Review of: How Much Money Do I Need to Retire

How Much Money Do I Need to Retire? 60 Minute Financial Solutions by Todd Tresidder Published by Financial Mentor.com.

Summary:

Tresidder starts with asking the reader to answer 7 questions to figure out how much money they need to retire.

His 7 questions are:

How much income is needed; what is the impact of inflation on the income needed and how does your expected lifespan affect that amount; what will your pension and/or Social Security pay during your retirement; will your investments grow between now and the time you die; what will be the sequence of good and bad investment returns and how old will you and your spouse be when you retire.

He then goes into depth on each one as to how it can impact your needed asset base for retirement.

He suggests that traditional retirement planning tools are flawed and that it is the assumptions you make that can cause the results to vary widely. He dives into reasons a ‘safe’ withdrawal rate isn’t safe with multitudes of math and examples and then presents his answer to retirement planning.

• Figure out how much you need
• Figure what won’t be covered by pension or Social Security
• Figure out how much of an asset base you need to generate enough dividends or interest to cover the difference.

He also covers confidence intervals, his way to use retirement calculators, key numbers he think impact the security of your retirement, discusses changing your retirement lifestyle to reduce your income needs, including extra types of income (such as income producing real estate) in your calculations and cash flow calculations.

Read this book to understand and address:

IF you have relied totally on retirement calculators to figure out what to save for retirement, you can pick up some valuable insight into some other ways to think about retirement income needs by reading this book.

What I liked:

Todd presented some interesting ideas, along with many commonly accepted methods of calculating money needed for retirement. He not only covers what is needed, but how to take income out when you are retired.

What I wished for:

I felt the chapter on valuations was unnecessarily complicated and wished it could have had a short version.

Favorite quotes:

“Just look at that list of skills and knowledge required [to figure out how much you need to retire]. Nobody knows when they will die, what inflation will be or what their investment portfolio will return. It’s not only impossible, it’s ridiculous.”