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Peter, hello. Good to see you. Welcome back, everyone. We are talking through six things you need to do when retirement is 6 years away. Retirement, of course, it may still be several years away, but the decisions you make now can have a lasting impact on your financial security and your lifestyle years later. So, first, Peter, you suggest trying out your retirement destination on vacation. It is wise to scope out your options as far in advance as possible. >> Yeah, and when we talk about retirement
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destination as a vacation, maybe we’re talking about an actual physical place, but maybe we’re also just talking about a state of mind here. Can we take an extended period of time off, not show up to work, and not start spinning, not not start uh getting getting a little idle hands, and and wondering what we’re going to do next? When I take vacations, I have found that about 7 to 10 days is sort of the longest that I can stand. >> I believe it. I believe it. >> active and doing something. So, we’ve
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we’ve got to know our personality and what keeps us motivated because I don’t believe we’re meant to just wake up every day with no purpose. I think that the interaction of having activity, um movement creates movement and and allows us to keep moving, and we we have to have something to get us up and out of bed in the morning. >> Mhm. Stand by for number three, then, Peter. I know that one will resonate with you. Number two, though, consider tackling those home repairs and renovations. They won’t be any cheaper
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10 years from now. >> They will not. And so, I do see people with some agendas before retiring, and I don’t know if they’re absolutely necessary, but they do help a great deal. Uh having a paid-off mortgage is something to aspire to. I think that moving into retirement, also controlling your budget by not having a mortgage payment is a wonderful thing, but also taking care of those home improvement tasks maybe that you’ve been putting off or maybe that you want in order to get
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your home ready for the duration of your life and retirement. A lot of people are are in the home that they want to stay in and they want to retire in place, but maybe the home is not outfitted exactly for aging in place. And so, not only, you know, checking the foundation and the siding and and the roof and doing all the things that just need regular upkeep. How old is the HVAC unit? Again, those things are not going to get any cheaper 10 or 15 years from now, but also how equipped is your home for aging
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in place if that’s what you plan and intend to do. So, yeah, I think that’s a big consideration. And then if if you’re not planning on on staying in the home that you are in, what are we planning for that that permanent home? And a lot of people get surprised. They they think they’re going to downsize and then save some money, but oftentimes they get what they believe is going to be their permanent home at that point in time. So, they want the latest, the greatest, the newest, the best. And
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even smaller is more expensive. >> Yeah, especially right now. All right, number three, this one is for you and everybody really volunteer. Now, this is about finding your passion, right? Building a social network outside the office and keeping busy when retired. Peter, you know, I’ve been grateful to work with you for several years now. I feel like talking to you I have learned so much about how this is so overlooked, but so important. >> Yeah, I think the majority of people when I I begin a conversation with them,
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when they come into the office, they want to review evaluation, they are thinking about the money. Which obviously is important, right? We’ve You’ve to address the financial side. But I do encourage in that meeting and often ask and dig a little bit. Well, let’s talk about what you’re going to do with your time. What What is important to you? What What does the the day, the week, the month after retirement look like? And And what are you doing to stay motivated and having purpose and drive
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and just to get yourself up and out of bed? Do you have hobbies? We can only fish or or vacation or garden so much of our time. And all of that time that used to be spent taken up by going to work now has to, you know, we have to find something to do to fill it. And again, you know, idle hands, the the rate of decline in retirement is, I think, accelerated when we don’t have something that’s motivating and pushing us. And And the rate of depression from lack of activity is probably also understated. And so we
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really do need to find some of those passions, define some some of those passions and and how we are going to use them to fill our time in retirement. >> Mhm. All right, number four, prepare now for rising health care costs, even with Medicare. And ignoring long-term care, which we both know is really expensive, retirees face huge costs for premiums, copays, and uncovered services. New research from the Center for Retirement shows that after subtracting these costs, the typical retiree has only 71%
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of Social Security and 88% of total income left. >> Right. Yeah, and they’re going to, you know, deduct those Medicare premiums from your Social Security. So that top line number that you see, it’s not often what you actually receive because those those expenses can be deducted from the Social Security. And then, you know, we we have questions about what Social Security is going to look like in 10 years. And a lot of people are claiming early, which reduces our benefit. And then what if it’s
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reduced further, and then Medicare premiums are still going to come out of that, and the cost of those premiums often goes up in tandem with the COLA on Social Security. So, healthcare is not free in retirement. It is an expense that is accelerating with with the price increases faster than almost any other category, or right there near the top, and it’s probably going to continue to do that. I I remember what I was paying for health insurance 10 15 years ago, and I’m paying a a substantial amount more these
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days. I don’t see that slowing down at any point in time, and this is something that just gets overlooked or forgotten about. So, again, the further out from retirement we can understand these factors and and plan and prepare for them, especially if we are thinking about retiring before Medicare age, because I’m dealing with couples right now that are paying anywhere from 30 to 40,000 dollars a year privately out of pocket just for the health insurance premiums. That’s not even including the deductibles, the
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co-pays, the the office visits, and things like that. So, we we’ve got to plan and prepare and understand what at least a close estimate expectation of our expenses are going to be, and that it’s going to increase over time. >> Mhm. Number five, determine when to claim Social Security. Retirees will collectively lose an estimated 3.4 trillion dollars in potential retirement income. That’s an average of 111,000 dollars per household because they claim Social Security at a financially
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sub-optimal time. That’s according to new research from Fintech United Income. Again, Peter, we’ve talked about it many times because it is so important determining your unique answer as to when you should claim. >> Thank you, and I was going to emphasize that. That is a result of individual decisions being made at a sub-optimal time, not the system as a whole. So, remember, ladies and gentlemen, if you go and claim and collect early, that is a decision that you have made on your own individual and personal benefit. It
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does impact the the spouses, the household, the married couple’s benefits during their joint mutual lifetimes as well as survivorship for a widow or widower spouse, and it it also is not including any adjustments that are made system-wide. So, if we take them at face value and they say that our benefits are going to be cut in the year 2033 or 2032, it keeps getting closer and closer and we keep getting closer to it and the amount of reduction seems to keep getting more, but if we have made a
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decision to claim and collect early and cut our own benefit by 20 or 25% and then the system has to make an adjustment. We are now, you know, subjecting ourselves to one cut and being subjected to another, but it is a double whammy and it means that more and more of our own money is going to need to be there to support the same expenses and the same lifestyle. We’re not getting as much out of that social security. So, think this one through. You have spent 35, 40 years to be entitled to all of the benefits that you
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can receive. Um, take take more than 30 seconds thinking about this. They take some time and make sure that you are making a more optimal decision with your social security cuz it can mean hundreds of thousands of dollars over the course of retirement that either comes from social security or you have to fund yourself out of your personal assets or just isn’t there at all. >> Mhm. And then last, consult a financial advisor. Why is this important? >> Early and often along the way. I mean,
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we we want to make sure we’re on track, that we understand some of the things that have maybe unfortunately caught other people off guard. They’re I I I’m always am fond of saying, you know, smart people learn from their own mistakes, but we don’t have that time or luxury in retirement. We we kind of need to be geniuses and get it right the first time cuz there’s no like do-over, oh well, I made that mistake, better luck next time in retirement. We have one shot at that ideal retirement. And
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so working with an experienced qualified professional who has seen this over and over and many times through, you’ve got the benefit of that experience that you don’t have to live first hand. And an advisor can help you spot and identify opportunities, places where things could could be improved and do better, but also risks and issues that that maybe we’re not to those yet. You know, but if there’s a detour ahead and and we can reroute now and get around it or prevent it from occurring in the
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first place, the earlier the better on that. And certainly becomes even more important as we get like five to 10 years out from retirement. We want to make sure that we’ve got a little bit more control and and hands on the wheel and that we are paying attention to those things that that unfortunately do catch people off guard, surprise, or derail retirement. >> Right, nobody wants those surprises in retirement. Peter, if somebody would like to sit down with you, talk through all of these suggestions, make sure they
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have their own, again, unique financial plan in place for their retirement, what’s the best way to reach you? >> Just give us a call at Roshan Planning and it is always a complimentary courtesy service for questions, for an initial consultation, and to get your optimized retirement plan put together, helping you address all of these factors that we’ve talked about on today’s program. So, give us a call 919-300-5886, 919-300-5886. You can also go online, roshanplanning.com. It looks like Rich
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on Planning, but it’s my last name, Roshan. roshanplanning.com. We have been voted uh of the best in wealth management uh last 2 years and and the voting is now for the third year running. So, we’re hoping to bring that that title again home from the uh readers of the News & Observer. >> Congratulations, Peter. Yeah, thank you for your time today. I appreciate it. >> Thanks, Erin. Hey folks, Peter Recession here with Recession Planning. So glad that you are enjoying the podcast Planning Matters
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strategy. You are encouraged [music] to seek investment, tax, or legal advice from an independent professional advisor. Any investments and [music] or investment strategies mentioned involve risk, including the possible loss of principal. Advisory services offered through Brookstone Capital Management, a registered investment advisor. Fiduciary duty extends solely to investment [music] advisory advice and does not extend to other activities such as insurance or broker-dealer services. Advisory clients are charged a quarterly
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