Do you know your retirement number? Is there a magic number that exists? How useful are retirement calculator tools? We dive into all of this today. By the end of this episode, you should be able to tell when you have enough. Stay tuned to combat that scarcity mindset that may be telling you that you’ll ever have enough.
I’m thrilled to be diving into this topic with Megan Hammann, the Director of Financial Planning at Wealthquest. Megan has an MBA, experience at a brokerage firm, large bank, and a CPA and advisory firm. She’s been at Wealthquest since 2022 and is excited about helping clients align financial goals through a holistic planning process.
[03:51] When people ask what their retirement number is they really want to know if they're going to be okay.
[04:29] There isn't a magic number that works for everyone. Everyone has a number that makes them feel comfortable, but there's so many variables that we don't know what that number is.
[05:46] We know parts of the puzzle, but we won't know the number until we put all of the pieces together.
[07:21] Life changes, so it's hard to know what we actually want in retirement especially when it's so far in the future.
[08:03] What do I like to do? How will I spend my time? Have a general vision of where you'll fall.
[09:15] Calculators usually ask general questions about your assets and your earnings etc. Then it generates a model based on when you want to retire. This can be a ballpark datapoint but not specific enough.
[10:28] Megan talks about the 4% rule. You can also estimate retirement by percent of earnings. There's also a 300 rule. How much do I want to spend each month?
[12:05] There are goalposts at certain ages for retirement savings.
[12:56] It's important to understand that our income and earning life aren't linear. There will be times when we have more money and times when we need more money.
[13:45] If you really want to know if you have enough, do a full financial plan.
[14:23] Having as much information as possible can help offset the fear of the future that some people have.
[16:59] We talk about catching up on our retirement savings. Focus on you and stop comparing. Find where things went wrong and do a self-assessment and use the tools available to get on track.
[18:49] Balancing can be hard. There are more ways to save. Follow general guidelines. Err on the side of retirement first. Put your mask on first.
[21:12] There's a whole other side to retirement when you think about the psychological impact. Finding purpose and knowing what retirement actually looks like is very important.
[22:44] It's important to have open communication about what life will look like after retirement.
Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the CFP® certification mark, the CERTIFIED FINANCIAL PLANNER™ certification mark, and the CFP® certification mark (with plaque design) logo in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.
Resources & Links Related to this Episode
- Wealthquest Get Started
- Living a Rich Life: The No-Regrets Guide to Building and Spending Wealth
- Megan Hammann