In this short video, Shane Tenny, CFP® and Managing Partner at Spaugh Dameron Tenny, shares five essential considerations for anyone beginning to think about retirement.
Rather than starting with investment accounts, Shane highlights the importance of understanding your lifestyle, planning for longevity, evaluating income sources, aligning assets, and preparing for unexpected health costs. His framework helps you focus on the questions that matter most so you can build a retirement plan that feels both secure and fulfilling.
Dive deeper into this topic by reading the related blog - 5 Factors to Consider When Planning for Retirement
Transcript:
[00:00:07.590] Hi there, Shane Tenny, managing partner at Spaugh Dameron Tenny, and today I want to talk to those of you who are beginning to think about retirement. You're beginning to realize, you know, it's not as far away as it used to be, and I wonder where to get started. Well, a quick Google search will lead you down rabbit holes around things like Social Security, or Medicare, or even 401(k) withdrawal rates. And all of that is important, but perhaps just a step premature.
[00:00:37.930] As you begin to start thinking about retirement, I want to offer 5 key topics that are really important to bring to mind.
[00:00:44.950] The first thing you want to think about in retirement actually is not your investment portfolio. The first thing is your standard of living and your expenses. How much does it cost to live the way you like to live? In retirement, we often talk about the go-go years, early while you're healthy.
[00:01:03.590] Shane Tenny: The slow-go years, after you've traveled and done the things you wanted to do.
[00:01:07.980] And then the no-go years, when health declines and we become more sedentary. The cost to maintain a comfortable lifestyle in each of these stages can be different, but it's very important to have an idea of what does it cost to live the way you want to live as you anticipate retirement.
[00:01:25.590] Now, the second key factor, which gets very little attention, is longevity.
[00:01:30.550] How long do you expect to live this way? Do you have longevity in your family, and the probability of living into your 90s or even hundreds? Or is it likely retirement may only last 10 or 20 years for you?
[00:01:43.530] It's very important to have an idea of how much you'll need to spend, and how long you'll need to spend it as you anticipate retirement.
[00:01:51.080] The third category is now income. What money might already be coming in as you anticipate stopping work? Will you have Social Security income? Is there a pension? Or a deferred compensation plan? Do you have rental income? Or do you anticipate selling real estate or a business that will generate income?
[00:02:10.680] All of these are important so you can determine the deficit, or the difference, between the income that will exist and the expenses that you'll have.
[00:02:19.420] Which leads me to the fourth category, and that's where most people begin thinking. That is your assets.
[00:02:26.260] What will you have available to meet your income shortfall?
[00:02:30.630] 401(k)s, Roth IRAs, investment portfolios, or, as I mentioned a minute ago, the sale of a business. All of these can be used to help meet the shortfall of your expenses for the amount of time that you need it to last.
[00:02:45.240] And then the fifth category is surprises, in particular, your health.
[00:02:50.790] As we age, our health inevitably deteriorates, and one of the most significant things that can derail an otherwise well-planned retirement is a deterioration in your health that requires either assisted living, or a nursing home, or perhaps even just the intentional move to adult living.
[00:03:09.270] Anticipating this cost and the length of it, in addition to your lifestyle, can be very important as you begin thinking about major pieces of retirement planning.
[00:03:20.170] I hope this is helpful. Stay tuned to our blogs and our website for more information, and I'll see you back here next time.
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