this is the best preretirement and postretirement planing book I have ever read. I will hold a series of meetings/discussions to review concepts introduced in the book and have a open discussion on the topics covered. All are encouraged to join.
Want to be added to my notification/email distribution list? Email me at MoneyMatters_2022@ArtCentrics.com
The purpose of this book is to introduce a technique developed by the author Henry Hebeler know as Autopilot use for developing and implementing both a saving plan before retirement, and a spend-down plan after retirement to ensure your retirement is fully funded for you life.
Chapter 1 Compares some of the more popular planning methods to the Autopilot method using real-world historic data.
Chapter 2 identifies the factors that need to be taken into consideration when developing a plan including Savings, Life Expectancy, Inflation, Taxes and Uncertainty.
Chapter 3 dives into investments covering Asset Allocation, Investment Vehicles and Real Estate.
Chapter 4 is devoted to determining Return on Investment, reviewing factors that need to be considered, and instructions on how to determine what Return on Investment to expect for the asset allocation that represents your portfolio.
Chapter 5 focuses on Pre-retirement planning, providing a step-by-step detailed instructions in building and implementing your plan.
Chapter6 is dedicated to budgeting and planning after retirement to ensure you set expectations based on what assets you have accumulated, and details a process to re-assess and make appropriate adjustments to ensure a successful implementation of your retirement plan.
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Meeting Agenda: Each meeting will be focused on one of the chapters in this book. You can download/view my chapter summaries here. Please Note: This document will be updated on a regular basis, so make sure you download the latest version.
Last Updated: 2022-03-14
Most data presented here is dated. Tax laws, stock quotes and the general economy changes on a regular basis (yearly, weekly, daily). Information provided here is just the starting point. It is up to you to ensure you have the latest information.
Guidance and advice provided here is just my opinion. Guidance and information is just from what I have learned through the years. I have no degree associated with money, and have no certifications associated with finance. Take all information provided here with a grain of salt and verify with other resources before making a decision.
Your situation is unique - Advice or recommendations provided here may NOT be appropriate for your situation. Financial moves and investments that a person in their early 20's may be completely in appropriate for someone who is retired. Also investment considerations and moves are dependent upon what your total financial resources are. Consider if the advice given is appropriate for your situation.
Website: Analyze Now! - Mr. Hebeler's website
This chapter details the process of planning, executing and maintaining a budget in retirement. It shows how using the Autopilot method can be used to ensure you have adequate funds to keep the same lifestyle that you have projected in your pre-retirement planning. It also helps identify the order you should tap accounts in the spend-down phase of your retirement.
Gate 1: Understanding the Fundamentals – Forecasting your future needs.
Gate 2: Organizing Your Inputs to the Plan – Integrate one time expenses in your plan.
Gate 3: How Much Can You Afford to Spend? – Determine how much you can spend each year for normal living expenses.
Gate 4: The Retiree’s Autopilot? – Review of autopilot parameters that can be adjusted to smooth out market gyrations.
Gate 5: Staying on Track – Steps to ensure you keep to your plan in previous gates.
Gate 6: Always Look Ahead – Live events to keep in mind including critical dates, estate planning etc.
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We continue our pre-retirement calculations completing the following gates:
Gate 3: Estimating Fixed Income Streams - Identify resources that do not come from savings such as Social Security, Pensions and Annuities.
Gate 4: Retirement Autopilot - A detailed analysis using the retirement autopilot to calculate how much you should save on an annual basis.
Gate 5: Just before Retirement - Nailing down your future retirement date.
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Before diving into chapter 5 we will briefly review a couple of papers originating from the American Association of Individual Investors that address Asset allocation and diversification, identifying a number of approaches and index funds that can be utilized to build your portfolio.
Diving into chapter 5 is where the rubber hits the road. We are introduced to a number of worksheets used to determine your current retirement situation, how to determine your future needs, and finally how to determine the type of lifestyle to expect in retirement. We also discuss how to evaluate an early retirement offer if your company offers you one. Finally, this chapter discusses options on what you might consider to meet the lifestyle you want in retirement if your current situation doesn't appear to support the lifestyle in retirement you would like.
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Interlude: Index Fund Investments
Paul Merriman: Which is the Best 1, 2,3 and 4 Fund Strategy (2020-09-23)
Chris Pedersen: Simple & Effective Balanced Portfolios for Lifetime Investing Success (2020-10-22)
This chapter is focused on the concept of Return on Investment (ROI) aka Returns. This may be the single most important input in your retirement planning and execution, so it is vital you understand how it works and how important it is to try to get as accurate measure and estimate of this value to be used in your calculations. This chapter also covers how to measure performance of your investments to determine if a new strategy is in order.
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We Continue Chapter 3 with Vehicles, followed with allocating within vehicles.
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Chapter 3 is focused on Investments and identifies the various types of investments (ie stocks, bonds, etc) the various types of accounts (ie vehicles) created for holding these investments ad finally introduces the concept of Asset Allocation, a process of distributing your investments across various risk level investments to minimalize risk and maximize gains. The importance of placing investments in the appropriate vehicles to minimize tax implications is also discussed. Finally some thoughts on the appropriate approach to creating a plan and implementing it based on the level of involvement you desire are discussed.
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We Continue Chapter 2 with more definitions then discuss unplanned expenses. Finally we introduce taxes and how to determine what you Net Tax Rate is.
Resources:
Webex Recording (1:00) (MP4 Format).
This chapter points out the importance of having pre and post retirement plans on how to save and spend-down your nest egg. It identifies risk of out-living your savings and provides real-world scenarios on how some of the various approaches would have faired in different historic market conditions. Common mistakes and incorrect assumptions that many plans make are identified. A side-by-side comparison on how theses methods would have performed in comparison with the Autopilot method is provided.
Resources:
Webex Recording (1:00) (MP4 Format).
This chapter points out the importance of having pre and post retirement plans on how to save and spend-down your nest egg. It identifies risk of out-living your savings and provides real-world scenarios on how some of the various approaches would have faired in different historic market conditions. Common mistakes and incorrect assumptions that many plans make are identified. A side-by-side comparison on how theses methods would have performed in comparison with the Autopilot method is provided.
Resources:
Webex Recording (1:00) (MP4 Format).