Speaker 1: Today, we’re going to be talking about the importance of some vision planning as it relates to retirement planning.
I’m Jessica Cannella, co-founder, and president of Oak Harvest Financial Group. I’d like to begin this discussion by giving you an example of why it is so important to have a conversation about your retirement vision as you’re having a conversation about your retirement planning with a financial advisor. Have you ever put together a puzzle with your family? Maybe you’re at the lake house, the cabin in the mountains, or at the beach. You spread out this giant 100-piece puzzle, where do you start with that puzzle?
Now, I’ve asked this question when I do live workshops with my prospective clients, and the answer is very common that they’ll tell me, “Duh, you start with the corners of the puzzle so that you can then build the inside.” I’ve only ever had one individual provide the answer that I am going to answer for you right now. I argue that it is not the corners of the puzzle that you should be starting out with. It’s the cover of the box. You’ve got to know what that puzzle is supposed to look like before you can go ahead and start to design it on the surface that you’re working with.
I believe that retirement planning is no different. When we talk about retirement planning, we’re often talking with today’s longevity of a 30, even 40-year time horizon, at least 10, 15, or 20 years that we’ve got to plan for, and that’s very, very big and intimidating, just like that gigantic puzzle when you first dump it out of the box. It’s critical to understand what do you want your retirement to look like before you go ahead and start putting numbers to paper and actually planning that.
Sharing with your professionals, your financial advisors, CPAs, estate planners what you want your life to look like in retirement is going to pave the pathway for them to understand what type of income do they need to be supplementing from your portfolio in order for that to happen. We’ve talked it out in another video the importance of the go-go years, the slow-go years, and the no-go years relative to your retirement. That’s one way that you can begin to break down the picture.
If you haven’t checked out that video, go back to our playlist and seek that one out. That does a nice job of providing a good overview of the retirement life cycle as it relates to retirement planning. Today, I want to talk to you about specifically retirement vision planning. Now, full disclosure, I work with a lot of engineers here in Houston, and I’ve had a couple of eye rolls when I’ve asked for people to go ahead and do this exercise.
Don’t worry, it’s not a physical exercise. You don’t have to do jumping jacks or anything, but I have people who generally come into my office and especially if they’re of the engineer variety, and they want to jump right in and start talking about things like social security maximization, and how to save on their taxes and whether or not they should be contributing to a Roth or doing conversions. I’ve often got to back them way up. What they just did was come in and dump the puzzle on the table for me, and I want to know what it’s supposed to look like on the cover.
I’ve gotten a couple of eye rolls because I actually will send people home with some homework. I believe that this exercise is best completed in the comfort of your own home. I’ve asked my clients to go ahead and write in a stream of consciousness their perfect weekend in retirement, and that can sound a little bit woo woo, but when we’re talking about a 30-year time horizon, that is very overwhelming. Again, it’s puzzle pieces on the table, out of order, chaos. If you can bring that vision down to just one weekend, it’s going to be a lot more comfortable for you to start to really visualize what retirement means to you.
It’s a big transition to go from working for 20, 30, 40 years to not working. Now, I’ll say I do hear this all the time, “I found plenty of things to do while not having anything to do,” but life is sweet, this is the next chapter. In order to really feel like you’re having a fulfilling financially free and fearless retirement, consolidating your thought process down to just one perfect weekend in retirement is often the first step to take, especially when you work with myself.
When I get the eye rolls from my engineers, I’ve actually gotten a retirement vision back in the form of a spreadsheet, that was interesting. My favorite was it was written on the back of a napkin, but all it is, is a simple three to five-minute exercise. I had somebody tell me once that they don’t have a timer. I told them, “That’s great, use the microwave that has a timer on it or your cell phone as a timer on it.” Because I want you to take this seriously. You’re just going to take three to five minutes if it goes longer let it happen. Put pen to paper, not keyboard to a spreadsheet. [laughs] This is best done from your hand getting it out of your soul and onto paper. I want you to just focus on what the perfect weekend in retirement looks like for you.
Some of the questions that I give is prompts for this stream of consciousness to begin our questions like this. Who are you with? Maybe you’re by yourself. Maybe you’re surrounded by friends or family. Maybe it’s a girls’ trip or maybe you’re with your significant other or with the grandkids. Really channeling, “Who am I with?” If it’s the perfect weekend in retirement, who do I want to be spending my time with?
What are you doing? What are the smells, sights sounds around you as you’re going through this exercise? One of my clients told me that she was in a little café in the middle of Paris by herself. She worked a job where it was around a lot of people for many years and she just wanted the solitude and to be sipping a little cup of espresso and watching the sounds and sights of Paris. I thought that was wonderful.
She was one of the people that balked a little bit about doing this but with tears in her eyes when she was sharing with me her vision exercise, she explained to me that she didn’t realize how much she needed to have some alone time and really just enjoy the world as it was unfolding around her instead of being in constant chaos like she was during her working years.
She went on to write for 20 minutes in this example. Not only did she speak about being in that café in Paris, but she also went on to speak about what her intentions were to do when she got home. She wanted to do repairs on her new home and she wanted to be volunteering with her lady’s group at the church and for MD Anderson for cancer research. She had all these plans and she just had them on paper. When she was reading them to me she was like, “Okay, I can see why I did this now.”
For someone that can’t the answer is now we know how you’d like to be spending your money in retirement. Now, your professional team, especially at Oak Harvest Financial Group, the dream team can go ahead and start putting the financial puzzle pieces together to make that retirement vision come to fruition. One very important thing about retirement planning and vision planning is that it’s not a one-and-done. This is the next chapter of your life. Things are going to change especially over a 20,30-year, and 40-year time horizon that we’re looking at.
It’s crucial that you put pen to paper whenever it’s on your heart, or at least have the discipline of doing it twice a year because your plans are going to change. Also, life is going to change. It’s very important that we are sharing what our vision is for retirement, what’s working, what’s not working with our team of professionals so that they understand what is truly important to you with your money. I believe that money is so much more than a means to an end. I believe that money is freedom, that money is permission to live your life the way that you see fit.
It’s our protection. Life is a lot easier when you’re a good steward of your money. It is just so much more than sticking it into a portfolio or an annuity or a long-term care policy or 401k all of the different tools that we have. Those are just tools. The main question is what do we want the money to be doing? Sharing your vision statement with your financial advisor can really go a long way. This is a practice that I really love to incorporate, especially when I have folks that come in and they have no idea what they want to be doing in retirement.
A quick anecdote I just thought of. I had a couple that came in and it was very enlightening. They each did the exercise individually. If you are married, I recommend don’t do it together to start. It’s fine to do it together and share your visions as a great date night but do it independently because what’s on your heart in retirement might not be the same as your husband or wife.
In this particular instance, the polar opposite. His vision was like, “I want to be working in my woodshop on my lake at Lake Conroe here in Texas.” Hers was that she wanted to be at the beach in South Padre Island at their condo. They were laughing the first time they had shared was in our conference room and they had to come to some compromise with their vision statements. It really allowed for us to see how is that applying to their financial plan.
The numbers, the financial statements, the documents needed to do a retirement plan that is easily accessible. We have analysts that can put all that information together for you. I love numbers. Numbers also tell a story but that vision statement and really checking in with yourself and your spouse on what is important to you when you retire, that is the best story to be told, and to be shared with a financial planner. Because it’s going to help them put the numbers to action for you.
I hope you found today’s session valuable on vision planning, I do have a prompt list. I don’t know what to call it. Like a little work exercise that we can drop in the description box for you to get access to. Gentlemen, morning. It’s a little girly, I use it at my women-only seminars, but this is an exercise for everybody to do, to really hone in on your retirement vision, and a wonderful way to start the conversation with a financial advisor.
Also, I wanted to take this moment to tell you a little bit about the next series that we’re going to be giving, which is talking a lot about money mentality and how to override some of your money mentalities that you may not even know that you have. Please join me in our next series for our money mentality. I look forward to seeing you back here soon. Thank you.