Christine Benz knows a lot about managing money and saving for retirement. For decades she’s been a personal finance columnist for Morningstar, the influential investment research company. Benz has demonstrated her expertise in books like 30-Minute Money Solutions and The Morningstar Guide to Mutual Funds.1
But as she was conducting research for her latest release on how to retire, she realized she’d been missing something. She discovered that she needed to take a step back and see the bigger picture that asset accumulation is just one part of: Creating a retired life that has purpose.
“Retirement is not a math problem,” Benz told MarketWatch. “People might be surprised to see a book from me that is half nonfinancial—maybe not even half. But I feel like people are overly focused on the financial and not enough on the nonfinancial.”
In preparing to write her book, Benz interviewed twenty other well-known financial experts on specific topics.2 For example, she spoke with Mary Beth Franklin on Social Security, Ramit Sethi on optimizing happiness, and Jean Chatzky on what women need to do differently.
Benz said that as she talked to these people who are known for their financial expertise, she began to understand the importance of the nonfinancial, softer aspects of retirement planning, such as finding your purpose and thinking about your legacy.
When individual investors focus solely on the nuts and bolts of asset allocation and income strategy, it’s easy for them to ignore these equally important factors.
Facing her own retirement, Benz lists three questions she needed to ask herself:
What will animate me and give me purpose later in life?
What will I do with my relationships?
How will I maintain those relationships?
Answers to these nonfinancial questions must come before financial details like “How much money will I need to save?” and “How should I draw down my nest egg?” Because when you’re planning for this new phase, your purpose in life should dictate your financial decisions, not the other way around.
There is a lot of math in planning for retirement, especially as you seek to diversify for the long-term and maintain your flexibility. But if you try to reduce it to an algorithm, you could miss out on the key components that make retired life most fulfilling.
See if you can answer Benz’s three questions for yourself. Your trusted fiduciary financial advisor is happy to help you flesh out the nonfinancial factors that make life worth living.
If you ever have any questions about your investments or retirement plans, please feel free to give me a call at 801-545-0696.
Regards,
Mark Lund
Stonecreek Wealth Advisors, Inc.
10421 South Jordan Gateway, Suite 600
South Jordan, UT 84095
Sources:
1. http://go.pardot.com/e/91522/ents-top-math-experts-7c0a3dc6/965f9q/2596920147/h/H1A93oBpfQiq9t9KV6EX3kJ-S1a4gc6P-xmEuEFrEv8
2. http://go.pardot.com/e/91522/howtoretire/965f9t/2596920147/h/H1A93oBpfQiq9t9KV6EX3kJ-S1a4gc6P-xmEuEFrEv8
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