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Ready to Retire

Richard Quinn  |  Mar 28, 2022

IF THERE WAS ANYONE who should have been emotionally unprepared to retire, it was me. In the years immediately before, I was at the top of my career. I’d been promoted to vice president. I had virtual total control over my job. I was recognized by nearly every employee because of my extensive employee benefits communications and the fact that I’d negotiated benefits for decades. I was among the few who routinely met with the company’s chairman.

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My Time to Claim

Howard Rohleder  |  Mar 14, 2022

I’VE FINALLY DECIDED when to claim my Social Security benefit. Along the way, I realized that calculating the ideal start date is easy—provided you can predict your retirement income needs (doable), your investment returns (hard), the inflation rate (hard), your future tax rate (hard), your date of death (hard) and what Congress will do in the future (impossible).
This particular financial journey began when I was preparing a recent blog post on the knotty issue of when to file.

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Tough on Quitters

Mike Zaccardi  |  Mar 14, 2022

JUST HOW ROUGH HAS 2022 been for retirees? Vanguard Target Retirement Income Fund (symbol: VTINX) is down nearly 6% so far this year. Barring a strong comeback, this could be among the lousiest years for this conservatively positioned mutual fund since its October 2003 inception.
The pandemic led to a rash of retirements. Soaring stock prices, booming real estate values and flexible work arrangements helped change the employment landscape. Many Americans finally called it quits in recent months.

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Drawdown Drawbacks

Richard Connor  |  Mar 8, 2022

LOTS OF RESEARCH has been done on the best way to generate retirement income. It’s one of the most popular topics on HumbleDollar. I think this popularity is driven by two things: its obvious importance—and the fact that there’s no one right answer.
By contrast, figuring out how much we need to save for retirement is relatively easy. It isn’t hard to pick a future retirement date, or at least a range of years during which we’ll likely retire,

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What, Me Worry?

Richard Quinn  |  Mar 5, 2022

I’M IN THE HABIT of checking my investments every day. Since I consolidated them into one Fidelity Investments’ account, it’s easy to see the impact of market movements on everything I own. I don’t depend on my investments for income, but it still shakes me up when I see big drops, especially several days in a row.

If market gyrations affect me, what must they do to retirees who depend heavily on their investments for income?

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Fearing Fear Itself

Richard Quinn  |  Feb 26, 2022

SEEING YOUR IRA or 401(k) decline precipitously is bad enough. Locking in those losses is far worse. The good news: I’ve perused various Facebook retirement groups since the Russian invasion of Ukraine and have seen few signs of panic.

For instance, here’s some good advice from a prudent retiree: “Stay the course, but in the future make sure you have enough in a cash reserve for at least one year of planned withdrawals or RMDs,” meaning those pesky required minimum distributions that must be taken each year by those of us age 72 and older.

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After You Leave

Richard Quinn  |  Feb 20, 2022

VIEW ANY NUMBER of YouTube videos on retirement planning, and you’ll find advice on how much you need to save each month, how to invest, how much to accumulate and how to generate retirement income. The same is true for the experts who write blogs.
All this information relates to the retiree. Rarely—actually never—have I seen a discussion about survivor benefits. Even the 4% rule uses an assumed 30-year retirement period, apparently ignoring the possibility that retirement income needs to last over two lifetimes that may extend beyond 30 years,

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Building a Bridge

Richard Connor  |  Feb 19, 2022

WHAT IF WE MADE IT easier to delay Social Security, so more retirees ended up with a larger monthly check?
Last year, I wrote about a study from Boston College’s Center for Retirement Research (CRR) that detailed the value in claiming Social Security later. A new CRR paper examines the topic further.
The paper describes a survey of those nearing retirement. The goal: to gauge interest in using a 401(k) “bridge” to generate income while folks delayed claiming Social Security.

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Making Your Claim

Richard Connor  |  Feb 16, 2022

THE SOCIAL SECURITY claiming decision is one of the most complex—and contentious—choices that retirees have to make.
I was reminded of that in December, while at a Christmas party. Two former colleagues were discussing their Social Security decision. Both are male, single, childless, retired engineers. Each has a traditional pension, a paid-off home and significant retirement savings. Ted is age 77. Fred is 66.
Ted took his Social Security at 62. His reason was longevity or,

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Retire Those Fears

Meir Statman  |  Feb 9, 2022

THE DRUMBEAT OF “retirement crisis” is much too loud. While 54% of retirees believe there’s a national retirement crisis, just 4% describe their own retirement situation as a crisis. And whereas 90% of recent retirees are able to spend freely, within reason, or can cover their needs and also engage in some discretionary spending, only 10% say that they’re on a strict budget.
Concern about running out of money is regularly exaggerated by inflated estimates of life expectancy.

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Valuing My Income

Howard Rohleder  |  Feb 8, 2022

READER COMMENTS on one of my blog posts prompted me to dig deeper into my thinking about asset allocation. A trip to the HumbleDollar archive led me to a Charley Ellis article where he emphasized that readers should incorporate Social Security, pensions and annuity payments into any analysis of their asset allocation and portfolio risk.
A guaranteed stream of income is clearly valuable. I knew this, but I had missed the obvious conclusion—that the net present value (NPV) of these income streams should be considered part of a portfolio.

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Use It or Lose It

Mike Drak  |  Jan 28, 2022

THERE’S AN EXPERIENCE I keep thinking about. I was visiting Italy pre-pandemic, enjoying a great dinner with a lovely family. I was introduced to two nonnas—grandmothers in Italian—who were in their 80s. Although fine physically, they were both suffering from dementia.
That got me thinking about how that could have happened. I’ve read plenty of research on how retiring to a simple lifestyle, and not being challenged mentally, accelerates cognitive decline. I wondered whether that’s what happened to the two nonnas.

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Fire the 4% Rule

Greg Spears  |  Jan 25, 2022

I DID ACHIEVE financial independence and retire early—if you count age 64 as early. My friend Jose, a true believer in FIRE, or financial independence-retire early, celebrated his retirement at 44. That took a steely nerve that I lacked, plus I had big college bills to pay before retiring.
One big challenge of FIRE, of course, is that your savings might need to last 40 or even 50 years. Vanguard Group recently published a research paper to help FIRE followers go the distance.

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Life’s Not a Beach

Mike Drak  |  Jan 21, 2022

WE’VE BEEN BRAINWASHED by advertisers and financial firms into believing that retirees are a homogeneous group who all want the same things. They aren’t. Instead, they have differing needs, values and wants, and this divergence is getting greater because of things like increasing longevity, dwindling job security and the elimination of pensions.
Let’s consider the standard bell-shaped distribution curve—and then apply it to people’s retirement behaviors. On the far left and far right of the curve are the outliers,

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Five Money Moves

Dennis Friedman  |  Jan 19, 2022

WHEN FOLKS TALK about their best financial decisions, they’ll often mention the investments they bought. But my list is quite different. Here are the five best money moves I’ve made during my dozen years in retirement:
1. Updating my estate plan. When I was my mother’s primary caregiver, she was the major beneficiary of my estate. If something happened to me, I wanted to make sure she could afford the care she needed.

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