My oldest daughter was recently married in a beautiful ceremony in Florida. After it was over, it dawned on me the number of parallels throughout this wedding planning process is shared to retirement planning. Now, to be honest, I wasn’t as involved as my wife and daughter were as I went where I was told to go. My wife and daughter invested a lot of time and energy into creating my daughter’s dream wedding. She’s doing this one time, and she wanted to make sure that it was perfect.
If you have planned for a child’s wedding, how many combined hours would you guess everyone involved put into preparing the event? The best answer I could give for our experience is countless hours. Countless. Months and months of planning to orchestrate the whole wedding weekend. In the end, it was like a great symphony coming together to play beautiful music with one conductor. Our conductor was a combination between my wife and my daughter, and it was terrific.
My point here is this. If you think about the amount of time spent for a 30-minute ceremony, evening dinner, rehearsal dinner, reception, and the number of hours that went into planning this two-day event, how many people put anywhere close to that amount of time planning for retirement? I would guess most don’t put in as much time as my wife and daughter put into planning for the two-day wedding event. Now I think people mentally think about it, but they don’t put together a plan. The problem is, thinking about it doesn’t get it done. If you think about exercising but not physically doing the workout, you aren’t going to end up in shape. I think people sometimes trick themselves into thinking that if they think about it, they’re actively working on it, but they’re not. I’m talking about physically writing and documenting things and putting together an actual written plan.
An important step that people miss in planning for retirement is creating a plan for your ideal retirement and living it. My wife’s and daughter’s goal was to create her dream wedding, and people need to think about planning for their retirement in the same way. You need to put the same amount of attention to detail into that plan. It all starts with what you want your retirement to look like. As financial planners, we need to understand the picture in these people’s minds of what they want in retirement, and sometimes that’s a long process to draw out and understand how that looks. But once we have that, we can work as financial planners and craft this plan so that it becomes a reality.
What does your ideal retirement picture look like? That’s an interesting open-ended question for people to think about. What does my ideal life look like in retirement? What is it that you want to do? How often are you going to take vacations? What are you going to do for the grandkids? Are you going to provide education? How often will you replace a vehicle? What about health insurance and taxes? How much do you want to deposit to your bank account every month so you can go live the life that you want to live? So many times, people have this fear that they don’t have enough money, and I’ve seen it multiple times. The vast majority of people coming to talk to you, we sit down, we do the planning, and we explore how they want their life to look. We put dollars into it, and then we get to work.
In some cases, I get to tell them that they could have done it two years ago or, in some cases, five years ago. They are already there financially. The look on their faces and the reactions are always the same. They can’t believe that they have been working for additional years than was needed.
I believe sometimes people get worried about coming in and talking to one of my Advisors or me because they’re afraid that they don’t have enough money. They are scared that we will tell them that it’s worse than what they think it is. Here’s an example. I had somebody come to our office that wanted to buy a second home in a warmer climate. He requested an analysis so he had an idea of how that would look. The interesting thing was how we presented both outcomes. What would the effect be if he didn’t buy the second home in a warmer climate, or he did?
It’s so important to analyze all aspects so people can make a confident decision. Can I afford to buy a condo in Florida? What’s the financial impact going to be on my overall plan? Sometimes people automatically think they can’t afford it. They can’t do it. Maybe they’re right, but maybe not. That’s just one example. I speak with clients who want to go on vacations with children and grandchildren. They want to pay for airfare, hotel, and food so that all their family has to worry about is coordinating their schedules. My Advisors and I can see if that is possible and present how that will affect your overall plan. That’s powerful stuff.
That’s why you create that dream retirement and then work on making it a reality. Where’s an excellent place to start? Click HERE to download the Retirement Plan Checklist. Click HERE to schedule a meeting with me or one of my Advisors at Osiwala Financial Group, or you can call my office at (248) 828-8000.