By John Patrick Foley, CFP®, ChFC®
Summer is (unfortunately) coming to an end. The days have already been getting shorter. The air a bit crispier. The kids are back to school. Work is ramping up and traffic is starting to get heavy again.
At least you had your vacation.
Many hours were spent planning your leisurely getaway. First you had to figure out where you will be going – beach or road trip? Stay in the U.S. or travel internationally? Then how you will get there – drive, plane? Where can you find the cheapest flights? What about hotels? What activities are you going to do so the kids won’t be bored? Or so you won’t be bored?
Like I said, you spent a lot of time in planning this trip. And you’re not alone. A study from Charles Schwab found that 39% of the 1,000 respondents spent 5 hours or more exploring vacation possibilities. Another from Mass Mutual puts that number closer to 42%. So go ahead, continuing spending that time planning your next trip with the comfort that there are 39% - 42% of you doing the same.
But, beware. That same Charles Schwab study found that only 11% said they had spent the same amount of time evaluating investment options for their 401(k). The survey from Mass Mutual said only 32% plan every detail of their retirement plan. Should you put at least same time and energy into planning your retirement as you do your vacation? I think so… and then more time on top of that. Here’s why.
Retirement is a 30 year vacation.
Yes, it’s true. Think about that for a moment. According to Transamerica, workers age 50 and older are planning to retire at a median age of 67, although that same study found that the actual median retirement age is closer to 62 (I will get into the reasons why in another post). The longevity age estimates in the 2000 Individual Annuitant Mortality Table, provided by the Society of Actuaries, shows that if you are a 67-year old married couple, there is a 25% chance that at least one of you will reach age 97. 30 years. A 10% chance that at least one of you will reach age 101.
Listen, I’m not saying to spend less time planning your vacation. Go ahead, you’ve earned it. Just do me favor, spend a little more time planning your retirement too. Reach out to us, we can help you be part of the 11% who spend 5 hours or more on their 401(k) investment choices and the 32% who plan every detail of their retirement plan. You’ve earned that much too.