by Joe Hearn | Aug 26, 2013 | Lifestyle Design, Retirement
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Time: The early years.
In the years after you’re born, the passage of time seems to open doors and present you with new opportunities. At first you can’t do anything but mess yourself and cry when you’re hungry. Then a little time goes by and voila, you’re walking. A little more time and you’re talking. Before you know it, you can drive and you’ve got a curfew that lasts until the small hours of the morning. You make friends, get involved in extracurricular activities and gradually gain more freedom and control in your life (assuming you don’t make any decisions that cause mom and dad to take that freedom away).
Once you cross into adulthood and become a functioning member of society, you wake up one morning and you realize that “Time” has quietly opened all of the remaining doors and you’ve got the freedom and opportunity to do just about anything you can think of. It’s an amazing feeling.
Time: The middle and later years.
Then a funny thing starts to happen. Not long after you can buy a house or legally take your first drink, you come to a door that’s closed. “Hmmm. That’s weird. I thought everything was open.” Looking around, you see that all the other doors are still open, so you write it off as a fluke.
But as the years continue to pass and you go about living your life, you start coming across other doors that are either slightly ajar, closed or (worse yet) locked. And that’s when you realize that rather than opening new doors, Time has started closing them.
It’s gradual, but consistent. Each year Time closes 52 doors marked “Weekends,” one marked “Christmas” and one marked “Birthdays.” You make decisions that put you into a certain career or location and the doors that you didn’t choose get closed. Your physical abilities change and doors like “Marathon” or “Learn to Snowboard” that were wide open in your 20s are now marked “Do Not Enter.” Your kids grow up and doors like “Bike Riding 101” and “Family Road Trip” quietly click shut. You lose a friend or a family member and the doors to those relationships close for good. It can all be a bit depressing if you dwell on it too much.
Not only that, but there’s a certain irony to the whole situation. That’s because society has developed a process called “Retirement” whereby we go through life compiling a long Bucket List of things that we want to do only to arrive at “Retirement Age” to realize that Time has closed many of the doors that we’ll need to go through in order to do those things.
The good news is that there are ways to recognize this process for what it is and maximize your time and opportunities so you can live a life of few regrets. On Thursday of this week, I’ll publish Part 2 of this email with some practical ideas on how to do just that.
Have a great week!
~ Joe
by Joe Hearn | Aug 12, 2013 | Lifestyle Design, Pursuits, Retirement
In the 1950s, basketball had a problem: It was boring. So much so that NBC passed on airing the finals because they didn’t think anyone would watch. Why was it so boring? At the time, there was no requirement for players to shoot the ball. When a team got ahead, they would do everything possible to slow the game down and burn time off the clock. They would dribble, pass and basically play a grown up version of keep away.
By 1953, fans, coaches and owners had had enough. Enter Danny Biasone. He was the owner of the Syracuse Nationals. He felt that games were most exciting when each team scored at least 80 points. He looked at the statistics and found that it took teams an average of 60 shots to get to 80 points. With two teams per game, that’s 120 shots. The games were 48 minutes long or 2,880 seconds. Divide that by 120 shots and you get 24 seconds per shot.
He took his math to the league and “Voila!”, the 24 second shot clock was born. No longer could teams hold the ball and run time off the clock. Once a team got the ball they had 24 seconds to take a shot. How did this change the game?
- It was much faster paced and exciting
- Scoring went up dramatically
- Attendance jumped 40%
- Players had to get faster and stronger
- NBC began airing the finals
- A win was usually always in reach because games went to the last second
What does this have to do with retirement?
Too often we treat time like it goes on forever. If we aren’t under any pressure to do the things that are important to us, we dribble and pass, but we don’t shoot. We get bogged down in daily life and tell ourselves that there will be time for that “Someday.” Meanwhile, the clock keeps ticking down, down, down. If life were a game, the fans would be booing and asking for a refund.
What’s the solution? Institute your own version of the shot clock. Decide what you really want out of life and then force yourself to take action on those things on a consistent basis. Maybe your clock is based on time, money or some other metric. Whatever it is, set it up so that it is consistently forcing you to “take the shot.”
Maybe that’s taking a trip every 6 months or learning a new skill every 30 days. Maybe it’s setting up a weekly date night with your spouse or calling your kids every Thursday. Whatever it is, set it up and stick to it. If you do, your life will be richer and more interesting. You won’t procrastinate as much. You’ll take more shots, have more wins and be more fulfilled.
Remember that retirement is not based on age or assets, it’s based on control. We’re all at least partially retired because we all control a certain percentage of our time right now. What are you doing to make sure that you are a good steward of that time? What is your shot clock?
Have a great week!
~ Joe
This post was inspired by the “Game Changer” episode of the podcast 99% Invisible. Photo by Jeffrey L. Cohen and used under Creative Commons License.
by Joe Hearn | Aug 6, 2013 | Lifestyle Design, Pursuits, Retirement
Quick note: Greetings from home base (a.k.a. Omaha). I’m back home after several weeks of travel through Colorado, Oregon, Washington and Vancouver. While I get caught up, I thought I’d post an article that I wrote recently for Dow Jones MarketWatch. It has some great info on gauging your progress toward retirement, but my apologies to those of you who may have already seen it. Stay tuned for more in the coming days as I process some insights from the trip and ease back behind the writing desk.
It’s summer vacation time again and all across the fruited plain kids are pestering their parents with that age-old question: “Are we there yet?” Any answer other than “Yes” prompts the inevitable: “How much longer?”
When I was a kid, my parents would answer that question with an educated guess or just tell me to quit asking. Nowadays we have GPS devices which, as near as I can tell, use a scientific process called “Magic” to determine where you are and exactly how much longer it will be until you reach Walley World.
Wouldn’t it be nice to have a similar device that could tell you how close you are to having enough saved for retirement? Knowing where you are puts your savings into context, provides incentive and lets you know when you need to make adjustments. A trusted adviser can provide you with a detailed retirement readiness review for your unique situation, but if you want a quick, back of the envelope way to gauge your progress, ask yourself the following three questions:
What will it cost?
We all have different plans for retirement, so there’s no one answer to the question “How much is enough?” A popular rule of thumb, however, is that you’ll need about 85% of your pre-retirement income during retirement in order to maintain your standard of living.
Multiply your current income by .85. If you were to retire today, that’s approximately how much you’d need to pay the bills. For example, if you’re making $75,000 now, you could bid work adieu and get by on about $63,750 due to fact that increased spending on things like healthcare would be more than offset by reduced spending on things like taxes, 401(k) contributions and office birthday parties.
It’s important to note that the 85% Rule is a bit of a minimum standard. If your retirement plans involve things like expensive travel or hobbies, you might want to plan on replacing a greater percentage of your income to avoid running out of money. Also, if you’re many years away from retiring, you will want to adjust your income for inflation before calculating the 85% replacement ratio.
How will I pay?
Now that you know about how much income you’ll need, it’s time to take a few minutes to figure out where that money will come from. Some are lucky enough to have a pension, but most will need to rely on a combination of savings and Social Security to fund retirement.
Recent research by Aon Hewitt shows that a person will need Social Security plus savings worth about 11 times their annual income in order to hit the 85% benchmark discussed earlier and maintain their standard of living through their retirement years.
Charles Farrell did similar research several years ago and concluded that the typical person should aim to have about 12 times their annual income (plus Social Security) saved for retirement. To track your progress, he suggests having 3 times saved by 45 and 6.5 times by 55.
With that in mind, divide your assets by your income. What’s the number? If your goal is to have an asset/income ratio somewhere around 11 or 12, how are you doing? Are you on track or do you need to make adjustments (e.g. save more, change your asset allocation, work longer, downsize your plans)?
For a more detailed review of your finances, you can download a free Financial Checkup Checklist at www.intentionalretirement.com/checkup.
What will I do?
Money is important, but it’s a means to an end. As Emerson once said: “The desire of gold is not for gold. It is for the means of freedom and benefit.” I doubt that your end goal is to have a bunch of money. More likely, it is to use that money to have and do the things that bring you joy, meaning and purpose.
Your retirement is more than just a math problem. Save all you want, but you won’t truly be ready for the next phase until you have a good idea of what you want to do. Think about your ideal day in retirement. What do you want to do? Who do you want to be with? Where do you want to live? As you answer those questions, the non-financial aspects of your retirement will come into focus.
So how are you doing? Are you there yet? If so, great! Send me a postcard. If not, keep at it and continue to gauge your progress until retirement comes into view.
by Joe Hearn | Jul 22, 2013 | Lifestyle Design, Travel
“Our battered suitcases were piled on the sidewalk again; we had longer ways to go. But no matter, the road is life.”
~ Jack Kerouac, On the Road
July has been a quiet month here at Intentional Retirement because I’m spending much of it on the road. We just returned from a family trip to Colorado (3 cheers for archery, rock climbing, hiking, horse back riding, zip lining and white water rafting) and in a few days we’re leaving for a swing through the Pacific Northwest (Oregon, Washington, Vancouver and Whistler) to visit friends and cross a few more things off my 50-by-50 List. We’ll return to “regularly scheduled programming” in August.
In the meantime, I hope you’re filling your own days with fun and adventure. Remember one of the key tenets here at IR: Don’t wait for “Someday” to start living the life you truly want to live. Decide what you want out of life and then take those plans very seriously. Here are a few posts from the archives to help drive that point home:
To paraphrase Twain, at the end of life you’ll be much more disappointed by the things you didn’t do than by the things you did. Do everything you can to make sure that list of regrets is short.
Have a great week!
~Joe
by Joe Hearn | Jun 12, 2013 | Hobbies, Lifestyle Design, Pursuits
Before today’s post, 2 quick reminders:
1) Later on this morning we’re having a free Teleseminar on the ins and outs of long-term care insurance. My guest will be one of the foremost experts on LTC in the country. You’re all invited. Find call in details here.
2) If you missed Friday’s post, I just released a new eBook called A Brief Guide to Retirement Bliss. You can download a free PDF here. You can download the Kindle version here.
And now on to today’s post.
As many of you know, one of the tenets of our philosophy here at IR is that life is much more interesting if you’re always learning to do new things. Toward that end, I do periodic learning challenges and then write about them here at the site.
We’re in the process of taking our daughter to all 50 states (33 to go!) and we plan on doing some camping when we make it to places like Wyoming, Montana and Utah. To make sure we’re ready, I signed up for a six week class on camping and backpacking at the local university.
The course covered things like how to pack and dress, how to cook in the backcountry, using a map and compass, backcountry first aid, trip planning and leave no trace camping.
After finishing the class, I wanted to test out my newly acquired skills, so I bought/borrowed/rented some gear and we planned a three day camping and backpacking trip to Kansas (aka state # 18). I’ll let you know how the test run goes.
Interested in doing a similar challenge?
If camping sounds like something that might interest you, here are a few ideas to get you started:
- Sign up for classes at your local university or outdoor store
- Subscribe to Backpacker magazine. I’m not super outdoorsy, but this magazine is awesome. Lots of “how to” and inspiration.
- Get some gear. REI is a great place start. I bought their Half Dome 4 tent a few weeks ago when it was on sale. If you want to take a few trips before investing in gear, you can probably find a place to rent most of what you need. Again, the local university where I live has an Outdoor Venture Center that rents gear to students, but they also make it available to the general public. Ask around for something similar in your area.
- Plan a trip! The point of these learning challenges is to take what we learn and put it into practice by doing fun and interesting things. Once you learn some camping and backpacking basics, plan a trip and get out there and enjoy the outdoors. A good place to start would be one of the 59 National Parks in the U.S. Visit http://www.nps.gov/ to learn more.
- While we’re on the topic of National Parks, watch The National Parks: America’s Best Idea by Ken Burns. We just finished watching the entire series with our daughter. It’s available for “instant streaming” on Netflix.
What’s next?
I enjoy photography and I’m always looking to sharpen my skills in that area. A friend of mine recently introduced me to someone who is an expert in time-lapse photography. I asked him if he’d teach me how to do it and he graciously agreed. I’ll update you next month to let you know how it goes. By the way, if you’re not familiar with time-lapse, here’s a great example of it on vimeo.
Have a great week.
~ Joe
by Joe Hearn | Jun 7, 2013 | Lifestyle Design, Pursuits, Retirement
If you’ve spent any time here at IR, you know that I have a bit of a different take on retirement than most. Where others see something based on age or assets, I see something based on control. Where others see a life stage, I see a lifestyle philosophy.
After all, why should living the life you truly want to live depend on how many birthdays you’ve had or whether or not you punch a time clock? How in the world has it become acceptable to defer your dreams and push the best things in life to the very end?
I think there’s a better way and I’ve outlined it in my new ebook A Brief Guide to Retirement Bliss. Consider it the Intentional Retirement Manifesto. In it you’ll learn how to:
- Reimagine retirement
- Stop deferring your dreams
- Live the life you’ve always wanted
Sound good? Just click the cover image below to download your free copy (PDF Format) or visit the download page at www.intentionalretirement.com/bliss.
I encourage you to read it and share it with others, but most of all, I encourage you to use the principles outlined in the book to create a remarkable retirement. And after reading the eBook, feel free to check out our Retirement Toolkit for more free resources. Enjoy!
~ Joe
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