Things I worried about before retirement:
1. Sequence of Return Risk [SORR]
I spent a lot of time and effort on this. I delayed retirement, adopted a more conservative asset allocation, and piled up cash. But as it turned out, SORR wasn't an issue for me.
[I retired in 2012.]
If I had to do it over, I would still do all the research and make the same preparations for SORR.
Better safe than sorry.
2. Health Insurance
Again, I spent a lot of time researching this. I maintained my Scorp for several years into retirement for medical insurance. I used ACA when it became available. And then Medicare.
If I had to do it over, I would make the same decisions on health insurance.
3. Income Stream
I spent a lot of time researching this, but there is no substitute for the actual experience.
After I retired, I tried the "selling a few shares" strategy to provide an income stream. I didn't like it. Mostly because every sell decision is an opportunity to make a mistake. In what to sell, how much to sell, etc.
If I didn't need the cash, I didn't want to sell. But that meant when I did need cash, I had to make decisions relatively quickly on what and how much to sell.
When you are 55, deciding which stocks to sell to fund expenses seems like an acceptable plan.
When you are 75, it might be a struggle to make that decision correctly every time.
[My sell decisions are complicated, e.g. taxes, rebalancing, risk diversification, future income stream effects, asset allocation, estate planning, etc.]
For my stocks/funds that are in taxable accounts, I take the dividends and cap gains in cash and spend them. That meant rearranging my portfolio a bit. It took me several years to figure this out. I got to where I wanted to be, but I could have gotten there sooner.
4. Roth Conversions
I came up with a general plan for Roth conversions and I'm generally following it.
5. Cash bucket cushion
I chose to have a cash bucket cushion because of SORR, but also to avoid making any hasty decisions early in retirement. Eventually, my SORR risk evaporated and my cash cushion got invested. [I still have an emergency fund.]
Things I did not worry about before retirement:
A. What to do in retirement
Many people (including my spouse) thought I would have a problem finding something to do with my former "work hours". I spend 0 time planning it.
After retirement, I bounced around trying a bunch of different things.
Within a year or two, I found things I enjoyed. Even the "bouncing around" was pleasant.
B. Spouse dying
My spouse died 4 years after I retired. I had no plans for it.
Yes, we had an estate plan with wills, trusts, DPOA, etc.
But that seemed like the distant future in 20 or more years. Bad surprise.![:confused]( "confused")
But I don't know what I would have done different for this.
1. Sequence of Return Risk [SORR]
I spent a lot of time and effort on this. I delayed retirement, adopted a more conservative asset allocation, and piled up cash. But as it turned out, SORR wasn't an issue for me.
[I retired in 2012.]
If I had to do it over, I would still do all the research and make the same preparations for SORR.
Better safe than sorry.
2. Health Insurance
Again, I spent a lot of time researching this. I maintained my Scorp for several years into retirement for medical insurance. I used ACA when it became available. And then Medicare.
If I had to do it over, I would make the same decisions on health insurance.
3. Income Stream
I spent a lot of time researching this, but there is no substitute for the actual experience.
After I retired, I tried the "selling a few shares" strategy to provide an income stream. I didn't like it. Mostly because every sell decision is an opportunity to make a mistake. In what to sell, how much to sell, etc.
If I didn't need the cash, I didn't want to sell. But that meant when I did need cash, I had to make decisions relatively quickly on what and how much to sell.
When you are 55, deciding which stocks to sell to fund expenses seems like an acceptable plan.
When you are 75, it might be a struggle to make that decision correctly every time.
[My sell decisions are complicated, e.g. taxes, rebalancing, risk diversification, future income stream effects, asset allocation, estate planning, etc.]
For my stocks/funds that are in taxable accounts, I take the dividends and cap gains in cash and spend them. That meant rearranging my portfolio a bit. It took me several years to figure this out. I got to where I wanted to be, but I could have gotten there sooner.
4. Roth Conversions
I came up with a general plan for Roth conversions and I'm generally following it.
5. Cash bucket cushion
I chose to have a cash bucket cushion because of SORR, but also to avoid making any hasty decisions early in retirement. Eventually, my SORR risk evaporated and my cash cushion got invested. [I still have an emergency fund.]
Things I did not worry about before retirement:
A. What to do in retirement
Many people (including my spouse) thought I would have a problem finding something to do with my former "work hours". I spend 0 time planning it.
After retirement, I bounced around trying a bunch of different things.
Within a year or two, I found things I enjoyed. Even the "bouncing around" was pleasant.
B. Spouse dying
My spouse died 4 years after I retired. I had no plans for it.
Yes, we had an estate plan with wills, trusts, DPOA, etc.
But that seemed like the distant future in 20 or more years. Bad surprise.
But I don't know what I would have done different for this.
Statistics: Posted by doobiedoo — Sun Apr 07, 2024 2:45 am — Replies 12 — Views 1749