What if the market tanks right before I retire?
Is this the greatest fear of pre-retirees? Maybe. But what are some of the competing fears for those about to leave the full-time workforce and enter the next life phase?
- What will I do with my time?
- Can I afford all the travel I want?
- Will my body hold up so I can enjoy retirement?
- Will my expenses actually go up or down?
- Will my kids continue to need financial support?
- Do I need to downsize to save money?
- How do I get rid of all the stuff that I don’t need anymore?
- Will medical expenses bankrupt me?
A market downturn, crash, pull back … whatever you want to call it, is paramount in the fears of many pre-retirees. It gets a lot of publicity in the media. That’s how they sell ads. As a financial planner, we do our best to educate and direct our clients towards a strategy that allows them to sleep at night and not have to worry about the stock and bond markets.
How about all those other fears we just listed? That takes a little more introspection and study on behalf of our clients and others whom we interact with as they seek the most reliable path(s) to travel during a period we like to call financial independence.
There are many good books we recommend to inform and energize our clients with additional insight and views on becoming a successful retiree, however, they want to define it.
The New Retirementality by Mitch Anthony
The 5 Years Before You Retire by Emily Guy Birken
The Bogleheads Guide to Retirement Planning by Larimore & Lindauer
How to Make Your Money Last by Jane Bryant Quinn
There are a lot more books and articles that your friends and peers might recommend to you.
So how can you prepare for retirement or financial independence and blast away those fears?
• Develop a vision of your perfect retirement
• Discuss your dreams with your spouse or significant others
• Get some professional advice (conflict of interest notice!)
• Prepare a budget and outline a plan
• Have coffee with those just ahead of you in life. See what they have to say about your plan. What have you left out?
Don’t worry about the markets, they will take care of themselves. Start your homework now and don’t wait too long. If you want a three-year outline for actions to take just before retirement, just email me for a copy of our latest tool.