3 Steps To Retirement Income Planning

Many people ask the same question: “how much money do I need to retire?” To answer this question you must answer two others first: The 1st question is; “how do I want to live?” because that will define your monthly income needs. The 2nd question is; “how much money do I need each month to live that way?” When you have answered these two questions everything else is easy. So lets focus on these two questions.

The smartest thing to do is compare your plan for the future with what you know best, your life and budget today. For planning purposes you can ignore inflation if your income streams are properly balanced to meet or exceed inflation. Yes, your costs will be higher in the future but so will your income so don’t worry about that. Do worry about taxes or you will be in peril of paying taxes on your Social Security pension. I will explain taxes in a later post. If you don’t follow this advice you will make it extraordinarily difficult to figure out a plan.

In order to handle “what if” scenarios it is best to setup a spreadsheet so that you can try different retirement ages or different debt scenarios. Doing this makes it relatively simple to apply tax rules also. It’s easier than you think and provides great information about the tax ramifications of decisions. Let the computer do the number crunching.

So the concept is to figure out the difference between your budget today and your budget when you retire, all in today’s dollars.

  1. Use your current budget to create your “future spending” budget. If you don’t have it on a spreadsheet then do that first. It will make things a lot easier later. Look at your current budget, line by line, and remove or change today’s budget numbers. E.g. If you intend to move will the real estate taxes be the same or less? Will you have a mortgage payment? How many cars will you be paying for, etc? Correct all those numbers for your future plan. Later on, when things look ugly, you can come back to these decisions and try different ones, the spreadsheet will help tremendously.

As an example, I will move house, travel somewhat, spend winters in the Caribbean, buy quality health insurance coverage and have the financial freedom for any hobby or recreation I may come up with later. It doesn’t take a rocket scientist to check rental costs in the Caribbean, medical costs, real estate costs etc, but you must answer this type of question and put a dollar figure on it. Add these numbers into your spending plan. If you mean to carry on as you do today then today’s spending budget will work. The only rule is to be honest about costs. Now, on paper at least, you have the life you wish for, all you have to do is pay for it. Go to step 2.

2. To complete this picture all you need is the monthly income picture. Since we can’t second-guess what the government will do, all we can do is use current information and build contingency into our plan. Use the social security pension projections, your private pension projection and apply the government rules on social security taxation in government publication 915, which you can get here. Don’t forget to add contingency into the overall budget and see how it looks. I will almost guarantee it looks ugly. This is the moment when you know you will be poor folks, that is, unless you planned for retirement. Go to step 3.

3. The gap between what you want and what you have must come from investments or other income streams. Lets say the gap is $1000 a month. Then your plan is short $12000 per year. According to my guiding principles this represents 4% of your savings, which means you need savings equal to $300k, and it must grow at a rate that meets or exceeds inflation plus the 4% drawdown. This is how you take care of inflation and why you do not need to figure it in to your plan today. Make sense?

In case you didn’t catch this, a very useful rule of thumb is that for every 300k of nest egg you can draw $1000 per month or some fraction of that. E.g. $150k gets $500/month, $450k gets $1500/month. See, you can do it in your head. Who needs a consultant?

So now you have a budget, a savings plan and a life. Now you are in control until the government changes something, so stay in touch with the news and adapt your plan. Keep your spreadsheet up to date.

My next two posts will be:

  1. The basic tax rules and how to protect your pension from Uncle Sam.
  2. What to do with that 300k, or whatever your nest egg happens to be.

So check back often.

Vacation Adventures With Your Grandchildren

One of the big pluses about being an empty nester is the arrival of grandchildren. However, grandparents today are more mobile and independent than ever and often live too far apart to see them regularly and are now planning vacations with their grandchildren .Some are seeking ways to connect and establish bonds with their grandchildren who live far away. Others are trying to find away to spend time with them that will build a lifetime of memories. Whatever the reason, it is growing in popularity and there are many well established companies offering a whole range of vacations . I am sure that you will be able to find one that suites you. Here are some that are worth checking out.
Grand Travel. The company offers travel vacations for grandparents and their grandchildren in Europe, Africa, and Australia. Guides are teachers who bring cultural experiences down to each child’s age level. Their trips depart primarily in the summer when grandparents and grandchildren can enjoy an extended visit with one another

Elderhostel Intergenerational tours. The largest educational travel company for travelers ages 55 and up, Elderhostel also offers grandparent/grandchild tours with more than 100 different domestic and international itineraries currently scheduled.

Sierra Club. The grassroots environmental organization Sierra Club runs dozens of adventure trips around the globe every year, but it also offers family outdoors trips in the U.S., including a handful of multigenerational and “Just for Grandparents and Grandkids” tours.

Disney -Deals on special packages from cruises to theme park vacations are available for grandparents traveling with their grandkids.

Thomson Family Adventures — Designs worldwide adventures for families, including African safaris, excursions to the Australian outback, and explorations in the Andes, China, Costa Rica and the Galapagos Islands.

Special Expeditions. Offers a selection of trips that include learning combined with scavenger hunts and educational puzzles for kids. Small company-owned ships go to remote island locations where all generations can study wildlife and nature.

Carnival Cruise Line. Ten “Fun Ships” offer a children’s program divided into four age categories. A trained staff oversees pool and playroom events and takes care of babysitting.

Get Your Colonoscopy

We all know that men over 50 need to get this done. We also know that most men will not. I am posting this in the hope that it will change some people’s minds and make them take action. Details will not be given so you have no excuse to stop reading.


At my annual physical three years ago my doctor recommended that I should get the procedure purely based on my age. My external reaction was “whatever you say doc”. My internal reaction was “no way doc”. This is the most feared procedure in Mandom and I am no exception to that rule. I kept it to myself so my wife wouldn’t hound me until I went. Long story short, over two years later I suddenly had a bout of courage and decided to get it out of the way.

The Procedure — I was unconscious


As I’m driving away from the hospital after the procedure my overriding thought was “why didn’t I do this sooner?” They put you to sleep so you are not aware of anything; there is no post procedure pain. Nothing! The only downside at all was the 24 hours before when you have to fast and take stuff basically to cause dysentery. If they could find a better way to do this you wouldn’t know anything had ever happened. The upside of course is the peace of mind it affords that comes with knowing where you stand. Oh, and the loss of fear for the next time, which is 5 years away.

Ok I was stupid in the first place, but now I know better. Don’t you be stupid.

Prince Charles. The Prince of Green

Charles is in the US to be presented with the Global Environmental Citizen Award, and will receive the award from last year’s recipient, former Vice President Al Gore. Anyone who cares about the environment should read on:

The Prince has been outspoken on environmental issues long before they became the popular cause of the day. As early as the 1970s he was trying to call attention to the problem of climate change and to promote sustainable agriculture. At that time he was thought of as eccentric and often laughed at. Even the English press, usually quick to comment, gave little copy to his work and views. In 1990 he made a BBC documentary called ”The Earth in Balance, A Personal View of the Environment,”. It was not received well and his prophesies on global warming fell mostly on deaf ears. Undaunted he took his beliefs one step further and started to organically farm his Gloucester estate.

“When I first started farming organically my real aim was to explore the best ways of developing a sustainable system of food production. Organic farming was, and still is, the most effective system of applying what I thought to be the principles of sustainable agriculture”

In 1992, the Prince created Duchy Originals, which has become one of the UK’s leading brands of organic food and drink. All of the profits from Duchy Originals are donated to The Prince of Wales’s Charitable Foundation. Today the popularity of organic foods has blossomed and Duchy Originals has become a flourishing business with sales revenues of $62 million. It has established its reputation by winning numerous fine-food awards.

The Prince plans to further his commitment to global warming by labeling his Duchy Originals range with details of the greenhouse gases emitted in making the products. He wanted to make consumers aware of the cost of their food in greenhouse gas terms as well as in terms of dollars and cents. Under the scheme, every stage will be analyzed to quantify how much climate-changing gas is released in producing each of the 200 items they produce. Some restaurants and food producers in England are already displaying “food miles” – the distance an item has traveled before being sold. But Charles wants Duchy Originals to go further.

images_duchyoriginals.jpgIt’s all too easy to be cynical and say it’s easy for him. But in truth, he could have chosen any number of causes that were more popular and easier to have been associated with. He stuck to his guns and committed his time and reputation by farming against conventional thinking . I’m sure that his life as a royal is often at odds with what he preaches but he is making changes; he now uses commercial airlines and biodiesel cars in an effort to reduce his carbon footprint and help fight global warming emissions. If his legacy is The Prince of Green, it is one that he would be proud of.

The P53 Gene – Life’s Achilles Heel

We live in an awesome time when science will unravel many mysteries of human affliction and suffering. To that end this is a great day! It’s called the P53 gene and is responsible for the control of cell growth. P53 shuts down cell division when it detects that DNA within a cell has become damaged, thus affording cells the opportunity to repair themselves before division can start back up. If the P53 gene itself is damaged then cell division will not be controlled and bad DNA is replicated. This is the Achilles Heel of life. This mechanism is responsible for more than 50% of known cancer cases, including all the major ones. The “Holy Grail” of cancer researchers is the total understanding of the mechanism and the repair of damaged P53 genes. Researchers have been wrestling with this problem for the past 25 years. For the first ten years it was thought to be an Oncogene. That was before its true nature was determined and it became the most studied gene in the human body. Over the past 15 years we have witnessed the human genome project; the unraveling of the truth about P53 and now the most exciting news: Researchers studying P53 have figured out how to turn it “back on” in mice. It was revealed this week that researchers from MIT and New York’s Cold Spring Harbor Laboratory may have just discovered the Holy Grail. In mice research they not only reactivated P53 but also have seen substantial evidence of tumor reversal in more than one cancer type. This is truly exciting since the only real solution to cancer must come from within.

Miriam’s Tag

Miriam at Ancestories has tagged me to post a “meme”; five things you don’t know about me. So here they are:

I was born and raised in England through the first 29 years of my life. I have been very fortunate in my life, experiencing life in two similar but different cultures.

I graduated with an honors degree in electronics and earned my living designing circuits both here and in the UK. It is exciting for me to know that my designs are still being used around the world.

I am a long time US citizen and proud of it!

I have been married to my childhood sweetheart now for 40 years and could not imagine life without her.

I have always been a big fan of soccer. I follow the US and English national teams in the world cup so I get two chances to win, although that is yet to pan out. It was an absolute rush to play indoor soccer with my sons when I was 55 years old. Yes it was tough but still a rush.

My wife and I are both active on our blog site. We do most things together and this is just one more thing. If only there were more hours in the day. Work seems to be getting in the way.

So there it is. I’m tagging some non genealogy bloggers because I like their “stuff”:






Pass it along. You are now tagged:

Senior Volunteering

Empty nesters have a unique opportunity to share a lifetime of experience and talents by volunteering. It offers not only a way to enrich their own lives but gives them the chance to use their expertise by working in their communities or for organizations throughout the United States and internationally. Many consider it the most rewarding thing they have ever done and can give new meaning to retirement. There are so many options that you are bound to find one that meets your needs and commitment level. Here are a few suggestions:

Senior Corp

The Senior Corp was conceived during John F. Kennedy’s presidency and enables seniors to contribute their knowledge, and experience to become mentors, coaches or companions to people in need. They also contribute job skills and expertise to community projects and organizations.

  • The Foster Grandparent Program connects volunteers age 60 and over with children and young people with exceptional needs. Volunteers mentor, support, and help some of the most vulnerable children in the United States.
  • The Senior Companion Program brings together volunteers age 60 and over with adults in their community who have difficulty with the simple tasks of day-to-day living. Companions help out on a personal level by assisting with shopping and light chores, interacting with doctors, or just making a friendly visit.
  • RSVP connects volunteers age 55 and over with service opportunities in their communities that match their skills and availability. From building houses to immunizing children, from enhancing the capacity of non-profit organizations to improving and protecting the environment, RSVP volunteers put their unique talents to work to make a difference.
  • RSVPI is the International leg of RSVP

USA Freedom Corp

One of the special initiatives of USA Freedom Corp is “Get Involved” It’s aimed at increasing the number of baby boomers involved in volunteering service across the country. It encourages participation and directs boomers to find volunteer opportunitie

Habitat for Humanity

Habitat invites people of all backgrounds, races and religions to build houses together in partnership with families in need. Through volunteer labor and donations of money and materials, Habitat builds and rehabilitates simple, decent houses with the help of the homeowner (partner) families. Habitat houses are sold to partner families at no profit, and are financed with affordable loans. The homeowners’ monthly mortgage payments are used to build still more Habitat houses.

Peace Corp

President John F. Kennedy established the Peace Corps in 1961 to promote world peace and friendship. Peace Corps Volunteers work in a wide variety of areas —and no two days are ever the same. Many older Volunteers find their age to be an asset while serving overseas. They have the opportunity to share a lifetime of work and wisdom with people of developing nations who respect and appreciate age. And because there’s no upper age limit to serve, it’s never too late—Volunteers who are well into their eighties have served and continue to serve.

Network for Good

Network for Good is a network that will find local organization with volunteer opportunities that match your interests and geographic location.

Failing Healthcare Systems

It’s interesting to compare doctors today versus their counterparts just 30 years ago. When I think of modern day doctors and dentists I can’t help but see Henry Ford’s influence applied to the medical profession; ”keep them lined up and keep them moving. Have workstations to do each task then move them to the next workstation.” It’s like herding cattle in its way. Head em up; move em out.

I’m not big on looking backwards except in Genealogy and loving memories of people who are no longer with us. I spent the first 30 years of my life in the British healthcare system. Home visits by doctors were normal. “Why bring a sick person into my waiting room” he would say. He had a point. But house calls take time. The English system is public healthcare and doctor’s income is not driven by how many people per hour he sees. It is not a production line system it is healthCARE. The downside of course is that it doesn’t have limitless income through taxation and there has been constant pressure to control spending (read: cut spending). The payment of medical bills through taxation means that the wealthy pay and the poor do not, everyone else being somewhere between those two extremes. Over the years services have been reduced to the point now that medical insurance top-up coverage is now fairly common. So the English system is evolving to look like our Medicare system. It seems we will all meet in the middle with some government coverage plus some private top-up insurance.

While the welfare state in England has been unraveling, US doctors have not been standing still. They have the medical production line down to an art. You go in the waiting room to wait; then your name is called and you go back into another room to…wait; eventually the doctor comes in and probably prescribes a pill. Gotta keep the production line moving. He goes from room to room to room as fast as possible. Turnover = profits. Boy, does that sound familiar. A new patient enters the waiting room at one end and a new prescription leaves at the other. Keep the line moving boys. Time is money!

So the modern medical insurance system is becoming very expensive for companies and individuals alike. More and more people are either subscribing to low-grade insurance (read: cheap) or they are just not insuring themselves. Hospital emergencies will always be taken care of whether you have coverage or not, but fewer and fewer people are indirectly picking up that bill through increasing premiums. More and more people being supported by less and less people. This is welfare in disguise. So, if this is the trend, it seems we are moving in the direction of a welfare state where fewer and fewer “haves” support the emergencies of the “have-nots”, which is where I started. How did that happen?

Children Of Men

This futuristic thriller adapted from PD James novel is a thought provoking, fascinating movie where Theo Faron , (Clive Owen), a former activist turned alcoholic, lives in a world full of chaos and no hope .It’s 2027 and London is a war torn city , grey and shabby with garbage visible on all of it’s streets. What ever ails the country it appears that it’s better than most places and illegal immigrants are flocking to the English shores. Here they are sought out and held in vast camps of internment by home land security as a preliminary before mass deportation. You feel the weight of depression on your shoulders as you follow Theo through his bleak working day and the grayness of his life. It’s a world on the edge of extinction where the women can no longer have children and its youngest child is 18 years old. Theo is abducted by a terrorist group called the Fishes and led by his former lover Julian (Julianne Moore) .She is idealistic and determined and persuades him to help in smuggling Kee out of the country. Kee holds a secret that she is willing to die for. Theo is at first an unwilling hero who is charged with getting her out of the country and he seeks the help of a friend when things go awry. michael-caine.jpgJasper (Michael Caine) the ageing hippy, ganja dealer hooks Theo and Kee up with a counter-cultural support network. Jaspers’ character provides some witty and poignant moments that are played beautifully by Caine. Theo and Kee are plunged into a terrifying chase which takes them through the squalor of fallen London to a nightmarish refugee camp when everyone is their enemy. Cuarà³n manages to create a London in the throws of urban battle that is uncompromising, and with the aid of brilliant cinematographer, allows you to ride along with the action instead of being a mere spectator It is an incredible scene and for a fleeting moment allows you to witness the resurrection of hope in the faces of the men and women when Kee’s secret is discovered. Cuarà³n has given us a truly original movie that leaves many questions unanswered. All the better. Visually it’s a great experience. Clive Owen and Claire-Hope Ashitey (Kee) both give solid performances and actor Chiwetel Ejiofor portrays Luke effectively. A good movie that more than makes up for a so-so script by giving a beautifully created vision of the future that is sure to evoke comment.
Rating: Four Stars


Well they say that 60 is the new 40. Last year baby boomers were galloping towards 60 at the rate of one every 19 seconds. Many people are turning back the clock of time by opting for plastic surgery procedures like facelifts, Botox, liposuction and hair implants. However, we all know that feeling young is much more than changing our outward appearance. To feel younger you have to feel and be healthy. The fountain of youth may be a myth but the latest research on aging suggests that humans have a maximum lifespan of 120 years. How can we capitalize on this? There are some irrefutable facts:

Good Genes, Good Choices
Genetics plays a part in longevity and most common diseases result from a combination of genetic and environmental factors. Genetic factors, inherited from our parents, make it more or less likely to develop a particular disease. However, our overall health is also a product of how we live and can be greatly influenced by the choices we make. Healthy living can reduce if not neutralize these genetic risk factors and add years to your life.

Eat Healthy
The best way to live longer and stay healthy is to eat healthy. Your body needs a variety of foods to stay healthy and to continue to perform well. Eat a balanced diet rich in fruits and vegetables This will pay back dividends. There is evidence showing that antioxidants can potentially delay the aging process, and protect against the development of age-related diseases. Antioxidants work by neutralizing highly reactive, destructive compounds called free radicals. Consuming more antioxidants, helps provide the body with the tools to neutralize harmful free radicals. Here are some good food sources of the four most commonly known antioxidants.

  • Vitamin C – the body cannot store this powerful antioxidant, so it is important to get some regularly — not a difficult task if you eat fruits and vegetables. Important sources include citrus fruits, green peppers, broccoli, green leafy vegetables, strawberries, raw cabbage and potatoes.
  • Vitamin E – A fat-soluble vitamin that can be stored with fat in the liver and other tissues, vitamin E is promoted for a range of purposes — from delaying aging to healing sunburn. Important sources include wheat germ, nuts, seeds, whole grains, green leafy vegetables, vegetable oil and fish-liver oil.
  • Beta-carotene – Beta-carotene protects dark green, yellow and orange vegetables and fruits from solar radiation damage. It is thought that it plays a similar role in the body and prevents cancer and heart disease and boosts immunity. Carrots, squash, broccoli, sweet potatoes, tomatoes, kale, collards, cantaloupe, peaches and apricots are particularly rich sources of beta-carotene.
  • Selenium – Is important in the protection of cell membranes. Selenium is also essential for normal functioning of the immune system and thyroid gland. It is best to get selenium through foods, as large doses of the supplement form can be toxic. Good food sources include fish, shellfish, red meat, grains, eggs, chicken and garlic

Limit the amount of saturated fats and sugars
A diet low in saturated fat and sugars lowers your risk for high blood pressure, diabetes, vascular disease, some cancers and obesity.
Keep portions small and limit calorie intake
This will help maintain an ideal body weight and guard against obesity. It is worth noting that low-calorie diets increased the lifespan of lab animals and are associated with long life in humans — so ideally, your calorie intake should be no more than what is needed to keep a healthy weight.

Regular exercise
Regular exercise will reduce the risk of most of the health problems we face, as we get older.

  1. Combining aerobic exercise with strength training will lower your risk of heart disease and diabetes as well as keep your bones and muscles strong
  2. It will speed up your metabolism.
  3. Exercise will also help you maintain a healthy weight.
  4. Regular exercise is one of the best ways to increase your HDL.

Research has found that a positive attitude may delay the ageing process. It is important to remain optimistic, stay happy and laugh a lot!