Have you ever wondered why your advisor spends so much time on all the scenarios you never expect to happen? It’s to avoid a catastrophe in retirement that ruins everything you’ve worked for or even causes you to return to work. Let’s discuss four scenarios that we’ve seen first-hand and talk about how you can avoid the same outcome.  

 

Show notes and additional resources: https://johnsonbrunetti.com/?p=4763 

 

Today's rundown: 

0:43 – A recent study finds outstanding student loans have tripled since 2006. There’s now $1.6 trillion in student loans out there. When will this become a major problem?

1:58 – Here’s how Joel’s kids have dealt with paying for college.

3:13 – Anytime there’s easy money to borrow, bubbles happen. And that’s what we have in this student loan situation. This is a real problem.

4:12 – Let’s talk about some retirement catastrophes.

4:39 – 1st scenario: Tell us a story about somebody later on in retirement that struggled to pay the bills because they didn’t do a good job accounting for inflation through the years.

6:00 – 2nd scenario: What about somebody where bad tax planning really bit them?

7:44 – Another example of this where a person bit on one of these schemes that caused a big tax burden down the road.

9:19 – A lot of people don’t see taxes as part of the retirement planning process. 

10:20 – 3RD scenario: Someone retires without having a realistic idea of how much they would spend in retirement.

12:27 – Think about retirement as 35 years of unemployment. This needs to be a part of your thinking when building a plan.

14:06 – 4th scenario: Have you seen someone that got wiped out by a market crash? Maybe they took on too much risk in retirement.

16:48 – Mailbag Question #1: I’ve been loving the growth in my 401k for several years but I just don’t know how long this ride is going to last. When should I walk away from this roulette wheel?

18:31 – Mailbag Question #2: I’ve spent 40 years saving and investing and now that I’m about to retire, I can’t comprehend the notion of taking money out now. Why does it terrify me so much?