I’ve said this before and I’ll say it again: you can pontificate and spew out all the retirement advice you want, BUT unless you are retired yourself, you know absolutely nothing about retirement. It’s all conjecture. Period.
Suze Orman, financial genius of our time, has a new book out entitled: The Ultimate Retirement Guide For 50 +. In it, Suze gives us an updated account of “winning strategies to make your money last a lifetime”. The advice is updated because Suze has been retired now for a few years and finally, she knows a thing or two about the realities of a real retirement! Been there. Done that!
Orman’s chapters are situated in such a way that you can start anywhere, based on your own life preferences. You can Read Chapter 4 first (as I did) ‘Where To Live‘ and then skip over to Chapter 6 ‘How To Pay Yourself In Retirement (and not run out of money)‘ as I read in that order also. It didn’t take me long to figure out that Suze’s retirement advice was based on her own current retirement strategies and discoveries.
For instance, in Chapter 4 ‘Where To Live‘, Orman recommends downsizing BUT you don’t have to downsize to another state, place and time. Nope. You can now downsize your retirement life and make it more affordable if simply moving down the block affords you a more sustainable lifestyle. That only comes from personal knowledge. How many retirees sold their marital domiciles and downsized to Florida or Arizona only to discover within 6 months they made a terrible error in judgment? They hated Florida or Arizona and wanted to move back up northeast where their friends and family were. Ka-ching! Great big waste of money. Staying put and relocating to a cheaper side of the same town would have solved their affordable housing retirement needs.
Live and learn.
That’s what hubby and I did. We downsized and re-located within our same state of New York back in 2001 when we retired young and foolish. We went from a very expensive area ($5600 a month) to a less expensive upstate area ($2400) a month) and have lived retired happily ever after, ever since. Who knew that twenty years later Suze Orman would catch up to our way of progressive thinking? Been there. Done that.
I’ll give you another Orman highlight. Fast forward to Chapter 6 ‘How To Not Run Out Of Money In Retirement‘. Know what the great Suze Orman suggests? The woman who touted that retirees needed $4 to $10 million dollars to adequately retired now states the following revamped advice:
Calculate your reliable income sources (there are 3 of them) and structure to pay your living expenses from your guaranteed income. Your 3 sources of such income is:
- Social Security (duh!)
- A pension (double duh!)
- Income from your investments, such as an annuity (WTF duh?)
Remember the good old days when Suze used to scream at the top of her lungs during her reign on the CNBC Saturday night Suze Orman Show to not, not, not ever buy an annuity? She hated those things. Now, not only is she touting the joys of annuityhood but she’s advising people that their monthly basic living expenses better match up against their Social Security checks and pensions and NOT a penny more. So much for having that $10million dollars in the back. The most people get from SS is approximately $3200 and pensions are a thing of the past. So, basically Suze is telling the masses to sharpen their lower income level skills cause that’s what they’ll be retiring at when the time comes.
People, I’ve been touting this very same advice (living off your secured income) for the past two decades and I have never even met the real Suze Orman. According to my own retirement experiences and the uncertainty of life on this planet (think 9/11, The Great Recession and the current Pandemic) retirement needs to be based on the sure thing. Wall Street and the fluctuations of the bond market are not to be calibrated into anyone’s guaranteed income! Hubby and I have a guaranteed, stuck-in-stone retirement income of $3088 a month. That’s 2 Social Security checks, 1 lowly pension check and the balance is steady investment income from locked-and-loaded FDIC CDs.We live on about $37,000 a year. Stick that in your pipe and smoke it!
I don’t have any experience in finance such as Suze Orman. I only have real life retirement experience. Apparently, my plan works because Orman now touts my mad methods. To me, it was common sense. Retirement means learning to live on a lower income for most people. NOT the other way around. Get those images of chaise-lounges, salty beach breezes and endless golf courses out of your mind, STAT! Retirement is a serious subject and should not be taken lightly.
Another move Orman recommends people master in their retirement so they don’t run out of money is to ‘Know Your Expenses‘. Orman states this may sound basic but her experience is that most people do not know what they spend per month. Typically with people is they underestimate their actual spending by at least $500 or more. If you’re supposed to be managing your expenses on $3200 a month, being off by $500 can be a bit offsetting.
If you get the chance, I recommend Suze Orman’s latest book. Orman retired at age 65. Now, five years later, she apparently has a revised set of retirement advice she’d like to share with you. I’d give it a whirl.
Experience is the best teacher.
Live and learn.