Ep. 292 – How to Retire at 62 in 2026 With Peace of Mind
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In this Episode of the Secure Your Retirement Podcast, Radon and Murs discuss:
How to build the foundational steps for retiring at age 62 and achieving peace of mind in retirement planning. They dive into the critical questions that need to be answered, the data required to assess retirement readiness, and the steps to create a retirement roadmap. With this episode as the first of a two-part series, Radon and Murs explain how understanding your financial situation and goals lays the groundwork for a secure retirement.
Listen in to learn about:
· The key elements of a retirement-focused financial plan and how to gather the right data.
· Why organizing your accounts and understanding assets is essential for retiring comfortably.
· The importance of identifying income sources like Social Security, pensions, and other retirement accounts.
· How to categorize your retirement expenses into essentials, wants, and legacy goals.
· The role of regular plan monitoring to adapt and adjust your retirement roadmap over time.
In this episode, find out:
· The initial steps to determine if retiring at age 62 is feasible.
· How to use the Peace of Mind Pathway to clarify retirement goals.
· The importance of understanding and organizing investment assets.
· How to plan for retirement expenses, including big-ticket items.
· Why estate planning and understanding liabilities are vital for retirement security.
Tweetable Quotes:
· “Retirement planning is about aligning your ins and outs: what you’ve saved and what you’ll spend.” – Radon Stancil
· “Gathering the right data upfront is the foundation of any successful retirement plan.” – Murs Tariq
Resources:
If you are in or nearing retirement and you want to gain clarity on what questions you should be asking, learn what the biggest retirement myths are, and identify what you can do to achieve peace of mind for your retirement, get started today by requesting our complimentary video course, Four Steps to Secure Your Retirement!
To access the course, simply visit POMWealth.net/podcast.
Here’s the full transcript:
Radon Stancil:
Welcome everyone to Secure Your Retirement podcast. Today we’re going to talk about something that many people start to find out usually about the end of the year or the beginning of the next year, variety of different reasons as to why they might be thinking about retirement. You could have been approached with a very good exit package that says, Hey, if you take this package, you are going to be retired with some extra money. Others could just be like, Nope, I’ve been planning for retirement and this is what I want to do and I’m thinking about it ahead of time. So here’s the premise of this conversation. We are going to set the tone or the circumstances here and you could change it to your circumstances and we could apply this to whatever we want to apply it to as far as timeline goes. But for this particular conversation, we are going to say that we have an individual, she is going to be retiring and her goal is to retire in the year 2026 when she turns 62.
Okay? Now she’s kind of been looking at her financial situation. She thinks that she’s on track. So now in this particular setting we’re going to say that she has approached us and she is sitting down and she’s saying, I want to know is it even possible? So to give you the context of what we would do is we would take her through what we call our peace of mind pathway process, where we’re going to walk her through, we’re going to build out a few different elements, and the very first thing we’re going to do is say we want to build the peace of mind roadmap. Now under that roadmap, we got a lot of things that we’re going to look at. So the question is how are we going to get it? What’s that conversation going to be like so that we can help her determine whether or not she can retire in 2026 at age 62?
And the pros and cons, we’ll take it all through all kinds of scenarios. So just so you’ve got context, we’re going to do this as a two-part podcast series. So in this particular one we’re just going to say, what information do we need? What’s that conversation going to sound like? And then in next week’s episode, we’re going to take you through the analysis of that and we’re going to share our screen and we’re going to share with you what that plan can look like and how we walk through the scenarios because it could be a lot of different scenarios that we will come out of this. So what we’re going to do now is just kind of, obviously we’re going to need general information about them, but we’re going to skip over and say what do we need to know about their financial situation so that we can be able to help them to do this analysis of whether or not they can actually retire in 2026 at 8 62? So I’m going to travel to Mercy. He’s going to kind of talk us through what we would need to know about the assets.
Murs Tariq:
So essentially what this is going to be is taking somewhat of an inventory of what this person has done thus far to get to where they are in the stage in their career. And then we take that data and that helps us kind of extrapolate out and say, well, is it possible to retire at 62? And then also, what are the things that we have to think about along the way? And the question, the burning question is, is it going to work and how well is it going to work? The only way to get those types of answers and start getting that direction is to get good data upfront as we start to build out the plan. And so we ask all clients and anyone that’s meeting with us to fill out a snapshot of their financials, and it’s not getting into the nitty gritty of everything.
We just need to get a general idea upfront of the different types of accounts we have, the different ways that we’ve saved and all these other items around goals. What do you want out of retirement? What documents do you have in place? So I’m going to walk through a little bit of the reasoning as far as why do we ask certain questions and why do we need those answers? So on the asset side, we state pretty simple at first. We’ll start asking questions around or ask them to fill out on the document, Hey, what about what’s your cash in the bank? So some people will make that as simple as in the bank I have x. Some people will make it even go further in depth of saying, well, in my checking there’s this in my money market, there’s this, I have these CDs. And then if we know there’s CDs, we need to understand the maturity of them also understanding what type of rate that they’re paying to make sure it’s worth locking up that money in a cd.
So understanding your cash in general, cash on hand and cash as an investment. We also want to understand if there’s life insurance out there, what type of life insurance do you have? Is it term, is it permanent? If it’s permanent, what’s the purpose behind it? Is it for death benefit? Is it for cash value growth for future income purposes down the road, if it’s term, how much longer is the term that we have that’s covering us? Do we need to think about future term policies? Things like that. So we want to know what you have first and then to understand what the purpose behind of it. Is. Annuities, is it a question that we always have, whether it’s an income generating annuity or is it a growth type of annuity? Is it a variable? And then outside of that, any types of other, what we would call non-qualified investments.
So typically that’s going to be a brokerage account. Think about money that you cash that you have already paid taxes on and you wanted to get it invested into something. Typically that’s a brokerage account or a stock account. That’s what we call non-qualified or non IRA non-retirement type of money. Once we have all those, then we start to talk about your actual retirement assets or your retirement plan types of investments. So that could be your IRAs, both pre-tax and Roth accounts. It’s important to distinguish the two of those. They’re taxed differently. So we want to understand those two types of accounts. If there’s a pension in place, whether that’s a cash balance pension, that pension that we haven’t triggered yet, or if you’re receiving a pension or you’re going to receive a pension in the future from a particular company, what’s that going to generate for you as an income source?
Any types of other retirement plans like 4 0 1 Ks, 4 0 3 Bs, four 50 sevens, TSPs, that whole alphabet and numbers of groupings of types of accounts out there. It’s important for us to understand the difference of what you have in 401k versus IRA. There are two different types of accounts and it does change the way that we are able to manage assets, and your age comes into factor here too. So we want to know the breakdown of those types of accounts and also in particular, let’s say in this case, she’s not 62 yet. She’s still working and she wants to retire at 62. How is she funding that account and what type of employer match are we getting because we have to grow the account for a little bit until she does retire. Any type of deferred comp plans that are out there, if you work for a government or a state, that’s where they’re most common is a deferred comp type of vehicle that forces you to start taking withdrawals at some point in the future.
And then any other stock options, restricted stock units, anything like that, they have different taxation to them as well. So we want to understand that bucket of money. What I’m getting at here is there’s a bunch of different types of investments and types of different retirement vehicles that we accumulate over the 30, 40, 50 years of working and earning and saving. And sometimes it becomes one big or it feels like it’s just unorganized, right? I’ve got an account at Fidelity, I’ve got an account at Vanguard, I’ve got accounts at Schwab, and we start to lose track. Well, our job is to help you bring it all back together to see it in one place, but also for us to start to decipher, well, how are these all going to work together to build out a really nice plan? That’s the investment assets. Then we also want to know anything about real estate, your primary house, any types of investment properties like rental or income generating properties, and we want to understand the liabilities on them as well.
So what are they worth, but also what do we owe on them and how is the debt being covered? Is it being covered by rents? Is it being covered out of our own cashflow? One, are those debts going to end? So mortgages being paid off, car loans paid off. We want to understand those liabilities. And then finally, and this is not exhaustive, but finally the other most important thing as we’re building out plans is understanding your income sources in retirement that you anticipate. So whether that’s you’re working part-time, maybe you’re consulting, maybe you do have rental income, and then social security. This person in this case is not 62 or social security eligible yet, but how we help them think it through and make that decision is we want to understand what their social security numbers are at 62 67, which is full retirement age right now, 70, which is the latest.
You can take social security. So we asked them to go to social security, the website and go get their report so that we can have the most accurate data as far as what they are projected to receive from Social security. I mentioned pensions, that’s another income source. We want to understand that as well. So all that to say it’s, I made it sound like it feels like a lot. It is a good exercise. It’s something that I think people should do annually to take inventory of what they have, how it’s grown, is it operating the way it should, but we want to see that so we can start understanding it as well with you and help you understand what you have and then help you build out that plan that hopefully is going to lead to a successful retirement.
Radon Stancil:
Alright, so now let’s transition over into another aspect of what we need to discuss as we’re getting ready for this potential retirement in 2026 is what are my expenses? Now, if you’ve read our book, which is called Security Retirement, we talk about three different types of income that we need to think about in retirement or getting ready for retirement. One is our essential needs. What is it? We need absolutely every single month that the bare minimum in order to make, I got to pay the bills, I got to pay the light bill, I got to pay. If I’ve got a mortgage, I got to pay the mortgage. And then what are our wants? What is it I would like to do that are not necessary, but I’d really like to do them? And then we’ve got what we got is what we call our legacy or giveaway money, meaning I want to give this money to the kids or to charity and so on.
The next phase of what we’re going to ask is, do you have a mortgage? If you have a mortgage, it’s very important that we have a breakdown between principal and interest payment and that of what we would pay for things like insurance and taxes, the insurance and taxes we have to inflate because that’s going to go up over time, but the principle and interest is not going to go up over time because, so we don’t need to put inflation on that. So we really want to understand that. And then we want to know what’s all the other essentials. Now, we don’t need line items. What most people do is they say, Hey, look, in addition to my mortgage, I got x, and X is I’m going to eat. I got to go to the grocery store, I’ve got to pay the essential bills. So whatever that is, let’s just say that’s three or $4,000 total, and you say, that’s what I want every single month just to live.
Well, now we want to go down the wants. Well, what are wants? Well, now you’re going to think about travel. How much do I want to travel in a year? What’s that budget going to or spending plan going to be? Do I have any memberships? Am I a membership of a golf resort or do I have other memberships to maybe some other place whether that be working out or whatever that might be. And then extra dinner and entertainment. So I love that we go out to eat once a week or we go out to eat twice a week, whatever that is, and then we add all that up and say, what are those? Then we go to that third category and we say, well, do I want to give gifts to charity or to the children so that we understand that category and then that’s going to give us our total spending.
Now, from our perspective, we do not need to know what your income tax is. We’re going to calculate that. We just want to know the net dollar of what you want to spend that now gives us the assets and what we want to spend, and then we’re going to have some questions we go through with you. An example, do we have anything big coming up? Do I have a car that I’m going to buy a remodel on the house? Those things like that. I also think it’s very important to know, do you have an estate plan in place, which for us, essentials are you need to have a will you need to have a power of attorney, a healthcare power of attorney, and HIPAA forms? Do you do your own taxes? Are there things that we need to think about from a tax planning perspective?
What are your goals that you want to have this non-monetary in retirement? Do you have something that you want to do, some hobby that you want to do that we can think through and help you strategize on what are your concerns around this whole idea of retirement? Because we want to address all those things so that we can build out a plan that’s going to help you feel good. Remember, this is a roadmap and it’s called the Peace of Mind roadmap. We want you to be able to have peace of mind throughout this whole process. Now, what we’re going to do is take all of this data that we’ve compiled and then we’re going to come back. When you come back, we are going to have for you your personalized, retirement focused financial plan. You’re going to have it all laid out for you, and we’re going to be able to do the what ifs.
And so what we’re going to do on our next episode is we’re going to fill out what we call our financial snapshot. We’re going to fill it out and we’re going to build a plan. We know this is a little bit fictitious, but we’re going to use what’s very common, what we run into today, and we’re going to walk you through Now in that particular episode, we will share our screen so that you can be able to see all those numbers and understand how it flows, but anything at all me on that that you want to add? Are we good on the setup here?
Murs Tariq:
Yeah, no, I think the setup’s good. The bottom line is a retirement plan at the end of the day is just really about the ins and the outs, the ins being what you have done to save, to prepare, and then what are we going to get as far as other income sources. The outs then is how are we going to spend the money and the solve that we’re looking for is does this work? And if we have this type of plan in place and then we monitor it regularly, like we try to annually with our clients, we can make manipulations and we can change it around and play around with it. But at the beginning, it’s very crucial to get the right data in place at the beginning.
Radon Stancil:
Yeah. Alright, well, we hope this has been at least a good foundation for us. We look forward to on our next episode, sharing all the results and letting you see how this could play out for someone, and maybe then if you decided that you would like to see your particular plan, you can do that.