Postcards from the future--Retirement Regrets

[Ed_The_Gypsy]

Interesting article quoting people looking back:

Retirement Living: Biggest retirement regrets

"...if retirees had an opportunity to do something differently to prepare for their golden years, which mistakes would they correct?"

"There are two or three key mistakes — people planning for too early a retirement or too lavish a retirement."

"...another key mistake people make is that they fail to make provisions for catastrophic events."

" Planning can't just be for best-case scenarios, and far too often it is." [We are having a serious difference of opinion in our house right now about best-case and worst-case. I may discuss this later at more length--or not.]

Here is the big one:
"The top one is, in general, the failure to have a financial plan," he says. "That includes a tax plan, an income plan and an investment plan. I left out an estate plan because you don't need an estate plan to retire. But I'm not saying you shouldn't have one."

"Other tax regrets:
• Premature IRA withdrawals. [I had to do this once.]
• Botched Roth roll-out strategy. [Could have been me, but I have a plan now.]
• Not getting out of Dodge." [One of the points of contention in our household just now.]

Several other client quotes from another FA (more details in the article):
"1. I didn't save enough for retirement, and I spent more than I should have in my peak years." [Guilty.]
"2. I leveraged myself too much during my peak earnings year." [Before them, yes.]
"3. I retired too early." [Depends on how you look at it. Is 67 too early? It may be for me. Stay tuned.]
"4. Why did I take that money out of my IRA or 401(k)?"
"5. I thought Social Security was supposed to provide for me." [I just hope that my estimates, including the 25% haircut in 2030 or so, are reasonably accurate. My estimate of 2% COLA is already too high--the Feds are using 1.5% this year. They must be ignoring health care.]
"6. I was a picture of health in my middle age." [The possibility of an early death does not frighten me--how will I know, after all?--but disability does.]Maybe this should be cross-posted in Young Dreamers?

The most important lesson is: Plan, and start early. This includes self-education.

This dawned on me late, but not too late. I have been fortunate to have got a great job for my last one that has saved our family from some very hard times. We are not on high ground, but we have a good chance to avoid drowning if we can agree on a tighter budget.

 

[Amethyst]

There have been innumerable threads on "where" and "whether" to move after retirement. Although the article makes it seem like a no-brainer, it's a very complicated decision, where one size fits only one retiree.

After you have put down firm roots in a location - even a high-cost location - the cost of pulling up the roots and putting down new ones can be high, and you may well encounter unexpected costs in the new "Dodge" of your choice. Those could be monetary costs, or the costs of living a less attractive lifestyle than you're used to, or (if your data and/or luck are really faulty) both.

We have been diligently pursuing this calculus for several years and are still on the fence.

Amethyst



"Not getting out of Dodge. Not moving to a new city or state as a tax-reduction strategy. "You have to consider state taxes, local taxes, property taxes and even federal taxes," Lang says. "Clients say, 'I paid way too much in taxes on all these different levels.' A move to a tax-friendly jurisdiction for retirees would have been better."