Nervous to Retire on a 401k? This Is For You
THE BIG THING I WANT YOU TO KNOW:
The first generation to ever retire on a 401k is nearing retirement! Yes, it’s nerve-racking, but creating an income plan that’s dynamic, that leaves room for unexpected change, is the key to being at peace with retirement.
It is perfectly normal to be nervous about retirement… It’s never been scarier than now.
It makes a lot of sense why people preparing to retire are nervous. If you are getting ready to retire, you are the first generation EVER to retire on a 401k. This sounds scary…but it doesn’t have to.
I’m going to talk you through why nerves are normal and how to plan for retirement.
How Did We Get Here Is Really Important to Understand — Let’s Re-Introduce Ourselves to The 401K & When It Was Created
I grew up in the eighties, and I don’t remember a time that retirement wasn’t associated with 401k. I figured that was just the way it had always been, but 401k’s didn’t exist until the late seventies and weren’t really introduced to the general public until the early eighties.
401k’s weren’t really introduced to the general public until the early eighties
Before 401k, most people had pensions. Pensions were individuals retirement plans.
When 401k’s came in, instead of a guaranteed income for life, the government decided that you would put money into this plan and they would match it and you’d make millions by the time you retire and we’d all live happily ever after. Sounds great, right?
Narrator Voice: That’s not what actually happened. Tune in to the next paragraph to see how retirement planning feels so scary today.
here’s what happened next… It’s not great.
What actually happened was we saw tremendous growth in the eighties and nineties, but when the 2000s hit, we saw three of the worst market crashes ever. 2000-2010 was the worst decade for the market since the Great Depression, and suddenly all these dreams of the market making us millionaires with our 401k’s fizzled out.
But here’s the key: no one has ever retired with a 401k until now.
So yeah, of course it’s scary! This wave of retirement is embarking on an unknown and told to “feel amazing.”
my financial advice to you, retirees who need confidence in your plan:
Don’t live in fear, worry, and anxiety about this. The number one thing to focus on as you near retirement is income planning, and this process is divided into two approaches:
Basic income planning
This is based on everything going according to plan. You save how you planned to save, worked as long as you planned to work, retired when you thought you’d retire, etc.
It’s all happiness and butterflies!
Advanced income planning
Here we’ll start to throw curveballs at your plan. What does your plan look like for income if one of you becomes really sick? What if one of you passes away unexpectedly? What if the market crashes right as you are about to retire?
Sounds like a fun meeting right!? (Sorry, but honestly this type of meeting is my favorite.)
I know it doesn’t sound as fun as the happy butterfly meeting, but if we can simulate all these things and show you that your plan can bend and change and still work—that, my friends, brings peace.
Life is dynamic, therefore you need a dynamic plan
Instead of imagining some perfect world where everything goes right, we put your plan into the real world.
You don’t have to be caught off guard when something unexpected happens and wonder what’s going to happen. You can have a plan that’s built for the real world.
Listen, feeling nervous is normal but there are simple tools that can eliminate your fear and offer up a peaceful alternative despite what happens in life.
We call this company Dynamic Money for exactly THIS reason. Dynamic means there is some give, some stretch that can handle movement and can handle a fall. We want you to have a plan that is dynamic, not a plan that is built to only work in the sunshine and roses world.
If you want that kind of plan, if you want to feel confident about your retirement plan, sign up for a free consultation with our team. Our desire is to help you create a plan that you can feel at peace about not only blindly hope everything works out.
If your younger self saw your life today, what would most surprise them?