We Take Care of it All, While You Can Enjoy Your Financial Freedom (of course you don’t want to go to your rectal examination)
Please excuse us for this title – but we are hoping to paint a picture in your head. The thing is, nobody wants to go to their rectal examination. And that’s what this blog is about. For some people, talking about finances is on par with a rectal examination in terms of their enthusiasm.
Today, we look at the interplay between hard work and good work. We have a saying here at Money Over 50: with your hard work and our good work, we can achieve great things.
Many of our new clients come to us with around $700,000 in assets and about ten years left of their working lives. Their goal is to make sure they have enough money in order to live a good lifestyle during retirement. The first question we ask them is: how much money do you spend now? This is important, because we find that nobody wants to downgrade their lifestyle once they retire. So, to know what you need in retirement, first work out what you need right now.
Many people think of their retirement savings as being one ‘bucket of money’. But how much is enough? As a very rough guide, if you want to draw $100,000 a year for the rest of your life, you want approximately 20 times that amount in your bucket (super). This equates to $2 million. If you only want to withdraw $50,000 a year, then you’re looking at $1 million. You should consider the amount you need to withdraw as a percentage – for example 5% each year – to decrease your chances of running out. What you draw will also depend on your lifestyle.
Who remembers the ad from 1994 about the average family having 2.3 children? It may be stretching the memory a little, but we clearly remember the little boy in the ad who certainly wasn’t a fan of being ‘the .3’. In the ad, he complains of never fitting in the backseat of their family car. Enter the Ford Laser – the car which all families must buy in order to fit all three kids! For a blast from the past, check it out here: https://youtu.be/jNNIJBiSyA
During an initial consultation, we always ask our clients what their goals are. It can take some time to really work out what they want to achieve in their retirement, and what financial strategies they should use. Often, the first thing new clients say to us is, “I want a good return on my investments.”
Imagine you are driving your 1999 Toyota Corolla and you pull up at the traffic lights next to a brand new Dodge Ram. You look up at the driver who is grinning at you from their shiny new vehicle, and you feel… jealous? Poor? Left behind? Well, you shouldn’t – and here’s why
When Dallas was younger, he was a keen martial arts student. After each fight, his coach would give him a Post-It note with three things on it that he needed to fix. These three points helped Dallas focus on what he needed to start working on. According to Dallas, he probably had a lot more than three things to work on, but the coach was adamant on only giving Dallas three at a time.
Michael’s son had his first day of school this year. In the week leading up to it, he was incredibly anxious about his first day – it was almost challenging to even get him into the car! But the afternoon told a different story, when he came home with a grin from ear to ear and spent the rest of the afternoon talking about how much fun school was. Life brings us many challenges – but Richie had conquered his fear.
Whenever we tell people we’re financial advisers, the first question we get asked is ‘what is a good investment?’ or ‘what should I invest my money in?
Dallas Davison, Michael Hogue and Ali Hogue.