This is how to enjoy your retirement

Aug 01, 2019

The accumulation phase

During your accumulation phase, it can help to think of think of your personal wealth in 3 ‘wells’:

Well 1 – Liquid funds (<12 months)

These liquid funds can be actively managed, and while not a significant percentage of your overall wealth, should be large enough to cover your day-to-day bills and living expenses for the coming year;

Well 2 – Living, lifestyle, and leisure (2 to 5 years)

A second well of money which can also be actively managed to cover upcoming living expenses, holidays and travel, car upgrades, home renovations, school fees, and whatever else is on your 2 to 5 year horizon.

These tend to be reasonably liquid funds, most often a balance between stocks and cash; and

Well 3 – Longer term and legacy (to retirement & beyond)

These are your safer, long-term investments that you ideally never have to sell until your retirement, typically including property and, for some, safe investments in large, established, systemic companies which throw off strong income streams.

I discussed this concept a little further here.

The retirement phase

Have you ever thought about how you’ll generate income in retirement?

Or what happens if markets take a big downwards plunge just as you’re heading into your final years in the workforce?

While long-term market trends might seem reasonably predictable, the sequence of returns from year to year can vary dramatically.

And this can be inconvenient if the drawdowns happen at just the wrong time.

In fact, the range of outcomes arising from sequence of returns risk can be eye-popping, depending upon when you’re withdrawing from your ‘retirement account’.

Thankfully, there are a number of ways to mitigate the risk.

You could simply spend less in retirement; or you could be flexible with your spending depending upon how things play out.

Or you might choose to take volatility out of the equation altogether by seeking a fixed income, although such a level of certainty may come at a cost.

But this is by far the most enjoyable way to enjoy retirement, especially given the significant increase in life expectancy these days.

Please watch the video here

Whenever you’re ready… here are 4 ways we can help you manage your own money and go next level wealth:

  1. Boom or Bust in 2021 – 20 minute online workshop for investors

Register for my next free online training - Boom or Bust? How to change your investment plan for 2021 - book in here

  1. Subscribe to our Top 100 Podcast for Investors

 Listen in to our new podcast - The Low Rates High Returns Show - Apple Spotify , SoundCloud

  1. Join our Implementation Program

We’re putting together a new coaching case study group this month for private investors. If you’d like to get the plan, tools and timeless principles for managing your money and creating next level wealth … just send an email to [email protected] with the word “Case Study” and we'll get you more details.

  1. Work with me privately

If you’d like to work directly with me and Stephen Moriarty directly to help you map out and action your next level wealth plan… just send an email to [email protected] with the word “private”… tell me a little about your situation and what you’d like help with, and we’ll get you all the details!