How Will You Replace Your Income in Retirement? | 003

Episode 003: How Will You Replace Your Income in Retirement?

Have you heard of the post-World War II financial planning strategy known as the “Three-Legged Stool”?

Well, on this episode of The Retirement Equals Freedom Podcast we’re here to introduce you to the latest and greatest 21st century alternative! Host Josh Bretl, a CPA and owner of FSR Wealth Strategies, is explaining his “Pockets on Your Pants” model for spending in retirement.

Income is the No. 1 concern he sees among clients contemplating their long-term financial prospects – and from the sound of it securing a revenue stream is also on sidekick Dave Schmidt’s mind! The two discuss what “The Great Resignation” means in terms of future financial security, how the “retire at age 65” standard came into being (pretty random, actually) and why younger generations are ordering some of their priorities differently (embracing side hustles and skepticism about the corporate paycheck way of life).

All that said, whatever your approach, everyone benefits from having an actual framework written down, along with realistic milestones and contingency plans for those unexpected rainy days. And speaking of those rainy days? Nothing could be more comforting than Market Day Chocolate Chocolate Puddin' Cake.

We know that makes no sense, but listen in and thank us later!

The show wraps with just a little brainstorming. For future planning, here’s a possibility: The Retirement Equals Freedom Podcast co-hosts record while enjoying a “Happy Hour” featuring a tasting of our favorite handcrafted bourbons. Discuss amongst yourselves!

Chapters:
0:00 Josh's opening remarks
0:19 Dave introduces the episode
1:10 20 second dance party!
1:35 Chocolate Puddin' Cakes and retirement?
6:25 My paycheck is gone. Where is my money going to come from?
12:50 Pockets on Your Pants analogy
23:55 Josh's Full House moment - Tying everything together
24:45 Wrapping things up
26:40 30 second dance party!

Key Takeaways:
All about how to think about income throughout your retirement years. It starts with one basic principle: Locking in a stream that is predictable, safe and secure.

A look at some of the approaches to securing income, historically and over time:
• Commit to one employer, do the time and retire on a pension. (This option mostly doesn’t exist in the modern workplace outside of government and education.)
• A “three-legged stool,” the legs of which usually vary in size: Social Security proceeds; Some sort of fixed income (an annuity or pension); Savings, which vary considerably among people with different profiles.

Josh has an additional approach to propose: He calls his model the “Pockets on Your Pants.” Various streams of retirement income can come from lots of different pockets, but it’s important to know what’s there, what’s where and have a written plan.

When planning for retirement, the immediate, medium- and longer-term horizon have to be taken into consideration. It’s essential to be looking at least a few years ahead.

Josh projects that the population will live longer and have to work longer to maintain services and a desirable standard of living.

Demographically, Baby Boomers and Gen Xers have the older, traditional mindset while younger generations are unspooling and reconceiving what it means to work, ways in which to work and for what length of time.

Whatever your approach – whether you’re leaning towards a non-traditional work life that doesn’t anticipate retirement or dream of a fixed date on which you’re done, having cash reserves is never a bad idea. It provides peace of mind like nothing else!

Keep on keepin' on,
~ Josh & Dave

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FSR Wealth Management is a registered investment advisor located in Elmhurst, Illinois. Information and opinions contained in this video have been arrived at by FSR Wealth advisors. All information herein is for informational purposes and should not be construed as investment advice. It does not constitute an offer, a solicitation or recommendation to purchase any security. FSR is not providing legal, tax, accounting, or financial planning advice in this video. These views are as of the date of this publication and are subject to change.

Episode 003 originally launched on May 5th, 2022
Topics covered in this episode are not topical, as we talk about more high-level things such as the mindset change needed to thrive in retirement.