What Will Your Retirement Be Like?

Will You Spend Retirement At The Beach?

I was having a conversation with one of the people I work with pretty regularly.  He is getting close to retirement so we discussed all kinds of interesting things.  He doesn’t have any children and has no desire to leave a “legacy” behind.  He is worth over a million dollars and has a healthy retirement account.

The conversation started off with his house.  He wants to sell it and buy a nicer place on the water somewhere with a very large down payment.  Because the market is down he thinks this is a good time to buy.  I couldn’t agree more.  Then he took a tangent I never expected.  He wants to take out a reverse mortgage where the payments he gets will cover the first mortgage until he dies.  Ideally he figures that when he dies he will have nothing in his home for equity.  The house will just go to the bank.

So I asked what happens if he needed the equity to buy into an assisted living facility or had some other major expense come up, or what if he outlived the reverse mortgage and had to start making payments again.  He didn’t have an answer.  He was more worried about getting to enjoy every penny, or to put it into his words, “be a mega consumer”. 

The problem I have with this logic is you never know when you are going to get to the last day.  I would rather find ways to live my life that make money instead of just spending it all the time.  I think when you only spend there will be some point where the funds get low and your stress level will rise.  Some people tell me I work way to hard, and in my mind I really don’t work at all. 

I get paid for doing many of the things I like to do like writing, teaching and flying.  For things I don’t get paid for, I can usually create a good writing project to sell.  Lucky for me most people hate to write and like to read.  I can’t imagine trying to just live as a consumer.

One of the tricks to building wealth so you have more control over what you do is to keep more of your money now so you can put it to work later.  Growing wealth requires that you keep as much as you can.  This means you need to know how to use the tax laws to your benefit in order to maximize the money you keep and control each year.

One of the smarter financial advisors I know of is Ken Fischer.  He wrote a book called Ten Roads to Riches.  It is a very good book, but the reality is unless you are a PHD, as in Parents Had Dough, there really are only two ways to get and stay rich.  Real Estate Investing and Business Ownership.  The government encourages you to do these things with the tax system.  The reason the government gives tax breaks to business owners and real estate investors is that these two groups actually increase the tax that the government gets even though on the surface they pay less.

Last year I met Dean Graziosi at a marketing seminar we were both attending in Scottsdale Arizona.  I purchased his books years ago along with another real estate infomercial “guru” named Carlton Sheets.  Both of these guys really did (and still do) make good money in Real Estate.  They just make a lot more as “information marketers”.  I watch them to learn how to market better for my clients.

Graziosi and Sheets both have systems that do work.  At one time my wife and I owned three rental homes.  Had we stuck to the program, they would be worth over $1 million dollars today and I would have them paid off with several thousand dollars a month income.  As Forest Gump said "Stupid is as stupid does." 

Instead I sold the houses and invested in a business I had no business being in.  In my mind I was a failure in that business, even though it was that experience that helped me regain focus and find my own road to riches.  I learned a lot from the experience and recently bought new versions of Deans Graziosi’s books as reference to buy real estate again.  One of the ten rules for success - Never Ever Give Up!

The other method of keeping more of your money is to own a business.  It can be as simple as joining an MLM like Send Out Cards or ACN.  The government wants to see you succeed in business so you can help grow the tax base for them.  Because of this they let you keep more of your money to build the business.  That is what I call a win-win.  It really is the basis of the American Capitalist system.

Ken Fisher talks about eight other ways to get rich in his book but the reality is that all of those people will either end up investing in real estate or owning a business.  For Instance, Shaquille O’Neill made a lot of money playing basketball.  Since then, he has become quite the business builder using the money from his basketball fame as capital to build his business.  Basketball stars might make a lot of money and look rich, but if they don’t invest right, they don’t stay that way.  Real Estate and Business ownership is a great way to get rich and stay rich.

If you aren’t ready to buy a house and rent it out or flip it for a profit and don’t want to invest a lot of money in a traditional brick and mortar business, then start with an MLM.  An MLM really is a business.  You have to learn all of the aspects of selling and hiring. Think about it, when you bring someone on board, aren’t you hiring someone that you are going to train for success.  Even though you aren’t paying for them you are investing in them. 

It helps if you believe in the MLM.  I joined Send Out Cards because I send a lot of “Thank you” cards to my customers, and sales postcards to potential clients.  Send Out Cards made it easy and it makes sense for many of my business clients.  No more going to the store to say “Thank you”.  I just log on, fill out the card, add a gift if it is appropriate and hit send. 

When I retire, many people won’t even notice because to them what I do is work.  To me, I am almost retired now because I am having so much fun doing what I do.  I can’t ever picture a life where I just spend and wait for it to end.  There is something out there for everyone, you just need to go out and do it. Skip a little TV time and start building your own fun road to riches!