55+ Living Guide Magazine Spring/Summer 2018 Spring 2018 | Page 42

By Bob Lowry | Visit: satisfyingretirement.blogspot.com
Thou Shall NOT:
1. Spend more than you make
There may be times in your life when this was necessary. Few of us can buy a house or
car without taking on debt and a total obligation well in excess of our cash flow. College
education for the kids, major medical bills...life happens. Having the ability to borrow
money and temporarily go into debt is OK. What can quickly ruin your retirement, how-
ever, is spending on wants and desires in excess of what your income is. The basic rules
of finance don’t get suspended once you cash your last paycheck. Funding your retire-
ment with credit cards, home equity loans, or other options that put you in a perpetual
hole will only get deeper.
2. Ignore the need for a budget
Closely related to the point above, I don’t know how you can make it if you haven’t kept
and maintained a budget for years in advance of retirement. That need continues. In
fact, when regular paychecks stop, tighter control over your income and expenses is
even more vital. The old rule of thumb is you should plan on spending roughly 80% of
what you spent before retirement. I suggest that “rule” no longer applies. You should
develop a budget based on your resources and what you think you will spend. If those
two numbers work for you, then the percentage is not terribly important. But, you must
maintain a budget.
3. Assume others will take care of you
By others I mean the government, your old employer, your family, or winning the lottery.
We are living in a period where personal responsibility must be your primary care pro-
vider. It is likely you will receive some assistance in the form of Social Security and Medi-
care. If you have a pension you may receive everything you expect. Your family very well
might be there for you every step of the way. But, I strongly urge you to plan as if none of
that support will be there when you need it, not because I am overly cynical but because
ultimately whatever happens will fundamentally affect your life, not theirs.
42
55PlusLivingGuide.com