When Can I Retire? StreetSmarts with Howe & Rusling

Dylan Potter, CFP®, Vice President, Portfolio Manager goes beyond the bell to tackle a question on so many people’s minds: When can I retire?

Hi i’m dylan potter vice president portfolio manager here at hound wrestling on today’s episode of street smarts we’re going to tackle the question of when can i retire first this is an intensely personal question every person’s retirement outlook is different the bottom line is that you’ll be able to retire when the income streams you create whether it be

Social security your savings investments and any other sources you might have are enough to support your desired standard of living after you leave your job most financial planning doctrine says this usually equates to about 80 percent of your working lifestyle annual expenses of course there’s no one-size-fits-all answer here many retirees plan to travel the

World after they retire while others are perfectly content with living a simple or inexpensive life what we do know is that we should expect to live a long time in 1930 five years before social security legislation was passed the average life expectancy of u.s citizens was about 59.7 years old thus the math worked out somewhat favorably for a program designed

To pay workers a continuing income after retirement at age 65. the number of people who could statistically expect to live long enough to collect was relatively limited and the percentage of people older than 65 was less than 6 percent of the population today the average life expectancy in the u.s has gone up to almost 80 years old in fact if we dig into the

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Numbers a little bit if an american female lives to age 65 she has a 75 chance of living at age 78 a 50 chance of living to age 85 and a 25 chance of living at age 91. these numbers increase more when we look at the odds of at least one spouse in a married relationship so is it a million dollars or two million dollars that i need in retirement well let’s do

Some time value of money math to illustrate two different individuals age 65 and ready to retire individual a has a more expensive lifestyle he envisions spending about seven thousand dollars a month above and beyond what he’s receiving in social security this equates to about eighty four thousand dollars a year above and beyond social security if we assume

An annual rate of return of about five percent and a lifespan of 30 years to age 95 that individual theoretically needs a portfolio of about 1.3 million to stretch over those 30 years of distributions this portfolio would need to be even larger if we assumed that that individual wanted to leave a financial legacy to his beneficiaries conversely individual b

Only plans on spending about two thousand dollars per month beyond social security or twenty four thousand dollars annually again if we assume a thirty year life span and an annual rate or return of about five percent the starting value of that portfolio on the eve of retirement would need to be only about 373 thousand while these are merely examples they aim

To illustrate that small changes to inputs can drastically affect what is theoretically needed in retirement perhaps a more appropriate initial question is how do i envision my life in retirement well the usual narrative tends to be golf grandkids and travel we all know that life in retirement is perhaps a bit more complicated than that as we all live longer

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Lives there’s an awful lot to consider about your retirement years from choosing the right medicare plan to the possibility of upsizing downsizing or moving it also means having a plan to generate income in your portfolio while also understanding your sustainable drawdown rate ultimately retirees want to be able to live their desired lifestyle when they are

No longer actively employed they want to be able to solve the problems that come with longevity and those problems more and more go beyond simply funding your retirement accounts with stocks and bonds control what you can control and make the most of those things that you can control but lean on your team to evaluate the factors that are somewhat or completely

Out of your control within your comprehensive retirement plan if you aren’t sure if you’re on track for the retirement you want it’s a smart idea to consult hound wrestling financial planners who can assess where you stand now and suggest a savings and investment plan to get you to where you want to be thanks for tuning in to this episode of street smarts where

We discussed your road to retirement and remember a team of competent individuals is a force multiplier

Transcribed from video
When Can I Retire? StreetSmarts with Howe & Rusling By Howe \u0026 Rusling