In fact, when I dream about going on my dream vacation I think of right here where I live. If you focus on being happy and preparing sensibly, then everything else becomes trivial.
So agree!
If I had $4000/month in SS, I’d think I was in heaven!
I live on a lot less!
You’re doing exactly what I dream of. I’m retiring in about 12 years. I’m investing almost 25% of my salary. I’m going to own a little house in the country side and grow a garden. Have the family over and just enjoy life.
That is awesome to hear you have such great community in retirement!
I also have a large estate (6 acres), that has a current value of around $2.5 - $3m.. it’s fully paid off and we love the land but I’ve thought about selling once we retire (sometime in the next 3-5yrs)…. My thought is, would I be better off renting in retirement so I don’t get hit with major repairs or expenses on a home??? New HVAC can run 15-20k.. a new roof 20-30k… those would be brutal expenses in retirement…
Love it!
The right time to retire is when you no longer wish to work for a living AND you ARE POSITIVE that you can afford it.
But remember, if you leave your job without sufficient resources, you are not retired, you are unemployed.
This was great. I appreciate your soft calm voice and the absence of annoying sponsors and pushing for subscribers and likes. Generally classy. Thank you!
I appreciate that! Thanks for watching.
My thoughts exactly
Yes, case studies such as this are very useful. Keep ‘em coming!
Will do, thank you.
Great presentation. We have for 48 years been savers. We are retired and did a similar analysis two years ago and and repeated it over and over and over again. Couldn’t believe the results. It showed that we weren’t spending enough to meet our goals and still have a fair amount to leave to the next generation. Now we are thoughtful spenders. We always thought of ourselves as middle class but it turns out we are rich 😂😂😂😂. Who would have figured. 😊
That’s awesome. What’s your approximate net worth?
On your way to retirement did you ever feel like you had any regrets of not spending more?
@@TuBui2I regret not traveling more with our three kids (now adults). At one point, we were investing $1000/month in their 529 plans and fully funded their college educations. You can’t predict your future income level when in your 20’s. You also can’t predict how far you’ll advance in your career, i.e. working your way into management. We never imagined our salaries would be as high as they eventually were.
The most impactful thing I've heard is that planning is very important, and it is 100% guaranteed that your plan will be wrong, but by doing the planning you learn what levers to pull to effect things so you can adjust your life to fit the circumstances.
You don't need a 2 million dollar portfolio. You can live well on $30,000 per year as long as your house is paid off and you have good medical insurance.
You may *want* a 2 million dollar portfolio but you don't *need* one.
With 2 million, they can quite reasonably live on $100,000 per year the rest of their lives. Even at 2% returns (and you can get 4.8% today). $100,000 in *spending* money is equivalent to having a $150,000 salary. And when you consider the cost of working*, it's more like having a salary of $175,000.
* Extra car wear requiring a new car twice to thrice as often, fuel, extra wear on more expensive clothing, dry cleaning, lunch out...and likely buying prepared food for dinner *and* breakfast often because you are too tired from working.
Seriously, retired on much less, vacation 4 weeks a year (skiing which isn't cheap), still eat out 15 times a month, someplace really nice once a month, buy $600 worth of new clothes per year, etc. I'm now retired 12 years. I still have enough assets to last the rest of my life tho the recent burst of inflation *did* hurt a bit (I'd say it cut my fun money by 10% per year).
James, I’m 57 and I have been watching videos about retirement on TH-cam endlessly. This was by far the most informative and helpful. At least it will help me to initiate conversation with the financial advisor and ask about different scenarios.
Well done video, nice work. I retired at 57, earlier than I thought I would, but the best decision I ever made. I was making insane money, but it wasn't worth it. My time and freedom is priceless. I didn't need a 25 minute video to know John/Jane could retire today if they want to with $2m in their retirement accounts and their house paid off. Like most people that work hard, and save, they are on track to die with lots of money in the bank, and they are likely not factoring in the real possibility of dying a *lot* sooner than they think. Crap happens. I live a simple life with all the toys I'll ever need, zero stress, total freedom! Also, I strongly suggest everyone begin taking SSN at age 62; don't trust the govt, its likely they will dramatically scale back SS in our lifetime, so grab that money while you can. Waiting to "full retirement age" is exactly what the govt wants you to do, they want you to die before taking anything out. Last, for early retirees, look at Obamacare for medical coverage until you reach medicare age, with subsidies its insanely inexpensive, especially if you are relatively healthy.
yep, you got it all figured out.
I absolutely love real life scenarios and how you take us step by step through the analysis. Very informative and helpful as always!
This is great. We are retiring this summer and just went through all this with our financial planner. We have a bit more assets but this scenario is close. You confirm everything we have been told. Thank you. Love your channel and your content, James.
Wonderful!
James does by far the best case scenarios for retirement. No one else on youtube comes close. Both realistic examples and very clear and easy to understand.
To answer you question, yes! This video was sooo helpful and I appreciate you walking through each input and explaining how each affects the projection. You are the type of person I would like to sit across from to assist me on my path to retirement. I am a visual and audio learner and by you explaining as you show graphs, it helped me a lot. I also found the pace of your video, perfect. Thank you!
I'm 23, fairly finance savvy, and about to graduate college w an engineering degree. I found this very helpful to better understand how I'll need to think about retirement👍
( UK resident). Along very similar lines - I built a "Retirement Planning" spreadsheet in Excel. It includes all the features you mention (income from pensions, other sources such as dividends from shares or property ,tax,inflation etc) but I also added an extra expenditure sheet to allow for "one off" items on an annual basis. Examples...2024 World Cruise = £xxxx or New Car in 2025 of £yyyy or " pay for wedding in 2027 or University costs for n years for Johnny" These expenses reduce the overall savings balance and allow me to say " hey, I've always wanted to do xyz but it's expensive....what difference does it make if I do it?". I have the basic costs of running the household ( utilities, repairs, food etc with inflation), annual spend allowance for "whatever I want" and then we have the expense from the "one off" sheet. You could add in a "one off " sheet quite easily.
Fortunately in the UK we don't need medicare ( although private healthcare might be a worthwhile consideration). If anything serious medical issues then it is covered.
I retired at 51 eleven years ago.
After a lifetime of being cautious, it is difficult to spend it!
It’s great to have so many good options, like this couple. I’m sure they have sacrificed for years to get themselves to this point. Also glad they have an advisor that shows them the ways to they could improve their own lives with the money, as well as how they can help the kids/grandkids. I hope my children (now adults) can be in this same situation later in life. Trying to coach them to that end. Thanks for going through this scenario.
John and Jane Sample are killing it!
Excellent presentation. There are two areas of concern I'd like you to address. 1) Run the scenario using the median percentage drop of investment portfolio value that had occurred in the mortgage crisis, and time it to occur in the 4th year of retirement, then project things forward. 2) Factor in say 5 years of long term nursing home memory care using a national average cost. Both of the aforementioned concerns are not rare, and can have a major impact on sustainability. There are, of course, many other rare factors that could be considered, but if all of these additional items were planned for, retirement would no longer be sustainable. Maybe add an increase in taxes (as were running national deficits), and means testing for social security benefits. Keep up the good work.
I think this is the best retirement analysis I've ever seen. Incredibly helpful. Thank you!
I’m 77 and retiring this year. This was very helpful!
Joe Biden?
77 is 17 years to late
Very, very well done! There are many CFP/CPAs who present this, and you are one of the better presenters!!
The case study does not include long-term care expenses or additional medical expenses, which are huge outflows in the future.
Exactly. If someone needs a caregiver or assisted living or memory care we are talking up to $8k per month in expenses.
Either buy long term care insurance, or, plan to use your home as collateral for long term care, since you will likely move to an assisted living facility and won't need your house anyway. I plan to die young in a spectacular ball of fire, so won't need long term care 🙂
@@repomannv😂
This is the only channel I came across on YT with actual retirement case study examples, this is Gold. I will recommend your channel to friends and may even use your services if you are fee only financial planner. THANK YOU
As usual, well done. “How do we get the most life out of our money?” Excellent!
Thank you!
They have plenty of post-tax funds to manage their 1040 income to low enough levels to qualify for a very nice ACA credit, effectively eliminating their pre-age 65 (Medicare) health insurance cost. Their post-tax funds allow them to retire earlier without concerns about health insurance cost.
Thanks James for another useful video. I think basic videos like this are very helpful to illustrate how a certain portfolio could be used in retirement. In your video, you talk about stress testing it and I think that would be an excellent follow up. Additionally, tax management is very difficult in retirement and that could be the third video that you could make, using the same clients. A multi-part video with the same clients/portfolio isn't something I've seen other people demonstrate, but I think it would be very helpful to illustrate the numerous facets involved in creating and implementing a retirement plan.
Good point. I'll look to do a follow up that shows how we stress test this.
Oh yes, this is super helpful! 🎉I feel lucky to have the ins and outs of a long range plan. Thanks for sharing.
I'd like to see these tools more broadly available for everyone to model and change over time. This is an Awesome video - while I was aware of this - THANK YOU for providing this information to everyone!
Check out New Retirement software. Extremely powerful and inexpensive
This is a wonderful video James! Thank you for making it. I'm 49, want to retire at 62, net worth today of 3 million, $2 million liquid. I'm terrified of 3 things, inflation from continued reckless government spending, social security longevity, & healthcare costs. I'm afraid we won't ever have enough since I don't have a pension.
I am not sure if your house is paid off or not, but I am 58 and have retired in similar position. Healthcare cost is the white elephant for everyone that retires prior to reaching medicare age. The rule of 55 for your 401K should enable you to retire at 55. I did this at 57, and will live off of 401K draw downs while I wait for my IRA to become available at age 60.
This is very helpful! One thing that seems very related and that I never seem to see on this or similar channels though, is a model for what the withdrawals themselves might look like. I know it's going to be highly dependent on what an individual/couple is invested in specifically of course...but in very general terms, how might harvesting that 3.8% in the first year look like for John and Jane Sample? Where would the money likely come from -- Who's IRA? Or the join account? etc? And would they sell/withdraw monthly? Or at the beginning of the year? As needed? Weekly? What general guidelines should they use to determine what to sell if it is coming directly out of investments and not liquid cash? Riskier/speculative investments first? Or more conservative ones first? If there are stocks and bonds in the mix -- should it be one or the other first?
James this is very helpful. I just retired in December at age 61+ and my financial planner did a similar scenario for me. I too wanted to plan for travel and other personal needs in the future. I am lucky that my employer has a retirement medical plan so the cost is more than when I was working, but much less than COBRA and is a great plan until I qualify for Medicare.
Congratulations on your retirement
Super helpful Thank You, not sure how their taxes are so low $3000 a year, with the majority of their retirement in taxable IRA’S
Their healthcare is going to be more than 7.5 percent of their agi, and could be deductible. They also have 500k in saving that only pay capital gains, so $3k in taxes is fairly reasonable.
Thanks, James, I love your clear presentations, and your mindset with regards to retirement planning. I do have a concern for folks when their financial plan timeline ends at 90 years of age. I am a physical therapist who has specialized in geriatrics during my career. I have been lucky enough to work with many patients well into their 90’s, and I can’t remember one who didn’t express surprise that they’d lived that long. I think an interesting adjustment for a couple like this would have been to extend their lifespan, and make sure that the various scenarios would still be successful. (My own plan assumes my wife, who is blessed with great genes, lives until 101…)
Yes good point. For many people 90 is not a long enough horizon to plan for. Thanks for the comment
Great point on longevity.
But the real financial kicker is: what will your monthly expenses be if you have to move from your home into a LTC facility?
(Yes, the home equity could pay for a lot of that, but imagine if you had to pay for care from age 85 to 95.)
@@RootFP
I always project my Portfolio til my 110th birthday.
Yes people are living longer,
No I don't expect to make it 110 but what if?
Also, like most, I'd like to leave a legacy so approaching it this way, allows my money to outlive me.
Dying with Zero is nice, I suppose, but I'd rather die knowing my family is secure.
After seeing my mom still living at 94 and my father in-law living at 96, I'm thinking I will increase our plan from 90 to 95 and 100
We had a meeting about retirement planning with a financial advisor in July and discovered we were okay. M
Now a day, what car can you buy for $35k? Evan a Honda Accord is around $40k now. Also, $18k is bare two round trip first class tickets to Europe. Budget that for vacation will not be enough.
These details are helpful to see. I definitely would recommend they contribute to Roth IRAs/401ks instead of traditional if that’s possible.
I retired. at 62. I’m similar situation to the people you’re discussing on this video. I do find that healthcare is astronomically expensive in this country. I’m originally from the United Kingdom and it shocks me that healthcare cost close to $2000 a month for basic healthcare that’s not even good coverage with UHC and aetna. Come March 2025 I’ll hit 65 and I’m gonna be on Medicare even though my old company AT&T offers a Medicare plan through UHC, which I will not take as they are a for profit company where they will increase cost of the medical plan if their stocks starts to suffer. AT&T pays their own medical bills…so self insured. That all said, I have actually since retiring at 62 have not spent a penny of my original IRA and actually have $200 K more than what I started with so things are working out pretty good. Once I receive social security at 65 (not waiting till 67 as the breakeven is age 82) I can start to use that monthly income for travel. All my cars are paid for and my three boys college is taken care of…only the mortgage payment and utilities at this point. Great video and always enjoy your content. TY
I just switched up my Roth IRA to 50% SCHD, 25% SCHX, 25% SCHG, and my Roth 401k is 70% vanguard S&P 500 index, 20% vanguard growth index, and 10% vanguard international index. Seeking best possible ways to grow $350k into $1m+ before retirement in 3 years.
James, this might be one of your best videos yet.
Great example. My wife and I are getting close to retirement, and this gives us great insight
I’m 68 planning to work till 70 - this has been very informative and d eye opening - you have integrated all variables in a concise manner. Thank you!
So helpful! This is the first time I've seen such a detailed analysis that also includes real example numbers. Thank you for going through it all!
Glad it was helpful!
I like the scenarios you show James, so great job. A couple of things I noticed in this scenario is that an assumed $18,000 for 3 trips a year is way low, particularly if you want to travel international. I would double or triple that budget for international travel which we enjoy doing. Also, their projected cost to buy a new car every 5 years seemed low as well. The canundrum for deciding when to retire is difficult because it isn't easy to precisely predict expenses. It's critical to really think thru how much money one wants or needs to spend before deciding to retire since having to go back to work due to underestimating expenses would not be pleasant and could really impact one's life negatively. Love your videos and enjoy your thoughtful approach to planning for retirement! Thanks!
Agreed on the vacation comment. Many people budget it "light vacations" in their normal monthly expenses. Then we we add in a vacation budget it's actually an "extra vacation" budget that's on top of what could normally be funded from monthly cash flow. That's what we were doing here.
I agree that predicting expenses 10-20 years out on just applying an inflation percentage is really difficult. My homeowners and car insurances have gone up 25-35% in 1-2 years so how you you accurately project those and others like it? Plus a car for 35k 10-15 years down the road will be a used car! Listen I think he is great and his presentations skills are awesome but there is no cookie cutter software unless you really pad your future expenses to compensate for the unexpected!!
We are evidently related to the “samples” and have a similar financial setup in this, our first year of retirement.
The car budget made me laugh…the low amount allocated wouldn’t even buy a decent bottom tier new car, much less a good, reliable car.
The excess travel budget is also too small for even moderate budget level overseas trips unless they plan to spend that $18k for a bang-up one week trip abroad, a one month modest trip abroad, or a 2-3 month backpacker budget type trip abroad. Travel prices have gone through the roof post-virus. Overseas airfare 3x higher than what it was in 2021.
We had to up our retirement travel budget to an extra $30k per year for our first 5 retirement years (I have health issue and a VERY short lived family so we are greatly compressing our travel window). We are budget travelers by choice and are shocked at how little we are getting for the money.
We live near Orlando. Just flying our 3 grandkids down (they live 1 state away, not cross country) for 5 days spring break and staying at a modest hotel with them, eating modest meals and going to only 1 theme park for 1 day is going to cost us about $5000!
We also rent a cabin in a rural mountain community with them for a week of summer vacation and outdoor fun. The cabin has DOUBLED in price in the past 3 years.
we have prioritized making memories with them while I am still here, but boy is it a budget buster.
We are fortunate that we love where we live and have a fulfilling daily life in our home, community, and the surrounding natural bounty Florida offers us from coast to coast. That keeps our everyday recreational budget closed to zero.
This detail is fantastic! Liked and subscribed. Thank you fir sharing. About to turn 54 and really starting to think about retirement and have been learning and planning. Hopefully ready in 8-10 years.
I think 6.5% is quite ambitious as a long term rate of return for the investment portfolio. Of course, we all want that to be true or even a better number, say 8, 10 or 12% per year. But what if markets don’t perform well over the next few decades? Assuming that a US-centric portfolio will be as exceptional compared to other international markets, starting from today’s rich US valuations, as US returns have been over the last 50 or 100 years bakes in very optimistic assumptions. I believe that returns in the 4 to 5% range make planning like this a lot safer. It doesn’t yield the answers we all would like to see, but I think it is more prudent. I personally retired nine months ago at age 70, and maximized my Social Security, defined benefit pension and investment portfolio in the process. None of us has a crystal ball which will tell us how long we will live or how our investments will perform. My own temperament has guided me toward more conservative assumptions which do help me to feel less worried about the decisions I’ve made.
Also, inflation. Inflation over 20 years may not actually beat market growth. Consider someone who retired in 1975 (when median HOUSEHOLD income was around 14k/year) trying to live in 1995. The market boomed and busted several times between 75 and 95, and growth was not great when held next to inflation and the difference in median household income was more than double (34k/year household)
@@fortusvictus8297 Good point to bring up. If they invested in the s and p 500 from 84 to 94 it doubled without the dividends reinvested. The first index fund started in Dec. 31 1975, so it's not likely a normal person would have been in that at that time. A 10 year treasury was paying 8.75% in 1975, then in 1985 it bounced between 9.25 and 10.25%, depending on the month of 1995 it was 6.25 and 7.5%. So ya they would be doing pretty well. It's not as doable with our 15 year high of 4.75% in 2023 and most of the 2010s it was around 2-3%, so you had to be in stocks to make any money.
I think the detail in this video is great. You have modeled almost exactly my situation to almost the last $. Loved seeing it.
Glad you enjoyed it!
Really informative. Great review and how to plan to spend thru the years. I’m on that edge to retire but fret the medical costs and ability to enjoy life too. I’ll be 63, wife is 59.
James, love the detail of your videos, but I think it would be easy to cut the length in half. Still get your point across and save everyone time.
Even if you have the money, don’t cripple your children by paying for their college, homes and cars. Learning from those life experiences is priceless.
I make $350k and my parents bought me a car so I could go to school and get an education. A boost early in life is better than getting an inheritance when you're 70 year sold.
it's good to show how the sausage is made. so yes, it does help going over the numbers. you touch on a lot of key caveats that shouldn't be overlooked.- well done..... I am in retirement and i especially enjoy you pointing out its not about the money, it's about the life we need to have
Thanks for watching!
Hi James, have you projected the elderly care costs when they turn to 83 years old? Assume the couple want to go to assisted living or a nursing home after turning 83, what their financial outcome will be? Thank you!
I agree. That would be good to include. In my mind, medical care and assisted living cost the biggest unknown and I would think probably be the biggest impact on the 'stress test'
Very insightful, could you explain a little more how you tie the financial plan with a monte carlo analysis in a video?
Great video! Your approach to covering all the bases in retirement and being able to run multiple scenarios is extremely helpful. I am currently 53 and retirement is on my mind constantly. I am reviewing your planning academy and feel like it could help me see some of the missing pieces of the retirement puzzle. Thanks for putting out high quality content. By the way I have just started following your podcast!!!
loved this! im on the back half of my 30s now and im alway crunching these numbers. loved to see such a detailed real world example
This was an AWESOME video - my wife and I planned goal is to retire comfortably by age 60 (we are both mid-40's). This video definitely helped set realistic expectations on that endeavor!
Very helpful James. Most people worry about running out of money but end up with a greater net worth at the end of their life vs. when they retired. I think the biggest fear now is excessive inflation. Our federal govt spends like a drunk soldier every year so that is a big threat to those in retirement.
I am like John. Not sure if I have enough, in spite of the math telling me that I have enough. Fear of unknown is real and goal post keeps on moving.
Very real indeed
Built a real estate portfolio that generates about $240K per year. Portfolio income of $65/yr from dividends. Both of us like to sell options for an additional $40K or so per year. Some SS that I never thought was going to be around at 62. Total outflows about 50% of our income. No debt.
this was a wonderful video, i really really learned a ton. i am 29 but i love looking at the analytics and statistics involved in saving and retirement. my goal is to retire by 45
And suicide by 55? As someone who was involuntarily (medically) retired at 38 from my career with no viable plan B career, don't be in a hurry to retire. Task and purpose really matter.
So many of my buddies who are now retiring 'normally' at 45 are falling apart fast and some have already quit life. Retirement is not something to rush towards, I don't have many answers but I know that from my own experience and that of my peers going through it now.
James so helpful would benefit from a video like this that models an earlier retirement like at 55.
This video helped me, and it tells me I already have a good plan setup myself in my spreadsheets. It gives me more confidence that if/when I do consult a planner (finding one who isn't selling something is hard), I'll already have most if not all the answers they would be telling me. My assumptions are similar, I don't have Monte Carlo access for a stress test, but I take the opposite approach, where I withdraw from my portfolio with the goal of hitting $0 by the time I'm 93...I end up withdrawing far more than I need. I also don't have a good tax assumption...I use a fixed percentage every year. Thanks for giving me confidence that I'm already on the right track!
To answer your question - very helpful! Thank you so much for all of your videos - they are very well done!
This video is extremely helpful. This detailed analysis lets me see some expenses I didn't plan for.
We are approaching retirement and this is the single best analysis I've seen in how to plan for our financial strategy. Thank you!
This is fantastic. Thank you for the level-headed analysis, with different options for different personal priorities.
OMG! This is amazing! Thank you!
I have to see the video again but it looks like you did not account for taxes just after retiring, but I assume you were using their Roth for that.
Thank you!
Obviously there are no guarantees, but this modeling and these videos are very reassuring.
Yes! It’s helpful, and not only that but you’re breaking these concepts down in a clear way that is easy for me to understand.
James,
It is very helpful example because we are in a similar situation. We enjoy all your details and analysis. Please keep up the great work!
this is incredibly helpful! I am in my 50s, and had to start managing my mother's money for her this year. Seeing what Mom and Dad did right and where they made mistakes, and making sure her rate of withdrawals is sustainable, has been great practice for my own future retirement.
Glad it was helpful!
Very helpful video. You walk through your structured thinking clearly and stepwise. It’s great when you call out what the major drivers are in your analysis
Your case analysis is very helpful! But how to achieve a growth rate of 6.5% for a retirement portfolio at age 77? This is my main concern. Thank you!
Thanks for the suggestion. I'll add that as a potential future video topic.
You’re doing exactly what I dream of. I’m retiring in about 12 years. I’m investing almost 25% of my salary. I’m going to own a little house in the country side and grow a garden. Have the family over and just enjoy life.
the best laid plans.................
$1K / month for EACH for healthcare??? My wife and I are 55 and spend approximately $0 / year on healthcare and don't see that changing very much in the future. With the exception of gym membership and supplements.
Careful what you crow about. The next ten years may not be the same as the last ten.
This is a great explanation and allows me to think of additional questions. Thank you
100% helpful. Really enjoying the in depth analysis.
I like it and want to use this to convince my wife that we don't have to work until 65 to cover our medical costs.
And if your state has a good healthcare exchange like my midwestern state, you might be suprised how much lower your costs can be. I lost my wife 2 years ago and had to stop working to support my 2 daughters. I'm 60 and filing as head of household. Yet my healthcare for the 3 of us is basically zero because I'm drawing only 30k right now. That will change of course in future. But worth looking into your estimated now. Good luck!
So I did this on my own. What I found is that we could easily retire early. I had been aggressive with saving for years and live pretty frugally. Found that I could retire at age 57. Big thing was doing a detailed spreadsheet of expenses and income.
Good luck to you and I hope you find that you can retire early too.
@@ivanvarykino8202 We have some decent options in California, but unfortunately, due to our retirement income I won't qualify for any of the programs. I'll include those when working out the final numbers with my wife. Thanks.
@@TheMarpalmlet’s not remain frugal and end up with 50 millions at the end.
@@TheMarpalm100% agree. I did the exact same thing and figured out what I actually needed and not what I wanted to spend. I retired last year at 54 and moved to Europe so healthcare isn’t a problem.
This is one of the closest to (our!) reality financial presentations of actual retirement planning/expenses I’ve seen on TH-cam in the last 5 years. Most content goes with industry standards, “4% rule”, or say “no one can predict what you will need in retirement”. We are looking at having to balance 2 (or 3) pensions, 401k and personal investment accounts (along with SS eventually) and are still challenged with Roth conversion rules/principles… So, if you do another video, please incorporate that as well.
James - another Great video! I love the deep dives into the projected analysis. Have you ever analyzed the impact of the GPO (government pension Offset) that a spouse would be subjected to, almost eliminating the Social Security Spousal benefit ).... does it eliminate benefits from the other partners from holding Social Security 70 years old?
Most accurate and best video period for professionals that have saved all their lives and have lived within their means. $2 million is very accurate for those ending salaries.
I like these examples that take some different amount, either a bit tight or pretty generous, amount and run through realistic spend rates in retirement. You really get a feel for what sort of spend rate may be ballpark for you by comparing the rates of different portfolio values.
As you point out using a constant market return is too simplistic, you should cover the stress testing
I’ll create a follow up that goes over stress tests for this
First time viewer, great video! Well explained and loved all the alternate plans. This is so helpful to inform people who don't have as much fiscal knowledge
Welcome aboard!
I listen to your podcasts all the time, and this is a great example and very useful to me...Thanks!
Great video. The detailed scenario that you show on screen is perfect. Clearly I need to give you a call.😊
Very helpful content including the level of detail. Will look thru your content, but seeing something about how a potential client(s) should prepare to meet with an advisor would be helpful...as would information about how the advisory relationship would work...(e.g., is there an up front cost, then an annual fee, etc.)
I would suggest when they’re at ages 65 and 66 they take as much capital gains as possible from their investment account to take advantage of the 0% or 15% capital gains tax rate. And/or do Roth conversions those 2 years to help reduce future RMD’s.
Love the scenario posts. Perfect length.
This is really helpful as it verifies that my own personal planning process is right on the money. Instead of using software I made detailed spreadsheets for our specific and unique circumstances. It's interesting the effects of spending and how they either work against you or for you.
Bone up on excel and track your expenses by categories every month. Do this a couple of years in advance of retirement. You’ll be surprised on how much you spend and where.
This was very helpful to see everything laid out. I'm sure it varies by person and location, but seeing an estimate on how much to budget for healthcare was very helpful.
These detailed examples are very helpful. Thanks, James!
Glad you like them!
That intro is perfect. Here is a problem, here is how it is - next slide.
Just feedback from my personal opinion.
Thank you
I think you need to break down the monthly expenses. I think $6k per month on expenses is crazy for someone with no mortgage or car payments.
I would have to re watch the video but I believe their scenario includes 1K each for health insurance (until 65) and a lot of money to travel.
This was my favorite of all of your videos.
This is a great video. I appreciate how clearly you articulated the different options available to them.
This is awesome. I think my wide and I are on a pretty good trajectory. We are 37 and have about $700k liquid $700k in home equity. Do you have videos on retiring at 55? Thats our goal...
Best hedge is to invest in a large family/kids and raise them with traditional values. Id expect things to get very bumpy over the next 20-30 years
Except if the breadwinner decides he no longer wants a big family and leaves for a new "career woman" wife. He played his cards and picked a stewardess. FREE world travel...cha ching! She comes with half the proceeds from her house sale and a big 401k. Trad wife is left with 11 kids who had their world destroyed and no career, no retirement, body shot from 13 pregnancies. Then since trad wife is struggling to keep head above water, always at 2 low pay jobs and doing college online, adult kids learn to get together without mom. Mom is alone with nothing. The end. Moral of the story: if you want a traditional family, get a pre-nup that spells out what happens financially if one wants out. PS I still won because I created 11 great people. #morekidsthanElon
😂😂😂
This is my first time seeing your content, and I want to say you are a phenomenal presenter of information.
This particular video was very helpful because it runs thru the real life numbers and situations we can face.