What’s the Difference Between an Old Man and an Elderly Gentlemen?

An old man is somebody that runs out of money. An elderly gentlemen is a man that doesn't. Which do you want to be?

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Here’s a question. What is the difference between an older man and an elderly gentleman?


An older man is someone who has run low or runs out of money.  Money provides choices. When you run out of money, someone else makes those choices for you. Where you will live, what you’ll eat, how you’ll live, where you will go. An older man has lost control of his life, subject to his now limited income and his currently limited choice.

An Elderly Gentleman is in TOTAL control. Because his money hasn’t run out, he chooses where he lives,  how he lives, what he eats, and where he goes.  The Elderly Gentleman has planned never to run out of money!  He has designed for sustainability. It sounds simple.

The older man didn’t plan to run low or run out of money. Exactly!  He didn’t plan.

The Elderly Gentleman did plan, and that’s the difference.

It’s all well and good to rely on assumptions:  How long you and your spouse will live, what your living expenses will be 10, 15, or 20 years down the road — what your health will be, etc.

But isn’t it better not to assume? We have no guarantees about any of those things. FAR better to PLAN for the worst (that you and your spouse will live a long time, your living expenses, taxes, and healthcare will all increase, and your health will get worse the longer you live.)

But that’s only part of the equation.  How do you transition from the accumulation of assets to the income phase of your life-your retirement years?  And, how do you ensure that your withdrawal rate is sustainable?

So, HOW to do this?

Well, first of all, just like an addict first needs to recognize the problem and admit it. EACH  of us needs to get our heads out of the sand and face up to the absolute need to plan while we still can.

Sit down with your spouse:

-PLAN that you and your spouse will live another 25 or 30 more years.

– Now look at your income: assuming you’re not working—we can’t work forever, right?: Company Pensions, Social Security, Annuities, Dividends, interest, Rental income.

Now add up the income that is guaranteed: Social Security? Annuities? Company Pensions? The other income-generating assets are NOT insured.

-A plan that your expenses will exceed your costs today.

– Realistically, look at your checkbooks and see where you are spending your monies. Make a list of “needs” and “wants.”  Then estimate what those expenses will be 25 or 30 years from now.

-Realistically look at your financial assets. Can you guarantee that those funds will always grow if you have stocks, bonds, and mutual funds? Remember,  when you start withdrawing, you start losing the compounding effect, just as you do when you take losses.

So, HOW much money will you need in Retirement? Impossible to say! Too many things we don’t know and can’t predict. My answer to that question is, “all you can get your hands on!” Or a better way to put it, all you can guarantee is that you won’t run out, no matter how long you live!  You can’t have too much money.

The trick is to leverage the amount of money you have now. Could you make the most out of it? Stretch it out!

Make sure it never runs out!

But do it on guarantees,  not assumptions.

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