On the Money: Questions to Answer Before Retirement

(0:01) Rising Illinois Taxes

(12:11) Optimism vs. Pessimism and Financial Health

“After controlling for wealth, income, skills and other demographic info, researchers found optimists were more significantly likely to experience better financial health than pessimists. Optimists were more likely to seek and follow advice from someone they trust. Optimists reported stressing 145 fewer days each year compared to the pessimists.”

Paul A. Ruedi

(17:44) Do You Have Your Retirement MBA?

“The three things that seem to be consistently correlated with having a happier life: first - it’s a sense of mastery – making progress towards something you are working on. Probably the biggest one is a sense of belonging – having good relationships in your life. And then the third is autonomy – feeling like you have control over your own life instead of feeling like you are doing things because you have to do them.

If you look at retirement you have a huge uptick in autonomy, but at the same time you end up losing a sense of mastering and belonging that you get from your career.”

David Ruedi, CFP®, RICP®

Read David’s blog: Do You Have Your Retirement MBA?

“The perfect retirement is one where you have enough money to sleep at night and enough purpose to wake up.”

Paul A. Ruedi

“As you retire you have to retire to something else – so you fill that void of mastery or belonging that you had in your workdays with something else. It could be volunteer work, it could be doing something as a part time job, being part of groups or getting involved with some part of the community that you weren’t involved with before.”

Ryan Repko, CFP®

“Money will help you fund a purpose, but it won’t help you find it.”

Paul A. Ruedi

(27:10) Questions to Answer Before Retirement

(27:23) How Much Will I Need to Spend During Retirement?

“Most people, if they’re honest, say they don’t really know how much they spend month to month because the money is there, they spend it, and it’s gone. But if you look at how much you spend net of savings and taxes, adding in food expenses, home and bills – that’s really what you need to be able to have a minimum to replace what you are doing now.”

Ryan Repko, CFP®

“You also want to consider how things will change once you retire. Usually discretionary spending on restaurants meals and activities go up. A lot of times car expenses go down because you aren’t commuting.”

David Ruedi, CFP®, RICP®

(29:55) What Would my Ideal Retirement Look Like?

(31:21) Are there any Financial Boulders Putting my Retirement at Risk?

(33:20) What Does Not Working Mean to Me?

“One of our new clients is going to be working part time for a while just because he wants to. He’s going to be doing something different than he did before and it is something he enjoys more than his old job. It gives him a little spending money. It’s a triple benefit – and I think that’s particularly compelling for people retiring at a young age”

David Ruedi, CFP®, RICP®

(35:55) What Financial Tradeoffs Do I Need To Consider Before Retiring?

“By far the biggest consideration is when you retire. The earlier you retire, the less you can spend, the later you retire, the more you can spend. We know that, so you just have to decide is it worth it to me to work another ____ years to have this extra income, and that answer is going to be different for everyone.”

David Ruedi, CFP®, RICP®

(38:11) How Will I Invest During Retirement?