Interesting question – take two

Last post we took a detour to discuss travel. Travel is the most cited ‘want to do’ activity in retirement. This week we’ll really spend time on the interesting question.

The interesting question

I was reading a practicing financial advisor’s article in a financial planning magazine and ran across an interesting question; “Is your goal to be the richest person in the graveyard?”

If you’re like me, the first place you went with the question was money, particularly a legacy to heirs of money. Your legacy is important and financial planning around a monetary legacy is critical if it might be large. However, let me suggest that while money is a consideration, perhaps money should be the lesser part of your legacy. You have already built a part of your legacy, cash and non-monetary, over the course of your life. You now have the chance to add to your legacy in your pre-retirement and retirement years. Let’s consider legacies.

What’s in your legacy?

In my case, my family members left me the values of honesty, hard work, perseverance, adaptability, and continuous learning. I hope and believe that we passed these on to our children and that they will pass them on to the grandchildren. I have some friends that are retired teachers. They are childless, but I hear stories of how even today former students will stop them in stores and remind them of the values and lessons they learned in their classes. The legacies of some of my coworkers (many still living) to me included exemplary work ethics, technical excellence, generosity, sharing, caring about, and humor.

Values

You have already left a value legacy. You can build on it by making it explicit; consider writing an autobiography and pointing out the values you were trying to pass on. One of my most treasured possessions is a copy of a typed transcription of my great-great-grandfather’s diary from several months in the 1860’s. Your autobiography could connect multiple generations with your values legacy. Don’t worry about the grammar and spelling, they will treasure your history and memories.

Actions

A number of our friends continue to create their legacy in pre-retirement and retirement by contributing to the community. Some are committed to environmental causes; one keeps an entire mile of street free of litter as part of an adopt-a-highway program. Another group helps with youth development by volunteering for Scouting. Some friends do genealogy to document their family lineage. Still another set helps with anti-poverty and disaster relief through religious institutions and non-profits. Others help maintain our democracy by volunteering with their political parties.

I have attended a number of funerals where “the dash” was read. Think about your ‘dash’ and consider how you might engage in the community. Here’s a link to Volunteer Match which can help you find opportunities to meet your interest and abilities.

Back to the money

“Is your goal to be the richest person in the graveyard?” The financial advisor indicated that he strongly encourages clients to definitely not be the richest person in the graveyard. A different way of saying this is, ‘die broke’.

Why not be the richest person in the graveyard? A few reasons come to mind:

-quality of life

-estate tax

-smaller gifts instead of a large inheritance.

Hopefully your RIP is set up to provide you with a lifetime retirement income, regardless of how long you live. If you spend too frugally, you could end up with a lower quality of life than you could afford, leaving a larger estate that was necessary. Consider the balance in your retirement spending between quality of life and monetary legacy.

Even though the Federal estate tax limit has been raised, that does not mean your state’s estate tax has followed. Dying with a large estate and no estate tax plan can cost a literal fortune. I know of one middle-class family that wrote a $40,000 estate tax check because of poor planning. With minor planning and gifting they would have had no estate tax due – ouch. Charitable donations and gifting are a couple of techniques for avoiding any estate taxes. If you will have retirement income outside of Social Security and/or a defined benefit pension, a checkup with an attorney specializing in estate planning will likely be well worth your time.

If you are fortunate enough to have some financial assets that you think might pass on to your heirs, consider multiple smaller gifts while you are living. One advantage here is that you will get to see the next generation enjoying the gift, which may have been used for a home, car, or vacation. One key rationale for smaller gifts is that they are less likely than a large inheritance to enable sloth or other moral hazards of wealth without work.

Consider what legacy strategies fit best for you, including dying broke.

Actions you can take include:

-Consider how you might answer the question, “Is your goal to be the richest person in the graveyard?”

-Consult an estate planning attorney to see what, if any, estate plan you might need.

And if you have not seen the “Why you should read this blog…WIIFY” post, it’s here.

Questions, comments, or suggestions for retirement surprise areas you want to know more about?
-Leave a comment
-Use ‘Contact’, above, to send an email.

Interesting question.

The question will come a little further down, let’s think about Memorial Day first.

Memorial Day

It’s Memorial Day weekend in the US, commencing with Civil War remembrances of those who served and died for our country. Many have served and died for our freedom and values since. Take a moment and reflect and respect their sacrifice. Many died in combat, many others as a result of combat; wounds visible and invisible.

We ask much of our defenders and they deliver. We should first demand that our leadership use force only as a last resort, as the human cost is incalculable.

Off-season travel

Last month we were able to take an off-season trip to the Netherlands (note the link is an official Netherlands site in English; how polite and kind), Belgium, and France. We were a little later this year than usual, early to mid-April, so the weather was warmer and there were more people. I said more people but we did not really see crowds, except for the amazingly long line (1km?) to a ‘Fallout Boy’ concert at the Amsterdam ArenA on the way to our hotel.

Since we were a little more towards Spring than Winter, the hotel prices were a somewhat higher, but still within our retirement travel budget. Restaurants were open and uncrowded. The best part was that most of the museums and parks were like having private viewings.

We have been fortunate to travel to Europe a few times and have already seen the more popular tourist spots. The ‘few times’ comes from a discussion we had some years back on how peoples’ motivation and ability to travel declines over time. We made a conscious decision to make the most of our ‘now’ and attenuate our spending in other areas in favor of travel. We try to mitigate the cost of travel by going off-season, shopping for the best air travel price, and using public transportation. Typically, we’ll have breakfast in the hotel room, have a nice lunch at a restaurant, and sandwiches and desserts from a local supermarket in the room for dinner (usually an Albert Hein in NL and BE, Carrefour and Marks & Spencer in FR, Waitrose, Pret a Manger, and Marks & Spencer in GB). Bob and Sarah from the Success story! post gave us that tasty and money saving hint.

Many museums and attractions are free or can be discounted with city cards (Paris Pass, London Pass, Antwerp City Card).

The smaller museums we enjoyed this time included:
-Museum Our Lord in the Attic – Amsterdam
-Jewish Historical Museum – Amsterdam
-Rembrandt House – Amsterdam
-Maidens House Museum – Antwerp
-Museum de Reede – Antwerp
-Museum Eugeen Van Mieghem – Antwerp
-Ruebens House – Antwerp
-Cognacq-Jay Museum of 18th Century Art – Paris
-Zadkine Museum – Paris
-Andre Jacquemart – Paris

Every museum was uncrowded and in some we had the exhibits completely to ourselves. My personal favorite this time was the Zadkine. I had never heard of Ossip Zadkine before, but in my opinion he was an amazing and gifted sculptor. I definitely recommend the Zadkine a part of any visit you make to Paris. The museum is run by the City of Paris and entry is free. The Zadkine is also very time friendly as it is compact – 45 minutes would be a very long visit.

Here are a couple of my Zadkine favorites. First, one I don’t have the title for:

zadkine lyre

La Foret Humaine (1957-58):

la foret

We also got lucky and were able to get an Antwerp harbor tour. They opened a week early because of the excellent weather and we just made the 2:00 boat. Great harbor tour.

We navigated a construction zone to get there:

on the way to the boat

The tour was great – plenty of giant industrial stuff:

on the boat

And the way back had its challenges:

finding our way back

The interesting question

I was reading a practicing financial advisor’s article in a financial planning magazine and ran across an interesting question; “Is your goal to be the richest person in the graveyard?”

Minor surprise here – I ran out of space, so we will (re)visit the interesting question in the next post. In the meantime, see the actions you can take, below.

Actions you can take include:

-Consider how you might answer the question, “Is your goal to be the richest person in the graveyard?”

And if you have not seen the “Why you should read this blog…WIIFY” post, it’s here

Questions, comments, or suggestions for retirement surprise areas you want to know more about?
-Leave a comment
-Use ‘Contact’, above, to send an email.

What will you do?

Apologies

First – apologies for the lack of updates the past couple of Fridays. I was on a retirement test (vacation) and did not complete the weekly updates.

Activities

Ahhh, the dream of leaving the workforce. No more mandated schedule and your time will be your own! Does that leave you exhilarated, scared, excited, or confused, or even all of the above? I am personally in the all of the above category.

In my current state of still working full time, I go to work five days a week where I get:
-playgroup (meetings!)
-snack (breakfast and lunch)
-assemblies (all company meetings)
-individual work time.
I actually get paid to go and have organized activities, although not necessarily of my choosing. Once you are retired, the organization of your day and activities is up to you, and if you do not plan, it may be day after day of daytime TV.

Avoid the void

And there’s the retirement surprise we want to avoid – the retirement activity and social void. You and I need plans for what we want to do and, in some cases, we’ll switch from being paid for your days to paying for our days. As an example, if we want to go to an assembly (perhaps a movie in a theatre) after retirement, we could end up paying for a ticket. An article on CNN Money cited research that noted, “… a 2013 paper by researchers at the University of Exeter Medical School that reviewed numerous studies on the relationship between volunteering and health concluded that volunteers had a lower risk of mortality than non-volunteers, were less likely to feel depressed and had an increased sense of well-being.” Having a plan means you’ll be doing things and doing things will make for a happier, and likely longer, life. You might drink Coke, because ‘things’ go better with Coke… (perhaps I’ll take up stand-up comedy in retirement!)

Realism

One company I worked for had a policy of ‘realistic previews’ for people entering certain job categories. They had the job candidates complete tasks that were both challenging and related to the work they hoped to be doing. Candidates quickly found that they were suited for the job or that this was not for them. Consider trying the same for retirement. Perhaps you have always planned to make furniture when you retired. If you’ve never made furniture before, perhaps consider some ‘realistic preview’ way of finding out that it is or is not a viable alternative prior to getting a bad retirement surprise.

Maybe you dream of sleeping in until 10:00 AM daily. Not a problem if that’s your dream, but consider trying it next vacation to see if you can sleep that long and to determine how the rest of your schedule might fit with your late sleeping.

What is important to you? Travel, volunteering, kids, grandkids? Put those in the plan. Also, don’t forget to check out the senior discounts for assemblies!

Actions you can take

Actions you can take include:
-Put together a general retirement activity plan that might cover the routine activities for every month. It might include volunteering, grandchild care, movies, lunches with fellow retirees (they don’t happen if someone does not plan them!). What does a ‘normal’ retirement month look like for you?
-Look at the activities of your retired friends – which ones would you like to use as positive role models and which ones are models for what you don’t want.
-Remember you need your health – do you need to be exercising more and eating less? Should you be more blood pressure medication compliant?
Look for the next update on Friday, September 1 at 12:30 PM.

Questions, comments, or suggestions for retirement surprise areas you want to know more about?

-Leave a comment
-Use ‘Contact’, above, to send an email.