The Retirement Marathon: Finishing the Race

Well, hello and welcome in to Mr. Stillman's Opus. I'm Ben George.

He's John Stillman over at Rosewood Wealth Management. John, I know you're an athlete, but are you much of a runner? Because there is a difference. I would not describe myself as a runner. No. I mean, there have been times in my life where I have gone for a run a couple of days a week and was in pretty good shape. That is not my preference now if I'm going to do any form of cardio. It's going to not be in the form of running.

So, no. Not a runner. Definitely not a long-distance runner. Not even chasing down the goats and chickens and that sort of thing? Well, see, that's all in short spurts. And it happens several times a day where I have to keep the goats out of my blueberry patch. Fortunately, though, it's not a long distance.

It's just frequent. Well, there are definitely people that are built for long-distance running. So, today we're going to talk about the retirement marathon. So, this maybe is something that you cannot relate to in terms of I've experienced the marathon, I've run a marathon.

My wife has run one marathon, so she could, but I could not speak to any of the training or any of the feeling of running at 26.2. But there are some things we can take away from long-distance running and finishing the race. As we want to talk about today with retirement, it's very much like a marathon. It's a long-distance run. You got to really put in the time and stick to your schedule and your process to get to the finish line and enjoy that success at the end. So, let's jump into this, John, and talk about this. Because even though we're not, I'm assuming you ever run a marathon, right, John?

That is correct. I've run, have I even been in a proper race? I don't think I have. Not even a 5k? I volunteered at a 5k one time, if that helps. But yeah, I saw a guy with the sticker on the back of his car the other day that just said 0.0.

Clearly a nod at the people who have the 26.2 sticker on the back of their van. That's funny. Yeah, I've done a couple 5ks, but that's about the extent of it. So, let's start first with planning and preparation. Because, you know, people might just assume, okay, you need to just run. Run a lot, right? You're going to be running long distance. So, just get out there and run a lot every day and that'll get you to where you need to go. But I've seen it firsthand with my wife scheduling. Like, there is a lot of thought that goes into what you should be doing each and every day. Not even just from a running standpoint, but obviously from a health and a needing standpoint as well.

Yeah, well, I have to tell you, I always thought that that's all there was to it too. One day you run a mile and the next day you run a mile and a half and the day after that you run two miles. And if you just do that, let's call it five days a week for a couple months, guess what? You'll be pretty dang close to marathon length at that point and then you just go run the marathon. Go sign up.

But no, that's not how it works. Having talked to a couple of friends who have trained for marathons, you, in a lot of cases, spend up to six months in training getting ready for the marathon. So you might mix in some light runs on some days. You might have other days with long runs that are more meant to simulate the marathon. Other days, shorter, faster runs to chasing the goats out of the blueberry patch, if you will. You might have other days where you don't run at all and it's just muscle recovery. You might have days where you're lifting, you're doing leg workouts and not running.

So yeah, there's a lot of different ways you can approach it, but it's usually not just as simple as, well, let me just start running and I'll run a little bit more every day until I'm running a long time. Well, same thing with your retirement plan. Just like you don't run out and do a long run every single day when you're preparing for the marathon, you don't necessarily want all of your money invested in a long run marathon type of approach. So sure, if you're 35 and you're saving and investing for retirement, yes, that is long-term marathon type of running that you want that money to be doing.

Let it ride the roller coaster. It doesn't matter if it's up big or down big right now because you're in it for the long run. But let's suppose that you have some money that you want to save for the purchase of a house in four or five years. Well, that money is not going to be riding the roller coaster in the same way.

You don't want it exposed to as much aggressive risk because your timeline is shorter and you don't have time on your side for recovery after you take a big hit. So you end up with different types of money with different jobs that are going to be invested in different ways. So we have to determine what the job of that money needs to be. Is this money that is on the long run day or is this like a short light run day or is this a lifting day? What job do we need that money to do?

And then once we identify the job, that's when we can determine how it needs to be invested. Is this long-term retirement money? Is this short-term investment? Is this just savings that should just be in the bank because we need it in eight months?

Is this legacy money? All those things are going to necessitate very different investment choices by virtue of the job we need that money to accomplish. All right, we're talking about the retirement marathon. And of course, along with that planning and prep is the diet. As I kind of mentioned before, you got to eat correct in order to give yourself enough energy to get yourself into peak performance mode when it comes to running that marathon. So how do we take these lessons of diet and eating properly and applying them to retirement? There was a very great man who once said, I did 100 crunches every day because I really wanted a six pack. And then I was talking to a trainer and he said, great abs are not made in the gym. Great abs are made in the kitchen. And so I started doing 100 crunches every day in the kitchen and that didn't seem to work either. What he's saying is if you want to have the six pack, really it's more about diet than it is exercise.

It's a myth. A lot of people think, well, a lot of cardio gets you ripped. Well, diet is the way you control that much more like go study. I know you've done this a lot, Ben, is study the workout and diet plans that these guys go on before they're in a superhero movie.

I'm sure you've based a lot of your life choices around that. So the diet is the focus of it. It's not that they're not working out, but to look the way that you want to look to be in a superhero movie, the main event is the diet. So before a marathon, what are people doing? They're doing they're doing the carb load to prepare in the days before the race. Hopefully you're not doing it the Michael Scott way from that episode of The Office where he's starting off the race with a plate of, I don't know, linguine or something in his hand that he's eating as the race starts. That's not how you want to do the carb load.

You want to start a little bit earlier than that. But the idea is that the body burns carbs more efficiently than it burns fats. So having the right amount of carbs in your system helps your performance while you're running. Well, with retirement planning, you want to be paying really close attention in those years leading up to retirement to your portfolio diet, if you will. You can't afford big losses at that point. It's important that you have the right diet and that you're properly managing risk. I see people all the time, in fact, have somebody in the office just this week, Ben, who was saying, you know, I've been in this fund for 25 years and it's done great for me, so I just want to keep riding, you know, dancing with the girl that brung me, right? Well, that's fine as an approach, but what you're telling me is you invested in this particular way at 40 and now you're 65 and telling me you want to retire in two years. You should not have the same investment approach at those two different ages.

Your diet needs to be different and so a lot of people just haven't adjusted their investments to reflect the stage of life that they're in and it's really important that you do that. All right, let's go with this one here. I know this is one we can't relate to. Again, we haven't got in there, but I would imagine if we were to run a marathon, we'd know, hey, let's don't start too fast, John, and use all our energy right here off the back of the off the bat.

So, with retirement, same thing, right? You don't want to hit the ground running. I know it can be exciting because it's that new transition, a lot of free time, a lot of goals ahead of you, but you still don't want to start too fast, right? So, I have a real life example of this. In elementary school, every year we would do something called the fun run, which usually proved to not be so fun for most of us elementary age boys. So, you know, you take all the kids from your grade.

Let's say it's fourth grade. I guess there was probably a boys race and a girls race. So, let's say there were 60 boys from fourth grade participating in this fun run. So, everybody lines up and you're supposed to run down to one end of the football field and then back down to the other end of the football field and then you snake off over here and they have this course set up and let's say it's a mile run for a bunch of fourth grade boys. Well, what did most of us do? 60 of us all together at the starting line, which is a horrible system by the way, but all of us take out like we're shot out of a cannon for that first stretch down the football field. So, we get down the football field once, we go through, turn through the end zone and come back down the other end of the football field.

Well, by the time we've run those couple hundred yards, most of us are completely shot because we were all trying to win this little short race, but inevitably you'd have two or three guys that would do well for the entire race because they had the endurance and they were smart enough to not run as fast as they could for the first hundred yards of the race and they'd end up winning and most of us couldn't even run for the entire mile because we'd run so hard out of the gate. So, I've seen people do this with retirement. It's tempting to spend too much money in the early years of retirement, especially if you had a job where you just weren't allowed much time, not much free time when I say not allowed. I don't mean like you were working in some kind of factory chained to your sewing machine. I just mean the demands of your job were such that you couldn't take very easily a two-week vacation to go do the big trip that you wanted to do.

Maybe you had that many vacation days, but for you to be gone from work for two weeks, it was just it was too much work for you before you left and after you got back to take that kind of time off. So, you end up in these situations where you say, ah finally I'm free. I can go do all the things that I've always wanted to do and there's not necessarily a problem with that if we've budgeted accordingly. Like I have several clients where we have planned for this, where they are going, it's understood as part of their retirement plan, they are going to spend more money in the first five years of retirement than they're going to spend in years six through 25 or however long their retirement lasts.

But we've budgeted for that and we have assets placed accordingly so that we know they're going to be fine. Now, it's possible that you might be in a position where you could actually spend more than you think you're going to spend more than you think you can. Like I've seen people who retire and then feel like they can't do anything fun because they have to spend as little as possible in order to stay retired. When maybe that's not actually the case for them, that's just how they feel. And the reason they feel that way is because they don't have an income plan that shows them, all right here's what you can spend, here's how we can show you even if you do spend this amount and you go do that trip and you do give that money to the grandkids or whatever it is, here's how you're still going to be fine.

And here's how we can show you mathematically how you're not going to run out of money when you're 90 because you spent too much when you were 68. And so often what that income plan does for some people it can be a limiting thing to say well look you need to spend no more than this. But for other people it's a very liberating idea to say oh I can spend this much and still be fine.

So I would actually say the income plan is liberating for more people than it's limiting for if that makes any sense. I have more clients who have to be told yes go do it, go spend the money, go do that thing. I have more people that I have to tell that to than I have people where I'm saying all right guys let's tap the brakes a little bit here, you're getting out of control. So really important that you have that plan in place so that you're running at the correct pace throughout the race of retirement. Well good stuff John you spoke like a guy that's been in a number of 26.2s in the course of his lifetime.

I've talked to enough people who have done it I guess and very proudly cannot conjure up in my mind a situation where I would run a marathon. Well it's probably that you've just spent so much time on the retirement marathon side of things that you could speak to the planning and preparation and execution so well which we appreciate here on the podcast. And again if you haven't started planning and preparing and doing the proper dieting so to speak for your retirement now is the time to hop on that and take care of that and start that process. So again rosewoodwealthmanagement.com is the website and you can call or text John at 800-545-2991. All right John I'm sure the goats are probably back in the blueberry patch by now so we will wrap it up and talk soon. I will do one of my short sprints out there to take care of it right now. Carolina Weldstords Doing Business as Rosewood Wealth Management is a registered investment advisor in the state of North Carolina. The material presented is intended to be general information and should not be construed by any consumer as the rendering of personalized investment advice.