Retirement Wellness and Financial Planning: Nurturing Wholeness in Life's New Phase

Episode Transcript
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(00:00):
Aloha

(00:51):
Inspired Money maker. Welcome. And if this is your first time
tuning in, welcome, welcome. You here. And if
you're returning, welcome back. When you hear the word
retirement, what comes to mind? For some,
it's exciting dreams of travel, more time with family,
or finally starting that passion project. But for others,

(01:14):
it can be terrifying. No more steady paycheck. A
lifetime of savings suddenly has to carry the weight of your daily
expenses, all your needs, wants and wishes.
But what if retirement isn't about stopping? What
if it's about starting? Starting to live your life on your terms.
I know people who have traded in their 9 to 5 for freedom,

(01:37):
but they didn't stop working. They redefined what work
meant. They started businesses, mentored others, volunteered,
even went back to school. Not because they had to, but
because they wanted to. That's their retirement:
purpose-driven, financially sound, and deeply
fulfilling. Whether your goal is traditional

(01:58):
retirement at age 65, retiring at
35, or forging your own path, in this
episode we're talking about how to design a successful
retirement. We're going to explore things like
how to take a holistic approach to retirement wellness that
includes your mind, body and money. Plans

(02:19):
for rising health care costs without
breaking the bank, how to build a sustainable income that
adapts to life's changes and staying emotionally
and mentally resilient through the transition.
Let's ensure that retirement is more inclusive and
accessible for everyone. I know that retirement isn't

(02:41):
one-size-fits-all in the old rule book. I think it is
being rewritten. So stick around. You're about to meet four
incredible guests who are going to guide us through the retirement

from every angle (02:53):
financial, emotional, personal
and societal. Before we dive in, I want to thank today's
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future results. The subscription auto renews at the then
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of companies and it's very helpful. So again the link
is inspiredmoney.fm/alpha. Now

(04:20):
let's meet today's expert panelists.
First, let's welcome Christine Benz. She's the director of
personal finance and retirement planning at Morningstar where she's
helped millions make smarter money decisions. She's also the author

of the book "How to Retire (04:35):
20 lessons for a Happy,
Successful, and Wealthy Retirement." She was also named
one of the most influential women in finance by Barron's.
Christine, so glad that you're here. Andy, it's great to be here.
Thank you so much for having me on. Next up is Pete
Neuwirth, a senior consulting actuary with

(04:57):
over I have 35 years of experience, but I think
he's going to tell us that it is more than that. He
has years of experience guiding Fortune 500 companies on retirement
strategy. He's the author of "What's Your Future Worth?:
Using Present Value to Make Better Decisions" and "Money Mountaineering:
Using the Principles of Holistic Financial Wellness to Thrive

(05:19):
in the Complex World of Money Mountaineering." Oh,
I think I totally said that all wrong.
You got it pretty much right. Yeah, it's a little bit, I do have a
little bit more than 35 years, but people have told me that that
makes me sound old. So anyway, thank you so much for having me,
Andy, and I'm really looking forward to this. We're excited to have you because

(05:43):
not only are you an actuary, but you're a leading voice in
holistic financial wellness. Well,
maybe. I don't know. I was
onto it pretty early about 10 years ago
when I wrote my first book, "What's Your
Future Worth?" I was trying to

(06:06):
communicate the actuarial perspective
could be very, very helpful to make better life decisions,
whether it be medical job and so forth. And
but people really didn't want to talk so much about
that, but I did. So I started this
URL
holisticfinancialwellness.org

(06:30):
and I think I still own it. But because people
wanted to talk about money, that's when I wrote Money Mountaineering
to give people, we get world of money. We'll be sure
to talk about money today. We have my friend
Jason Vitug here. He is a best selling author,
wellness advisor and Founder of Phroogal. Through

books like "You Only Live Once (06:52):
The Roadmap to Financial Wellness
and a Purposeful Life." He has another book,

"Happy Money, Happy Life (07:00):
A Multi Dimensional Approach to Wealth."
I'm messing up the book titles today. "A Multi-Dimensional
Approach to Health, Wealth and Financial Freedom." He blends personal
finance, mindfulness and purpose to inspire meaningful
living. Jason, you're just returning I
think today maybe from a social media sabbatical where

(07:22):
I'm assuming you refresh your mind, body and
spirit. Yeah, I am. So I'm
back on social media and this is a great way to
to kickstart the engagement back on socials. So
it's been, I know six to eight months and

(07:42):
it's been a great six, eight months because I've been able to mentally and emotionally
recharge and focus on projects I've kind of pushed to the side
and now I am ready, I'm stronger and
I've taken care of my mind, body and spirit and so now
I can continue the work. Well, all right, we welcome
you and your long locks.

(08:05):
Now, I don't know if Jordan Doc G.
Grumet will be coming in. Hopefully he'll be coming in shortly.
Jordan is a regular guest on Inspired Money. I have not
heard from him. No word on him not being able to make it. So I'm
assuming that he'll be in. Jordan is a hospice physician
turned personal finance educator. He hosts the

(08:26):
popular Earn and Invest podcast and brings deep
insight into the emotional side of money. He's the author of "Taking Stock
A Hospice Doctor's Advice on Financial Independence, Building
Wealth and Living a Regret Free Life." His

most recent book is "The Purpose Code (08:41):
How to Unlock Meaning, Maximize
Happiness and Leave a Lasting Legacy." We've
just got a tremendous team of experts today. We're in
for in informative, inspiring conversation. Let's
get into it with segment one. Retirement is a
transition from a structured work identity to a purpose driven

(09:04):
lifestyle. Maintaining a sense of meaning involves pursuing
hobbies, lifelong learning or volunteer work.
Engaging in social activities and using technology to stay connected
helps prevent isolation. Intergenerational relationships
offer mutual benefits, fostering a sense of contribution and
engagement. Financial stability plays a key role in

(09:25):
overall wellness. Unmanaged financial stress can impact
both physical and mental health. A structured retirement
routine that includes financial planning, exercise and
mindfulness practices supports long term well being.
Activities such as group fitness, meditation and financial check
ins contribute to balance. A retirement wellness roadmap

(09:47):
should incorporate personal values, social engagement, physical
health, mental well being and financial planning. By taking
a proactive approach Retirees can create a lifestyle that
promotes fulfillment, stability and overall wellness
in this new phase of life.

(10:09):
Christine, based on the lessons in your book "How to Retire,"
what's the single most overlooked component of a holistic retirement
routine? Mind, body or money? Well, I
would say probably mind and I would connect that
to connections to other human beings because
I do think that relationships, connections,

(10:31):
social connections are a very underrated
component of life satisfaction,
life happiness. A lot of research has been dedicated
to determining what leads to happy and successful lives and
much of it points to the value of human connections. So
certainly keeping your mind engaged by staying

(10:54):
engaged with other human beings is mission critical
as we think about aging.
Pete, your "Money Mountaineering" model talks about peaks and valleys.
How can that framework guide someone combining fitness
planning and financial peace? Well,
you know, to me again, I'm more

(11:17):
about the money, the money and the risk. But
in that spent, you really need to be holistic in thinking about
all aspects of your financial world, including
those things that could jump up and bite you. So
for me, I think it's very important to really
scan the entire horizon of your financial

(11:40):
future, financial life and identify those areas
that are, you know, make you feel uncomfortable, make you feel
afraid, make you feel, you know, maybe overconfident
and really build in the entire picture.
Jason, you talk about intentional living,

(12:00):
like what has your experience been like?
Well, I love what Pete said, that he's all about the money because I
am the guy who's all about the wellness. I just happen to talk about the
money part of it. And so for me,
I learned about 10 years ago as well
about these multi-dimensional approach to life,

(12:22):
that we're not just one dimension, we are eight
dimensions. So that's mental, emotional, physical, social, occupational,
environmental and financial well being. And these
dimensions are interconnected, overlapping. When one dimension is suffering,
it has a ripple effect on other dimensions. And so
I thought that just improving my finances was

(12:44):
going to improve my mental health, my physical health, and that certainly can have
an impact. But if I don't intentionally focus
on improving my mental well being, whether it's
learning something new, whether it's de stressing or things
like that, or even regulating my emotions for
emotional well being, that will then have an impact on my finances.

(13:06):
And so for me, intention, it really is about
understanding that you are multidimensional and
that we shouldn't focus solely on one aspect because
if we, if, if we let go of one
area or focus too much on one dimension, that has that,
that negative ripple effect as well on the others when we neglect them.

(13:29):
So it sounds like if you have different legs of the stool,
if one's missing, you fall over. Yeah, exactly
it. So, Christine, if the mind
is the most frequently overlooked,
how do we systematically approach a
financial plan so that it's more than just the money?

(13:52):
Well, I think it starts well before your anticipated
retirement date. And so I do think the
concept of retirement is this hard stop is
antiquated and it ought to go by the wayside. I've come
to believe that a kind of a glide path into retirement is
a much better model for all of us. So I

(14:13):
urge people, if they're kind of moving into their middle age,
maybe at age 50 or thereabouts, to really take
stock of what aspects of your work you enjoy,
what aspects you don't enjoy, and try to pull forward the
things that you enjoy. And maybe you do that kind of in stealth mode where
you're not telling your employer, or maybe you're

(14:35):
actively engaging with your employer about what your preferences are
in terms of the complexion of the work you do, because it turns out that
work, whether paid work or some other activity
that brings us purpose and identity and structure
that's really good for us throughout our lives
and we don't want to entirely leave it behind. So I

(14:58):
would urge people to reimagine retirement as kind
of a glide path where you're shedding activities that you're
not enjoying as much. And if you're someone who has neglected
your physical self in the years leading up to middle age
or older ages, it's time to really engage
on improving your health. If you've neglected your relationships,

(15:21):
really be intentional about figuring out how you'll put yourself in
contact with other human beings on an ongoing basis. Don't
wait until retirement to make these fixes.
You should address them well before.
I was just going to say I think Christine is absolutely right

(15:42):
on that notion of looking, starting to
think about retirement well before retirement. And that glide
path is a very powerful concept. And it also
dovetails with something that we find in the
retirement income strategy analysis, that one of
the most important assets that a retiree has is

(16:04):
the present value of their future earnings as a part
time for part time work. So
finding something that you love, that you can actually make a little bit
of money with after your retirement is a very powerful
supplement to a retirement income strategy. One
thing I would interject, Andy, is that when we look at the data on

(16:27):
who is working longer, it's actually the
wealthier segments of our population. And so the people
who are needing to work the least are able to work the most.
So that's just kind of something to keep in mind that people oftentimes have
this intention to continue working, but maybe they have a job
that's physically demanding or they have health issues or their spouse

(16:51):
has health issues. There are things that knock people out of the workforce
course earlier than they might wish. So that's just kind of a
caution when I hear from people where they say, well, okay, my plan is to
work until I'm 75 or something. Great aspiration, if you like
that work. But it's not necessarily a plan. So just kind
of a caution that people shouldn't lean too much on

(17:13):
working income to make a save if their retirement
assets aren't looking like they will be sufficient. Wise
words and a reminder that not all jobs
are created equally in terms of how long you can work in that
job. Jason, has your,

(17:33):
like, definition of retirement?
Has that changed over time? And do you see many people
changing how they define retirement today? Yeah,
so I quote, unquote, retired early, and not because I
had millions of dollars in the bank, but I just realized I needed to

(17:54):
rewire. So we're having these conversations about that glide path. I think
that's a really awesome concept and the concept of rewiring our brain
and not to retire from life and from
living. And so, yes, the evolution and my understanding of what
retirement is, because it's drilled down, you
know, since. Since I can remember that, oh, yeah, we retire at the age

(18:16):
of 70. So we work all these years. We try. Try
is a key word to save for retirement. And if we have to work, we
just gotta, you know, just. Just get up and keep working
if we need to pay our bills. And I realized that that is not
the path and there are different ways for us to go about it. And
for me, I've traveled all across the country and, you know, Andy, I have done

(18:39):
road trips, 37 events in 30 days, all across
big cities, small towns, and have these wonderful conversations with people
with all walks of life. And the vast majority. And to
Christine's point, the vast majority of people that I meet do
not want to retire. What they want to do is actually
leave work that they dislike or hate or just

(19:01):
have to do. But when they think of their, like, elder
years, they actually want to continue doing purposeful work. And if they happen to
be in a career path or in a profession that they absolutely
enjoy and they love, they want to continue doing that. But unfortunately, when there are
medical issues or there's family issues that prevent them from
continuing to work. They're kind of forced to retire.

(19:24):
And now that I'm in Florida, it's really fascinating how many people
who are in their 70s who are retired, who
I continue to have these conversations with that tell me
that they are working not because they need the extra money. They're working
for the social aspect, that they feel isolated
and that's affecting them so they rejoin the workforce.

(19:47):
They certainly are okay with a little bit of extra income coming in, but they're
doing it for the social aspect. Lots to
think about. Let's move on to segment two.
Health care planning is essential for a financially stable retirement
Understanding Medicare coverage options can prevent costly mistakes.
Medicare Part A covers hospital stays while Part B handles

(20:09):
outpatient care. Medicare Advantage and Medigap plans differ
in coverage and out of pocket costs, making plan comparisons
crucial. Delaying enrollment may lead to penalties,
increasing long term expenses. Long term care is another
major consideration. Insurance policies vary and
alternatives like life insurance riders or reverse mortgages may

(20:31):
provide financial flexibility. Evaluating home care
agencies and assisted living options early can help
retirees make informed decisions. Preventative
healthcare reduces medical costs over time. Regular
screenings, vaccinations and telehealth services improve access
to care. Health savings accounts offer tax advantages

(20:52):
and can help cover medical expenses in retirement. Reviewing
Medicare Part D prescription plans and assistance programs annually
ensures access to affordable medications while maintaining financial security.
Pete, long-term care can derail plans how do you

(21:14):
build long term planning into a
retirement model from day one?
I'm sorry, is that you're asking me about that question? Yeah, just
curious what advice you would give to people for designing a healthcare
ready income streaming. Well, that's a great question.
We view health care costs as a

(21:37):
huge and very important component of the expense
side of what you need to prepare
for in retirement. But it's a very gnarly
expense because it can come at any time. It can come in
spikes, it can come at the very end of your life when you're really not
as as well set up. So we

(21:59):
look, we build medical costs into
the kind of generalized cash flow
needs stream which is full of
contingencies. And one of the most important buffers
that we find is home equity.
We talked about the different assets people have in retirement. You

(22:22):
know, there's the 401(k) and there's also again present value of
future earnings or Social Security. But there's also home equity which
many, many, you know, more than half of the people have
tapping into that in a thoughtful and prudent way
through a Reverse Mortgage
HECM, Home Equity Conversion Mortgage Credit

(22:44):
Line, we find is a pretty powerful tool in that, that
regard. And we, we've done some research in that regard.
Christine, I've heard you say that long term care is the elephant
in the room for retirement planning in that
if you don't have a long term care plan, you don't really have a

(23:06):
retirement plan. So what do people need to know? It's a very
tricky question for reasons that Pete outlined. And
the trickiest part of all is that about half of us will have some sort
of a long term care need, about half of us
won't. And so that makes it a tricky
thing to plan for. I think a key step for a

(23:27):
lot of people is to take a step back and think about where you
would fall into one of three categories. So in
one category would be someone who has very little in
investment assets, who is likely to rely on government
provided care should they need it. And so you'd want to
be thoughtful about that, understand what it entails in terms

(23:50):
of the restrictions on the type of care that you can receive.
And then at the other extreme would be the very financially well
person, the type of person who's on Morningstar.com for
example, checking up on his or her portfolio, the person with a
multimillion dollar portfolio. And then in the middle would be
a candidate for some type of

(24:15):
type of insurance care insurance or
a hybrid type product which your intro referenced, which would be a life
insurance policy with a long term care rider.
Or as Pete referenced, in that situation,
the home can be a really nice asset and
can help alleviate some of the concerns that retirees might

(24:38):
have about depleting their investment portfolio
to pay for long term care costs. Well, there's another asset
in your life oftentimes and that's the home equity that you might
have. You just need to understand the repercussions.
You know, if the idea is to sell the home altogether, well, you might
have a well spouse who needs someplace to live. So you just need to

(25:00):
examine the alternatives
or sort of the repercussions if you do have other people who
are relying on you for that housing. Jason, how do
you handle it if you have, you know, you retire early and you have a
longer Runway. Yeah. So part of that is that, you
know, retiring, as I mentioned, I'm about rewiring. So it's not,

(25:23):
I haven't stopped working and I haven't stopped income from flowing into
my life. I've actually allowed income to flow into my life
more easily when I'm not strapped into a 9 to 5 job or work I
have to do in order to pay the bills. But what I wanted to
share was a story that so my mother actually
had to retire early because she was diagnosed with Parkinson's. And so I am

(25:45):
my parents caregiver so I take care of my parents and things like that.
One of the reasons why we relocated to Florida and
I handled pretty much everything for them and they do have
some savings and they do have government benefits and things like that to help them
offset the cost. And so when we talk about long term care planning I tell
my parents and I joke with them all the time. Part of their LTC

(26:07):
was their, their care for me. So I'm
paying it back. And that must might be, you know, being Asian, Hispanic,
Filipino, that, that might be part of the cultural aspect of it
that, that our parents, my parents don't think about long term
care planning and what they might need because
in their mind they're thinking about constantly working and the money's flowing in.

(26:29):
And also there is a little bit of pressure on the kids
to take care of them when they get older. So that, that
is definitely a cultural thing here. But, but
what I've learned and what I talk with others, especially within
my communities and out there on the street
is the idea of the income floor. So the income

(26:52):
floor strategy when it comes to retirement for them to understand what is
the basic essentials, the cost of the
basic essentials today and perhaps in the future in order to
plan for, for, for retirement to ensure that you're saving
and you're investing enough in order to have at least the minimum to cover those
expenses. I think that is kind of one of the things that, that I've

(27:14):
noticed many people are struggling with just to afford
some of the basic necessities. And so when I talk about like when you're thinking
about your retirement planning, consider the, that, that income floor
idea. So this way you start with a baseline and then you work towards
that and then also tapping into, and Pete, Christine mentioned
all these different types of assets, whether it's your home

(27:37):
or things. And it's important for us to consider
those as well as part of it. But what I encourage people
to do is really think of the ROI
of health, right? The return on investment on health that when we're
younger and whatever age we are before we're unable to
work because of a medical condition or a situation, that we

(27:59):
start investing in our mental well being and our physical health.
Because when those things start fraying, when those things starts
impacting US it does have a financial consequence
and that will drain the, the save the retirement
savings, the retirement, and will affect the retirement plan. And
so when people are really adverse on spending money

(28:22):
on a, let's say a yoga subscription,
$100 per month, and they're like, okay, well I'm all about cutting expenses in order
to meet these retirement goals. Well, maybe doing
some yoga classes a couple days a week will help
improve your mind, your emotional well being and also your physical health
that perhaps it will lessen any of the

(28:44):
health issues you might have later on, might not prevent
them, but maybe push them back or lessen them.
Anybody want to add to that? I do. Well, first of all, Jason, I just
want to say bless you for doing the care that you're delivering,
the care that you're delivering to your parents. It's just
a huge benefit to them, I'm sure. And I would also say that

(29:07):
unpaid caregivers are the primary
caregivers of long term care in the US Today.
The issue is that there can be repercussions for
their health, for their ability to earn because they're
often quite occupied taking care of their parents, especially if

(29:29):
dementia is in the mix. So that is something
that people who want to get ahead of this problem need to
be mindful of. Yes, your children may be there to
help you, but there will be implications for their financial
wherewithal, perhaps for their physical and mental health.
So it's, I know, you know, a

(29:51):
great option in many families, but it's not ideal in,
in some situations for the reasons I just mentioned. And, and I do want
to add to that. It, I absolutely agree with you that it, it
is not an ideal. And, and before I used to think
that it's like, why do people push
off the responsibility of taking care of their parents off to strangers or, or these

(30:13):
health facilities and stuff like that. And they think that has a lot to do
with my upbringing. But then eventually I realized that
when you, when your time and your energy
is, is allocated to taking care of a loved one,
it does take a mental and emotional toll. And that mental, emotional
toll because we're seeing, you know, our loved ones

(30:34):
suffering, unable to do the things that they normally have done before in
the past and that mental and emotional toll will affect us
physically. And so there are moments where, yeah, definitely harder for me to get up
out of bed and then that affects my ability
to do the work that actually pays or brings an income.
And so it's not the ideal situation. And in fact, what I've

(30:57):
learned as well, and being in Florida and meeting a lot of
other caregivers who are unpaid, they
tell me that many of their parents as well want to
still feel independent and they don't want to feel a burden to their,
to their kids and that affects the mental and emotional well
being of our parents or those who are retired. So

(31:20):
it is really interesting experience that I've gone through
and has definitely changed the way I looked at things.
Thank you for sharing that. Let's move to segment three.
A well structured retirement budget accounts for essential expenses,
discretionary spending, inflation and potential health care costs.
Tracking spending and using budgeting tools help retirees adjust to

(31:44):
financial changes. Creating a buffer for unexpected
expenses prevents financial strain. Withdrawal
strategies impact long term sustainability. The 4%
rule is a common guideline but market fluctuations require
flexibility. Sequence of returns risk can deplete
savings if withdrawals are too high during downturns.

(32:05):
Adjusting withdrawal rates based on market conditions helps maintain
financial security. Managing debt is essential.
High interest debts should be prioritized and options like downsizing
or debt consolidation can improve cash flow.
Diversified income sources including Social Security,
pensions, annuities and passive income provide stability.

(32:27):
Understanding tax implications and inflation adjustments ensures long
term financial health. Health, strategic planning and informed decision
making support a secure and sustainable retirement.
Pete, you were a junior actuary at Hewitt associates

(32:49):
back in 1981. Give us some context so that we
understand your work. Sure. Well, like
as you say Andy, I was, I was a junior actuary in 1981
and in the fall of that year a senior actuary came
in and gave us all a training session on this brand new
section. Actually it wasn't a brand new section. Section

(33:11):
K of the code section
401 used to be about
Social Security permitted disparity but they rewrote it
and there is this new section K in 401
that this guy said this is going to change your life. It's
going to allow people to defer money
pre tax into this account that's going

(33:35):
to grow tax and it's going to change the way retirement
plans operate and it's going to change your life as a
consultant. And he was absolutely right. And 45 years later
we are now facing a situation that is not bad.
It's a situation where people have big
401(k) balances and many of them also have homes. And,

(33:58):
and as we've said there's all kinds of other assets but
they need to put it all together to form
a retirement income strategy. And that's what
I've been doing for a while now. And the
idea is to look at it as a cash flow
matching problem. And so it's really

(34:22):
all about managing the risks in the decumulation
in the retirement phase, including sequence of returns, but also
longevity, spike expense and other things like
taxes, et cetera. As an actuary, how do
you and your partners at New Earth Associates address
some of those risks, things like longevity and

(34:44):
spike expenses? Well, that's a great question.
And like I said, these risks are for a
long time we were focused on
accumulating wealth and accumulating to the, you know, the number
that you need with, you know, the risk returns,
inflation, all in bound. But after retirement, now you've

(35:06):
got to figure out how long is that, that stream,
that number going to last. So what, are you going to die soon or are
you going to die, you know, you're going to live to 100?
Well, for that, insurance is the answer. You know, life
insurance prevents against premature death, but annuities
prevent against living too long. Now, insurance companies will

(35:29):
charge a little bit more than the true value of that, but
that's what insurance is. It's a premium to mitigate risk.
Jason, what's the most common budgeting blind spot that you see?
You're muted. It really is retirement planning. So this is

(35:50):
a really good topic. So the vast majority of
people are thinking about, okay, yes, I need to invest my 401(k), I
may need to invest in general
investing account just to store some extra additional
cash and things like that. The blind spot is
not planning for the lifestyle they actually want to live

(36:12):
in retirement. And so whether they're retiring at 60 or 70 or
so on, they're not budgeting for wanting to travel a bit more.
They're not budgeting for perhaps living in a different location
where it affords them access to different
activities and things like that. And so that is a really key
differentiator. So now the cost might decrease if they're,

(36:34):
they're leaving a high cost of living area for a
lower cost of living area. But if they're looking at wanting to travel
a bit more and be more active, there are costs associated with that. And so
if they're just planning on saving or
investing enough in order to cover their basic living expenses,
that's important. As I talk about the income floor,

(36:56):
the blind spot is what kind of life do you want to live
and what are the financial resources
there in order to do that? Christine, what are your thoughts?
Andy, I was going to say something super mundane. In the realm of
unanticipated expenses, I actually surveyed our
Morningstar.com retired readers one time about the

(37:18):
biggest line item in their budget that had caught them off guard. It
was dental actually, because many of them were used
to having some kind of coverage through their employers. And of
course our teeth don't get any easier to care for. They get more
expensive as we age. So that was the thing that people mentioned again
and again. But I love the point about people

(37:40):
anticipating lifestyle changes and specifically
they should think about how their spending might change through
the life cycle, so through the retirement life cycle.
So there's a lot of data. Some of the seminal research on this topic came
from my former colleague David Blanchett that looks at how
retirees spend. And what he found is that

(38:03):
on an inflation adjusted basis, retirees
spending does tend to trend down through the life
cycle and then it might flare up later in life because of
uninsured healthcare costs, mainly long term care costs.
But this syncs up with what many of us have experienced with
older adults in our lives. Where the early years of retirement

(38:25):
are the feeling good years, where people have pent up demand
for travel, they have good health, generally speaking,
and maybe they're helping launch adult children in that period
just after retirement, maybe extending for 10 years. Then
the middle years of retirement might still be financially well,
but the retirees might be inclined to, if they travel, they might

(38:47):
travel a little closer to home, might spend time seeing their children
and grandchildren, less of the exotic travel. And of course
this is a huge generalization. There are many 85 year olds who are
still taking exotic trips and more power to them. But when we
examine the data at large, this is the pattern we see. And then later
in life, the spending often trends down even more,

(39:09):
especially if people encounter some health issues. If you're not feeling
good, if you have things going on with your health, well, then you're probably
not traveling, you're probably not dining out as much and all of those
sorts of activities, but you might have higher healthcare costs.
So people need to be realistic about how
their retirements might unfold. Use

(39:31):
older adults in your life as an example of what you want
your life to be like, as well as things that you might, you know,
want to shy away from when you think about your own retirement. So
the "go, go," "slow, go," "no go," pattern is in fact
borne out by the data and people should bear it in mind when they think
about their budgeting. And that means that they can spend more earlier is the kind

(39:54):
of punctuation mark on all of this.
That's a good reminder and a good Way to look at at the cycle.
I wanted to share an anecdote. So being where I am today,
it's interesting when you said, Christine, dental work is one of the
biggest issues. I've heard that many, many
times in the past few years. And it's interesting that

(40:16):
the number of older adults that I've met that fly out to Columbia to
get dental work because of the fact that it's so much cheaper
than the out of pocket cost here in the US
and so they'll tell me, you know, there's 70 going, okay, I just need to
get dental work. It's $10,000 over here, it's $1,500 over
there and they'll make a trip out of it. But I found

(40:38):
that really interesting. That's a great reminder, I think, that
Lynnette khalfani-Cox, who's been on the show many times, she and
her husband, they have used medical tourism
and I forget where they went, but they got their teeth done and it was
a fraction of the cost. Pete, you wanted to chime in? Yeah, I did.

(40:58):
I want to just sort of play on what Christine was just saying.
And it's a yes and yes and expect the
unexpected. Because what we found is that
there's all kinds of different unexpected
spikes that might come up. You know, maybe suddenly you get this opportunity
to take a once in a lifetime trip. Maybe, you know, you want to pay

(41:21):
for a grandchild's college education.
And it's anticipating and mitigating because
things will change in retirement. And
preparing for those risks
with, you know, whether it's a buffer asset or some other kind
of contingency insurance is, is well worth.

(41:45):
Good advice. Let's go to segment four.
Retirement can bring emotional challenges, including feelings of loss,
loneliness and a shift in identity. Post retirement,
depression often presents as persistent sadness, withdrawal
or a lack of motivation. Recognizing these signs
and seeking professional support can improve well being.

(42:08):
Mindfulness and meditation help manage stress and improve cognitive
function. Simple practices like guided breathing or daily
reflection support emotional balance. Lifelong learning also
plays a role in mental wellness with activities like learning a new
language or taking online courses helping maintain cognitive health.
Volunteering provides purpose and social connection.

(42:30):
Engaging in meaningful work or mentoring opportunities enhances
well being and creates a sense of contribution. Support
systems including social groups and mental health professionals specializing
in geriatric care can provide guidance. Prioritizing
emotional health through engagement, learning and self care helps retirees
navigate this transition with confidence.

(42:59):
Christine, what insights do you have on the emotional side of
financial planning post retirement? Well, as I
said, Andy, I think it's super important for people to think
about some of the positive attributes that work confers,
such as identity, purpose, relationships, and be
preemptive about replacing them. And some of some people may

(43:22):
have had sort of parallel activities
alongside work all along that gave them those positive
attributes. And. But some people don't. And unfortunately, I think the
way that we work in this country is that people show up in
retirement completely depleted, and so they
haven't really been able to do any visualization beyond,

(43:44):
oh, you know, I want to travel here and there and I want to
watch this, this and this show on Netflix and get more
sleep. All great things. But you need to have
some visualization that goes beyond relaxation,
that your best relaxation is going to happen when
you're relaxing from something. So I love the idea

(44:07):
of people preemptively kind of looking around, maybe trying
out a few activities that they will pursue in
retirement. Had a wonderful conversation in my book
with Laura Carstensen, who is head of the Stanford Center
on Longevity. And she makes the point that
relationships, human connections are so important. And ideally,

(44:29):
if we are connecting with other human beings outside
with some physical activity, that ticks a lot of
boxes in terms of giving
us a lot of the things that we need to be happy later in life.
So if people can think about doing those three things,
ideally, maybe even all together every day, that will

(44:51):
set them up for, I think, a fairly happy and healthy
retirement. Pete, I think your experience
aligns with that. Oh, absolutely. And
beyond that, I would also say that once
you get to retirement, you're going to get all kinds
of advice from lots and lots of people. And

(45:15):
I guess my advice is take it all in, but then
take some time and just sit with
all of that. And then very, very. Because you're gonna, you
know, you got the rest of your life to plan. You know, take some
time to really think about what that's going to be like.

(45:36):
How do you do that? For you, you find that
spending time in nature... Oh, absolutely. pays dividends?
Absolutely. I got, you know, I got a, I got a place right by a
creek, right by the Santa Rosa Creek. And I, I go down there and I
listen to the creek and listen to the birds and, and let,
you know, let the, all of the noise and advice that

(45:58):
I've gotten sort of sink in and process.
Jason, what's your advice? How do you balance
planning versus going with the flow?
Well, I love that it's, I'm all about forest bathing.
Just walking into, into a forest and listening to the, to
the, the wind of rustle the leaves and the birds

(46:21):
and the creek and that, that helps us center and also
allows us to think and that solitude or even if we're there with a
friend or a partner and things like that. So I think that is really important.
What I wanted to focus on was this identity,
this idea of identity. So for the vast majority of us, our
identity is tied to our work and our profession.

(46:43):
So if we've been doing this work for 30, 40 years and then we
retire from that profession, all of a sudden our identity is
gone and it creates an identity crisis. And so when we're in
retirement, yes, we are inundated with
a feeling of euphoria and we're going to go like travel the world, we're
going to see our friends, we're going to eat good food. And to Christine's point,

(47:05):
it's important for us to think about what we would do on
a day to day. How would we fill up those eight hours
that was filled with that professional job or
what have you. And yeah, so the highlights,
the trips, the meals and things like that are great, but
it's also the downtime. And if you're finding that your downtime is

(47:28):
16, like, you know, 14, 16 hours a day of
relaxation, it's not going to be really relaxing because it's going to take a mental
and emotional toll because you're, because from going into like
extreme activity to pure relaxation after the
euphoria has died down, it's going to be a mental and
emotional spiral. And so I think

(47:49):
it's really important as, again, as we work towards
retirement to really think about
the things that we enjoy. So the moment where
we're not working, you know, figure out like, you know, find the interest,
find the hobbies. And I tend to tell people that,
you know, when it's like, oh, I don't know what I'm passionate about. Well, passion

(48:11):
is anything you put your time and energy into. And so when you go
out there and you explore, you take classes, you listen to people
speak, it sparks an interest.
And that interest can lead into a passion if you devote time and
energy into it. And we certainly and definitely,
and this is probably the most staunch advice I can give,

(48:34):
don't wait until quote, unquote retirement age to figure out
the things that you enjoy and like to do outside of your profession,
figure it out along the way and figure out how to
incorporate pieces of that into your day to day. And
eventually when you get to a point where you have to
or want to or need to retire, you're going to be able to lean

(48:56):
into those interests and you'll be surprised some of those
interests might turn into passions.
Jordan Grumet is in my
book and he talks about one
way to kind of think about how you might find purpose in
retirement is to take stock of the activities that you really

(49:19):
loved while you were a kid, but you had to sort of sit let
by the wayside. So the example he gives this base part
baseball card collecting that he loved hanging out with these other, I
think he calls them kind of misfit kids who were similarly
into collecting baseball cards and kind of discussing the
most valuable and he talked about

(49:41):
reconnecting with that hobby as something that he has enjoyed.
For me, bird watching was something that I
enjoyed as a young girl and I have recently reconnected with as an adult
thanks to the wonderful apps that are available to identify
birds around us. But to kind of take stock of those things
that you know where you got busy or you got engaged with

(50:03):
your academic and work pursuits that you had to sort
of let by the wayside, try to pick up some of those things
and chances are they will still be things that
light you up a little bit. So I think that's really nice advice from
Jordan. Thank you for incorporating
Jordan into this conversation. I finally did get a message

(50:25):
from Jordan and for some reason my calendar
invite, I know that Pete saw this, did something weird with the time
zones. So unfortunately we're missing,
we're missing Jordan in this conversation. Let's bring it home and go
to segment 5. Financial inequality
impacts retirement security, particularly for marginalized communities.

(50:48):
Expanding employer sponsored retirement plans, improving
access to financial literacy programs and strengthening government
incentives can help close the gap. Public and private sector
collaboration is essential in increasing retirement savings rates
among low income workers. Age friendly communities promote
accessibility through walkable neighborhoods, reliable

(51:10):
transportation and social engagement initiatives.
Local governments can prioritize infrastructure improvements while
technology solutions enhance connectivity for older adults.
Programs fostering intergenerational interaction help address
social isolation. Healthcare accessibility remains
a challenge. Expanding Medicare benefits, improving

(51:33):
telehealth reach and integrating long term care services can
reduce disparities. Policy advocacy plays
a role in shaping retirement wellness with organizations pushing
for financial security, affordable health care and
inclusive community development. Raising awareness and
engaging with advocacy groups can drive change, making

(51:54):
retirement more sustainable and equitable for all.
Jason how can financial literacy campaigns reach and
uplift underserved communities? So I

(52:15):
think one of the most important things is to meet people where they're at
and we certainly don't learn about money
using the languages that we use so if you're looking at targeting marginalized
groups, you're looking at targeting different segments of the population.
We need to have a better understanding of how that population
communicates and what are the specific

(52:39):
situations and challenges. So for instance, you know, speaking
in groups that I talk to and we talk about the long
term care planning aspect of it, if we disregard the fact
of the cultural aspect of having or wanting or
needing to take care of our aging parents, if we don't have that
type of conversation, then we're never going to be able to fully get people

(53:01):
engaged in the retirement planning aspect of it.
So I think it's really important to understand the community and use the
language and the specific situations when it comes to financial
literacy. Christine, what's the next frontier
in democratizing financial planning access?
One thing that has really worked in the realm of

(53:23):
financial education is "just in time"
financial guidance where at point of purchase, you're giving
someone just enough information to make a smart decision
about whatever they're embarking on, whether it's
taking out a loan to buy a car or allocating a
401(k) for the first time. If you can give them a little bit

(53:46):
of sane advice at that point of purchase, that is incredibly
powerful. We've also found that nudges really work.
So there was some seminal research published
several decades ago that pointed to helping
people just kind of find a sane choice.
So 401(k) automatic enrollment is the

(54:08):
best example of this. If you automatically enroll people in
and enroll them into a target date fund, oftentimes
they stay the course and they just keep investing. Those nudges,
I think can be extended further and I expect that we'll
see more on the nudge front in the years
ahead. The issue is that there's been a little bit of

(54:31):
pushback from some policymakers who think that it's a little bit too
interventionist. But we do see that nudges
really do help work in improving retirement
outcomes. And then I would have to say that
AI is also going to be a helper in terms
of being able to automate some of the financial guidance

(54:54):
that people currently get through planners, where, yes, we will still need
planners and advisors, but they'll be able to be in a
more sort of human position where they will spend time
understanding the person and what they want. And
then the financial plan itself can be
more or less automated with the advisor's oversight.

(55:15):
So I expect to see more on that front in the years ahead.
So to
Christineʻs point, with the AI, I really do think AI is going to be a
integral part of financial planning and the conversations we
have. And to that point of two of human emotional intelligence. The human
aspect isn't going to go away because money is very personal.

(55:37):
And so AI is going to be used as a tool. It's going to streamline
things and we're not going to get away from it. But it's also
important, I think those advisors and those planners who have
strong emotional well being in that dimension are going
to really excel when AI kind of takes over a lot of
the mundane aspect of financial planning. And so

(56:00):
that human emotional intelligence aspect of it is going to be
very, very important. Doc G.
Better late than never. My apologies for my scheduling snafu.
I'm just glad to be here. What have
you learned from your Earn & Invest community about
retirement readiness and where do you find the people

(56:22):
need the most help? Well, I think there are
two aspects people run into. One is no one ever feels
ready. Right? So regardless of they are or not,
sometimes the most engaged people still don't feel
ready. And then I think the second aspect is trying to
figure out this mix of what I think Jason was just

(56:44):
talking about this mix of
doing it yourself, using AI
and then using good financial advice. So I think what the future
really looks like is being able to integrate all three.
And I think a mistake we made in the past was we either thought we
could do it 100% ourselves, so we thought we knew everything and then we obviously

(57:07):
made mistakes when there was minutiae we didn't understand, or
the other side was we handed it all off to a financial advisor and
let them make 100% of the decisions without fully
understanding them. And so I think the future and what we're all trying to strive
for is to be able to integrate all three of those things well together
to create a financial plan that feels good and

(57:29):
provides us with what we need. Has anyone on
the panel asked AI for
retirement planning advice? Just curious.
I don't think I have. I've definitely run like
when there's new legislation, I've definitely gone to AI and said,

(57:49):
okay, how will this affect my taxes? And that's been relatively eye
opening. Yeah, I've used AI on different
financial planning aspect, not specifically on retirement. And
so it can generally answer
questions that are pretty basic. And the
big key things is that it doesn't really yet understand

(58:12):
kind of our own internal motivations and things like that. So it
definitely has limitations. Yeah, I mean, one big thing to point
out is even all of us, when we're involved
in our podcasts, our blogs, or giving financial
advice, one size fits all rarely works.
And so the question is, can AI integrate enough about who you

(58:35):
are and your specific needs to take general
ideas like the 4% rule and then
tailor those to fit your specific needs? And right now, human
beings are still better at that than any
automated system. It gets really interesting. I have to try it
myself. I haven't done retirement planning,

(58:57):
but right now I am shopping for a
new car. And historically I
always either paid cash or I
financed. Right? Especially if I could get a very low interest rate.
Now that interest rates are a little bit higher, I think that that's changed. But
I did put into AI. Can you compare for me

(59:20):
what a lease looks like versus
either paying cash outright or financing?
And my eyes are open because
those three choices are all open to me. But if I
lease a car with the plan to purchase
it at the end of the lease, I think it might end up being

(59:43):
better than financing. And
sure, I can pay cash and I'd pay less interest, but if I
lease the car, it might be a more effective way to keep my
cash available and invested and
buying the car. And I've never leased the car, so it'll be interesting

(01:00:04):
as I compare the numbers. AI is great for crunching
numbers and giving me different illustrations. Yeah. So
the really cool thing about AI is that it's able to do those things
and streamline the process of getting into getting a
series of solutions or answers. But because we're in the profession
and we spend a good deal of time understanding personal

(01:00:26):
finance concepts or and our education and experience are aligned
in finances, we understand when the information is factual
and correct. And unfortunately, when people are
using AI to find answers to their financial situations,
they may not have the experience or the background in finance
to determine whether or not that information is

(01:00:49):
correct and relevant. And so that's the issue that I'm seeing.
And so a few months ago, before I went on my social media hiatus,
I saw there was a trend on TikTok where people were uploading
their bank statements onto chat GPT and
telling them to create a budget. And I was like, no
way, stop. One thing, if there's advice

(01:01:11):
here is that do not upload your personal financial information
onto these ChatGPT-like
infrastructure because now that becomes part of quote unquote, the public
domain. And now your information is out there. But what on the
other end, what I realize is, is that people,
a lot of the younger generation, the gen Y and so and even some of

(01:01:34):
the younger millennials, they're really looking for answers and
they're going to lean more into AI. And so when we're thinking about retirement
planning, like decades from now for that generation, I mean, AI is going
to be so part of their life that it's going to become second. Second nature,
as search was for us. Generational
attitudes are so important in all of this. I think

(01:01:56):
people of my generation naturally assume that if you want a
correct answer about something, you reach out to another human being who's a professional
in this area. A lot of younger adults actually would
prefer not to get a phone call, not to have a
zoom meeting. They would rather text with a financial
advisor. So I do think that generational attitudes are

(01:02:19):
a super important component about what
someone will receive and, you know, how they will
incorporate that information into their financial decision making.
Thank you, Jason, for the words of warning.
Yeah, no, I'm part of that generation where. Text me before you call me.

(01:02:42):
Pete. I want to get to you. You lost your home
or your, your house was damaged by the glass fire of
2020. How did that expose you to
different communities and maybe inform your thoughts
on retirement planning, accessibility,
sustainability and inclusivity? Well, absolutely.

(01:03:04):
As you say, I lost my, my entire home in the glass fire in
2020. And I, for four and a half years, I lived in the poorest
section of Santa Rosa,
met a whole bunch of wonderful, wonderful people who didn't had very
limited access and also big, big problems with
the system, the paperwork, the

(01:03:26):
bureaucracy. And what I found is
having a bit of expertise and being able to help
one on one was so rewarding and people were
so grateful. So I came away thinking that one of the
solutions is just people like us and just people with
expertise going out into the communities and helping

(01:03:49):
and sitting with these folks who struggle and
help them figure it out. One question I have for you, Pete,
on that, I've wondered about that and volunteered at some pro
bono events. And
an impediment has been that I do not have a great
working knowledge of getting out of credit card debt

(01:04:12):
or how to improve credit scores. I know a lot about
helping financially well, people do better with their portfolios, but I
felt deficient in terms of what I could offer people.
I maybe know an above average amount about some of those things, but
not a lot. So how did you get up to speed on those things that
you needed to in order to be helpful? Well, it turns

(01:04:34):
out that, you know, in the land of the blind, the one end man is
king. I mean, people would come to me with, you know, problems on their,
their car insurance. And, you know, I, yeah, I'm an
actuary, but I don't know anything about car insurance or how, you know,
how, you know that claims management is
done. But, you know, their people were getting messed

(01:04:56):
up and it was messing up their financial life. So you just look at what
they've got and, and try to figure it out and make sure you don't say,
now take this to the bank, or I believe, you know, I know this. I
don't tell people about, you know, that I know something I don't.
But it turns out that people's problems are often very, very
basic and can be thought through with just a little bit of background

(01:05:17):
knowledge. Yeah, that's, that's great. One thing I learned is that
credit scores are king. Right. I remember helping someone in my life
work on her auto insurance, and I was like, what on earth is
going on here? It turns out your auto insurance rates are affecting
by whatever your credit score is, which was something I was unaware
of. Yeah, yeah. One thing I've learned

(01:05:41):
when I do these events as well, these pro bono work in the communities I
serve is that I do not know the answers to everything. All I need
to know is the people or my network that may have the
answers to these questions, and I'll lean into them or refer them.
Pays to be a good listener.

(01:06:01):
Well, I want to thank everybody for joining today. This has been
a very informative conversation. Lots to think about as we
plan for our futures. One of my biggest takeaways from today's
panel is that retirement is not an end, it's a
beginning. And the most successful retirements aren't just
financially secure. They're intentional, purpose driven,

(01:06:23):
and emotionally secure, fulfilling. So whether you're nearing
retirement early on in your journey or somewhere in between,
the real goal is to design a life you don't need to take
a break from. One that reflects your values, supports your wellness, and
keeps you connected. Here's one assignment for you, Inspired Money
Maker. Take 20 minutes this week to write down

(01:06:45):
your vision for retirement. Not just the numbers, include the
numbers, but also think about your life.
What does a meaningful day look like? Who do you want to be
with? What are you doing? Then ask yourself, what
small step can I take now to start living that vision
today? And then you can reverse engineer that back

(01:07:08):
to your finances. So thank you for being here with us. If this
episode resonated with you, share it with a friend or loved one who's
always thinking about their next chapter. And let's keep
the conversation going. And oh yeah, if you're on LinkedIn,
let's connect. Find Me by searching "Advisor Andy." Inspired
Money is created and produced by me and Bradley Jon Eaglefeather.

(01:07:30):
Bradley is behind the scenes during the live stream. He edited
the segments. Chad Lawrence does our graphics, animations
and editing. Before we part ways, I
want to give a big shout out to our guests today. If you found
value in today's episode, go follow their work and keep
learning from the best. Follow Christine Benz Morningstar.com. "Buy

her book "How to Retire (01:07:52):
20 Lessons for
a Happy, Successful and Wealthy Retirement."
Expand your investing horizons by listening to her
The Long View podcast where she is a host.
Connect with Pete Neuwirth at
neuwirthassociates.consulting or

(01:08:14):
capacuity.com. Check out his books "What's your
Future Worth?" and "Money Mountaineering." Visit Jason Vitug
at phroogal.com and don't miss his books. "You Only
Live Once," "Happy Money, Happy Life," and "Make Your Money Smile."
Thank you to Jordan "Doc G" Grumet for
coming in and showing up. My

(01:08:36):
apologies again for messing up the scheduling, but
make sure you subscribe to his Earn & Invest podcast.
I love the work that he's doing there. I also am
a big fan of his books, "Taking Stock" and "The Purpose Code." Do you
guys have anything that you want to plug? Any upcoming events
or things that you want to share? All right, one quick

(01:09:01):
thing I'd mention, Andy, is the Jonathan Clements Getting Going
on Savings Initiative for people who want to contribute to a
501(c)(3) charity that is going to help
set up young working adults with Roth IRAs. They can
check us out on at the John C. Bogle center
for Financial Literacy where we are funding the initiative. Oh

(01:09:24):
that's great. I'm a big fan of Jonathan Clement and was very
touched by watching one of his
YouTube videos where he shared a terminal diagnosis. So
my my thoughts and wishes go
out to him and best wishes on that project. Inspired
Money returns next week on Wednesday. That's July 23rd

(01:09:46):
at 1pm Eastern. Our topic will be
"Unlocking the power of Entrepreneurship Turning Ideas into Profitable Ventures."
Thank you for joining us today.
I look forward to seeing you next time. Do something that scares you
because that's where the magic happens. Thanks
everyone.

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