Greetings from seat 22C, somewhere over the Atlantic en route to Ireland and England.
Wow, that came up fast! When I decided last September to take our first mini retirement sometime in 2014, it seemed more like a thought experiment than an impending reality. Fast forward 9 months and I found myself knee deep in the inevitable mad scramble to finish things up and get out the door. That just goes to show you that no matter how much time you give yourself to do something, you’ll always want a few days more.
I’ll be posting pictures from the trip on my Instagram account and I’d love to have you follow along. You can either look me up (my user name is jrhearn) or just click on the little Instagram icon in the “Connect With Us” box at IntentionalRetirement.com and then click “follow.”
That’s it for today, but I’ve got several posts in the hopper, starting with one that attempts to answer some of the most common questions that I received from all of you as I prepared for this trip.
Have a great week and remember…Life is short. Be intentional.
What are you waiting for? Permission? Extra time? Enough money?
What’s holding you back? Fear? Laziness? Uncertainty?
I’ve struggled with all of those things at one time or another. In fact, I’m struggling with most of them right now as we get ready to head out on our first mini-retirement (update on that next week).
But here’s the thing. The time will never be “right.” The conditions will never be “perfect.” The things holding us back will never magically align and start flashing a giant green light.
The road less traveled will never be safe, risk free or totally clear. Sometimes you just need to go. To try. To step out and take a chance. If you don’t, that chance will vanish. “To wait” has a funny way of becoming “too late.”
When that happens, you’ll no longer have something trivial like money or fear holding you back. It will be something much harder to overcome, like your health or some other door that was once wide open only to slam shut.
So don’t wait. Your life and opportunities won’t go on forever. Someday it will be “too late.” That realization should cause you to live with a sense of urgency and to focus on the people, issues and goals that are important to you. Time will rush on. What will you do to make the most of it? What will you do to live a meaningful life and leave the world a better place?
“We are now faced with the fact, my friends, that tomorrow is today. We are confronted with the fierce urgency of now. In this unfolding conundrum of life and history, there is such a thing as being too late. Procrastination is still the thief of time. Life often leaves us standing bare, naked, and dejected with a lost opportunity. The tide in the affairs of men does not remain at flood—it ebbs. We may cry out desperately for time to pause in her passage, but time is adamant to every plea and rushes on. Over the bleached bones and jumbled residues of numerous civilizations are written the pathetic words, “Too late.” ~ Martin Luther King, Jr.
“The hardest thing in the world is to simplify your life. It’s so easy to make it complex.”
~ Yvon Chouinard, Founder of Patagonia
Minimalism and a Meaningful Retirement
I recently sat down for a conversation with Joshua Becker of Becoming Minimalist to discuss how we can simplify our lives in order to better focus on what’s important. What prompted the conversation?
I have often joked that my life resembles a Rube Goldberg machine. It gets results—food on the table, work done, semi-regular exercise, etc.—but often only after a complex and convoluted series of steps.
As you can imagine, this sometimes creates no small amount of cognitive dissonance as I try to hold the contradictory ideas of living an intentional, meaningful life while constantly struggling with busyness and complication.
I’m guessing some of you are dealing with the same problem. I don’t want retirement (or life in general) to look like the equivalent of a cluttered junk drawer, so I reached out to Joshua to get his thoughts on how minimalism can help deal with the problem. He defines minimalism like this:
“Minimalism is the promotion of things I most value and the removal of everything that distracts me from it.”
So it’s not necessarily about how many shirts you have or how big your house is. It’s about defining what’s important to you and what isn’t. Then you ruthlessly cut the latter in order to create space, time and money for the former. It’s about becoming a minimalist in the things that don’t matter so you can become a maximalist in the things that do.
What are some practical ways to do that? What are the benefits? How can we simplify life, minimize stress, and focus on what we really want out of life? Answers to those questions and more are in my interview with Joshua. You can either listen to it using the player below or, if you’d prefer, I’ve attached a PDF transcript as well. [Note: If you’re reading this in an email, you may need to view the post online in order to use the media player.]
After listening, spend a few minutes thinking about ways to clear the clutter from key areas of your own life. Your possessions are an obvious place to start, but don’t forget things like your work, relationships, obligations, finances and goals.
I’ll write more about how to simplify life in retirement in future posts, but until then, you may want to check out these articles on Joshua’s blog…
One last note. We were updating our web hosting last week and a glitch caused an email titled “Hello World” to be sent unintentionally. I apologize for the annoyance.
As we go through life, there seems to be a natural progression. When we’re young, we tend to be hungry and passionate. We have a fire in our belly. We’re willing to take risks and blaze new trails.
We accept things like moving, changing jobs and making new friends as a common part of life. We’re ok living in a humble apartment filled with less than desirable roommates and hand me down furniture. We’re ok driving a sketchy car.
In short, we’re comfortable with discomfort. Partly because we don’t know any better, but mostly because we know that the discomfort is a necessary stepping-stone on the way to something better.
Then a funny thing happens as we get older. We get a better job with a better income. We upgrade our house. Buy a better car. We get the kids into private school and take on a whole mess of responsibilities. As this happens we get less willing to rock the boat. Less willing to take a risk. We’re more willing to compromise and less willing to change because along with change comes stress, uncertainty and, most of all, discomfort.
Then retirement comes. The retirement that most of us imagine requires significant life change. We’re leaving our job. A move may be involved. We’re doing new things. Trying new experiences. Saying goodbye to some people and meeting new ones. Saying no instead of yes. Saying yes instead of no. Doing those things can be intimidating and scary. They require a certain level of discomfort.
Unfortunately, we’re at that phase in life where we’re not very comfortable with being uncomfortable. The obvious risk is that we will decide to downsize, delay or even discard our dreams for retirement. Just as we’re ready to “sail, dream and discover” we decide to keep our ship at anchor instead.
I’ve seen this phenomenon many times as I help people transition into retirement. I even see the seeds of it starting to germinate in my own life. The risk is real. So don’t get too comfortable. Stay curious and open to new things. Be ready to steer off the well-worn path of the familiar and onto the road less taken. Remember that retirement doesn’t need to wait until some far off date. Each of us can start today.
~ Joe
Photo by a200/a77Wells. Used under Creative Commons License.
I help a lot of clients with their retirement planning and anytime I come across a situation that I think we can all learn from I like to change the names to protect the innocent and then write about it here at Intentional Retirement.
Today’s installment is brought to you by the phrase “Per Stirpes.” No, that’s not a nasty disease. Per Stirpes is a Latin phrase that means “by branch” and, believe it or not, those two words are incredibly important when it comes to your beneficiary designations.
Here’s the scenario. A widow (not a client of mine, but of a colleague) in her 80s had a sizeable IRA and she named her four adult children as beneficiaries. Two of those children died unexpectedly last year and then the client also passed away at the end of the year without updating her beneficiary designations.
One of the surviving daughters was the executor of the will and she asked us to divide the IRA into four equal parts and pay each part out to the four beneficiaries or their surviving families.
Per Stirpes vs. Pro Rata
This is where our Latin lesson comes into play. When you name multiple beneficiaries (or multiple contingent beneficiaries), as this client did, there’s always the chance that one or more of those beneficiaries will die before you do.
If that happens, the language in your IRA agreement will specify what happens next. In some cases, that language will specify that the benefits should be paid Per Stirpes: To each named beneficiary OR their surviving family (i.e. their “branch” of the family).
In other cases, the IRA agreement may specify that the assets be divided on a Pro Rata basis among any surviving beneficiaries, effectively disinherited any of your beneficiaries (or their families) that predecease you.
Returning to our example, the family wanted us to divide the assets into four equal parts and distribute them to the four kids or, in the case of the two children who had died, their surviving family members. Instead, we were obligated to divide the assets into two equal parts and distribute them to the two surviving children because the IRA agreement stipulated Pro Rata instead of Per Stirpes.
“Wait,” you might be saying. “I don’t ever remember being given the choice between Per Stirpes or Pro Rata.” That’s because many IRA custodians choose one of those options (or some other option) as a default and then leave the burden on you to tell them if you want something different. To make matters worse, not all custodians choose the same default.
You can see where this could create problems and might cause you to accidentally disinherit certain branches of your family. To avoid any problems, it’s a good idea to review your beneficiary designations periodically to make sure that they are designed to accurately carry out your wishes.
Some tips for updating your beneficiary designations
Review your designations each time there is a major change in your family circumstances (e.g. birth, death, divorce, etc.).
Specify whether the designation is Pro Rata or Per Stirpes
On accounts that don’t allow beneficiaries, consider using a Payable On Death (POD) or a Transfer On Death (TOD) designation in order to avoid probate on those assets.
Coordinate your designations with your will or trust, but keep in mind that your beneficiary designations will trump your will, even if your will is more up to date and accurately reflects your wishes.
Touch base if you have any questions. Have a great weekend!
Get access to our Retirement Toolkit plus updates when new content is posted to the site. Your email will not be shared and you can opt out at any time.
