If there’s one asset class that’s become much more valuable than all of the others, it’s time. It’s finite, making it scarce. It’s fluid, making it difficult to firmly grasp. It’s misunderstood, allowing it to escape the reaches of our attempts at mastery of it. In fact, time is the very asset we’ll willingly trade all of the rest of them for. If we could only have more time.
At its core, retirement planning really is about managing time more than anything else. If you knew you didn’t have much time, you’d not need much planning in order to make your money last. If, on the other hand, you knew longevity was on your side, you’d be wise to plan very carefully for how to make your nest egg last. I’ve often shared that retirees have a very unique relationship with time; not only is there a need to plan to make your money last for a 30 or 40-year retirement, but the need for income from your assets is immediate. You have bills to pay this month, so you’d better have some funds available to meet those needs as well. All of this adds up to a fairly complex recipe: invest for later, invest for now. Both are required.
Did you know that because of time’s impact on retirement planning, I named this business Fourth Dimension? Huh? Well, if you’re familiar with 3D movies, for example, the three spatial dimensions are height, width, and depth. The fourth dimension? Time. That’s where the name came from. Fourth Dimension Financial Group got its name from this recognition of time’s unrelenting impact on the elements of planning a successful retirement. But I digress.
As you look to the many years that may lie ahead in your retirement, have you considered how time’s role can either be used to your advantage or to your detriment? Allow me to share a few thoughts that may inform how you think about time during your retirement.
- A person who put in an eight-hour day and commuted to and from work, and took two weeks vacation each year, essentially dedicated around 2,500 hours per year to maintain a job. As a retiree, how will you manage those 2,500 hours freed up from formal employment? Do you have a plan?
- Approximately 50% of retirees will need some duration and level of long term care during retirement. In fact, the average length of nursing care is just about two and-a-half years. Do you have a strategy with which to pay for this care?
- The stock market experiences a bear market decline approximately every seven years. We’re ten years removed from the crash of 2008. How will you respond to a decline when it occurs? Does your plan have provisions in place to ensure you’re still able to meet your income needs?
- If time isn’t on your side, and an untimely death occurs to you or your spouse, have you taken steps to prepare your loved ones and your assets for an orderly administration of your estate? Are your legacy wishes well understood by those you care most about?
If you’re unsure about how to respond to any of these, call or email us and we’ll help you work through it.
Time is a funny thing, often a cruel master. It sneaks up on us, leaving us to wonder where it all went. It also has the potential to drag on, begging us to do something to pass it more quickly (been in a dentist’s chair lately?). While we can’t escape time’s merciless clutches, there are some measures we can take to live well within its confines. In other words, make good use of the time you’ve been given, appreciate what you have remaining, and enjoy the journey.
All the best,
Adam Cufr, RICP®