As we continue to settle into our new house, we keep learning new things about country living. One thing we've discovered is that now that the dogs are fenced in, we can give them a little more freedom. Apparently, dogs love to roll around in gross, smelly things. Penny came back yesterday exuding such a stench that we had to scrub her down three times with strong shampoo.
Penny also found a rabbit den. Luckily, she's timid and small, so she didn't know what to do with those furry little creatures—except bark. I ended up covering the den with grass again. The rabbits were quite big, and according to Google, they are close to leaving the nest.
My wife is a talented thrift shopper, and she is putting the final touches on some of the home's needs. It truly is incredible what you can find. Just yesterday, she discovered a $60 dresser (with a few scratches) that I swear is worth ten times that amount.
Dalanee is going up to Chicago for another round of Botox treatments. We are very hopeful and excited, as her headache symptoms have significantly improved. While she still has bad days, there are many more good days now.
Below you can see Grammy helping Jesse with his piano lesson.
Retirement Panic vs. Retirement Peace: A Tale of Two Johns
Let’s take a little stroll through the anxious brain of a brand-new retiree who’s doing everything wrong. Then, once we’ve wandered down that rabbit trail, we’ll rewind and approach things from a healthier, more logical angle.
Sound familiar?
Meet Mr. John Jones, 65, and his brain (also 65). This conversation took place the week before his retirement.
John vs. the Panic Spiral
John (thinking):
Hmm... next Friday’s my last paycheck. Then it’s just Social Security. Jane and I should get about $4,500 a month together. Is that enough? It doesn’t sound like much.
Let’s see… Property taxes are $5,000 a year. Homeowners' insurance is $3,800. Car insurance is pushing $2,000. The electric bill averages $250 a month…
Wow—we spend a lot. How much do we spend each month? Honestly, I have no idea.
This might not work. I have $700,000 in my IRA, but I can’t just spend it. What if I run out? I also have a CD and a savings account, each with around $50,000, but that won’t last long either.
What am I going to do?
Wait—my IRA is invested in the stock market. Should I still be in stocks at my age? What if the market crashes? That guy on the radio says we’re “due.” Maybe I should get a part-time job. I think Home Depot is hiring. They pay around $17 an hour. If I need $2,000 more per month, I’d have to work—hold on—120 hours a month? That’s full time!
Okay, think, John. I’m 65. If I live 20 more years, $700,000 divided by 20 is $35,000 a year—just under $3,000 a month.
Hmm… Maybe that could work?
But what if I don’t die at 85? Jane’s mom is still kicking at 95. If I go at 85 and Jane lives another ten years, she’ll be broke. Poor thing’s already put up with me for 40 years. Better plan for 35 years, not 20.
Oh no. I haven’t even considered inflation. $6,200 a month might not cut it ten years from now. What then?
I need a drink.
Maybe the financial news will help…
John vs. Logic and a Plan
Same John. Same life. This time, a little clearer thinking.
John (thinking):
Alright, last paycheck is next week. Jane and I are expecting $4,500 a month from Social Security. Before I panic, let’s sit down and figure out what we actually spend.
(John spends a couple of hours creating a real, honest budget.)
Last year, we spent about $75,000—that’s $6,250 a month. I’ll round it up to $6,500 to be safe.
So, we need $2,000 extra per month beyond Social Security. Where’s that coming from?
Well, I have $700,000 in retirement savings. Divided by 20 years, that gives me $35,000 a year, or just under $ 3000 a month.
That works—but wait. If I live longer than 20 years, then what?
Ah! I’m forgetting the most important part. My investments will keep growing in retirement.
If I withdraw 5% a year—or around $35,000 annually—I’ll still leave the bulk of my nest egg intact and have a strong chance it lasts as long as I do. That’s about $3,000 a month from investments. So I'm only spending the money that the money is making. We this plan, we'll still have $700,000 in our 90's. That makes me feel better.
Add that to Social Security, and we’re at nearly $7,500 a month. More than enough. And it's a plan that would last as long as we do.
And I’ve still got $100,000 in CDs and savings for those big one-offs: roof, car, or emergency dental work when I chip a molar on a peanut brittle. Plus, I might pick up a few shifts at the golf course—not because I have to, but because I want to. That money can fund our vacations.
Yes, the stock market has bad years. But my advisor, Dave, won't shut up about how it all works in the long term. I don’t need to predict the future; I need to trust the plan.
Also, Social Security is inflation-adjusted. If inflation goes up, so do our checks. And studies show we’ll likely spend less in our 80s than in our 60s—maybe even 30–40% less.
So, I’ll stop watching the financial news, cancel that Money Magazine subscription, and start focusing on life again.
Jane and I have worked hard. We’re not going to spend our golden years worrying about the sky falling. It’s time to live the life we saved for.
Moral of the Story
See the difference? A little planning goes a long way. You don’t need to be a financial genius to retire well—you just need a calm head, a sensible plan, and maybe a calculator.
The truth is, very few retirees end up living in a Walmart parking lot. I’ve talked to hundreds of folks in their final chapters, and you know what they always tell me?
“I don’t know how… but everything turned out ok.”
Be Blessed,
Dave
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