Kitchen Table Finance

S3E17 – Retirement Planning Headlines – April 2024

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Welcome back to our much-anticipated April 2024 edition of “Retirement Planning Headlines,” where we save you the hassle of combing through endless financial articles. This month, we’ve even had listeners chime in with topics for our deep-dive discussions.

Watch on YouTube HERE

Articles Discussed in this Episode

5 Investing Mistakes Anyone Can Make | Morningstar

  • “Do as I say Not as I do” by Christine Benz
  • Where she falls short of following the advice she knows and often gives
    • Too much cash, too few bonds, slow to make contributions, too much employer stock

      • The New Math of Driving Your Car Till The Wheels Fall Off

      • With the cost of car ownership going up the case for driving a car until the wheels fall off has grown stronger
      • US vehicle average hit a record high of 12.5 years in 2023 – increasing for the sixth straight year
      • Newer models have become expensive to repair
      • Unloading your vehicle when repair costs 10% more than what you would pay for a new one.

        • Americans can’t stop ‘spaving’ — here’s how to avoid this financial trap

        • Spending more to save more – Spaving
          • This can lead to excessive spending
            • Examples:
              • Limited time deal
              • Buy one get one free
              • Free shipping after spending a certain amount
              • Spaving is us justifying our desire to buy more – Klontz
                • Teams of scientists have figured out how to extract more money from you
                • Ways to Avoid
                  • Quiet the noise – delete shopping apps and unsubscribe from newsletters
                  • Pay with Cash – Less likely to part with dollars
                  • Do the math –
                  • Steer clear of temptation –
                    • order online instead of browsing in-store.
                    • Don’t go to the grocery store hungry
                    • Create shopping “hurdles”
                      • Delete payment details to make purchasing harder
                      • Don’t create accounts buy as a guest
                      • Set time rules
                        • 24-hour rules

                          • DWS – Lots of bad math, too… retailers just re-word how they are pricing to make it seem like a deal

                          Managing Health Care Costs in Retirement

                          1. Maintain a healthy lifestyle
                          2. Boost your retirement savings
                          3. Utilize a Health Savings Account
                          4. Consider your retirement age
                            1. 62 vs 65
                              1. Live like you are already retired

                                2. DWS – Charlie Munger:

                                 “Nobody survives open heart surgery better than the guy who didn’t need the procedure in the first place.”

                                Men Who Are Truly Happy In Their Retirement Usually Adopt These Daily Habits

                                As author Ethan Sterling puts it:

                                You see, happiness in retirement isn’t about having a bulging bank account or an endless holiday. It’s about how you live your everyday life. Here’s what he found in men who successfully retired

                                1. Embrace routine
                                2. Stay active
                                3. Keep Learning
                                4. Stay socially connected
                                5. Practice mindfulness
                                6. Cherish their relationships
                                7. Make time for self-care
                                8. Embrace change
                                9. Live with gratitude

                                  10. Retirement Age 65, Most Workers Retire at 62

                                  • Most Americans believe they will work until age 65
                                  • Research shows that the majority step back from work far earlier, and not by choice
                                    • The median age is 62
                                    • 7-10 stopped working before 65
                                    • 1/3 cited health issues or disability
                                    • Only 2 in 5 did so because they could afford it

                                      • Where to Stash Your Cash

                                      • Consider liquidity, convenience, safety

                                        • 4 Finacial Worries to Cross Off Your List

                                        • Take things that might happen but are remote possibilities off the list of things you worry about:
                                          • Estate tax
                                          • Gift tax
                                          • That you’ll need hard assets to buy things (economic death spiral)
                                          • That the government will start taxing Roth IRAs
                                          • General takeaway: if it requires everything to go badly at once, or (like tax changes) political willpower to hurt the bulk of the American middle class, take it off the list. Also if it requires extreme irreversible actions (like fancy trust to avoid estate tax or buying physical gold)

                                            • Remember to subscribe and follow our podcast for monthly updates packed with practical advice to guide you through your financial future with clarity and confidence. Stay tuned and stay informed!

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                                            Kitchen Table FinanceBy David Shotwell CFP(r) and Nick Nauta CFP(r)
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