PODCAST EPISODE 140: Striving for Financial Freedom in Retirement

Below is a segment from a FedImpact webinar delivered on 12/16/2022 (the transcript begins at 01:12 of the audio recording).

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Striving for Financial Freedom in Retirement

Before I get into the nitty gritty details of the webinar today, I want to talk about the inspiration for today’s webinar. As we talked about and promoted this webinar on last month’s webinar, I mentioned that this idea really came to me out of a trip that my husband and I took. We were out in beautiful Sedona, Arizona. It happened to be there for a coaching program that I’m part of as an entrepreneur that we’re going to talk a little bit about.

This particular session was where couples came together. This room was full of 60 entrepreneurs and their spouses, and my husband made an interesting observation that really sparked today’s webinar. His observation was that nobody really talked about retirement there. Everyone’s focused on what’s next and what’s the bigger impact that can be made.

Keep in mind this is a group of entrepreneurs who are ambitious and they’ve got a lot that they want to see happen in the world, but he compared that to what it’s like for him talking to fellow federal employees. That everyone always seems so focused on “How much longer do you have?” like you’re in jail. “How much longer before you’re eligible?” And it was interesting enough for him to say that to me and it made me wonder, do we talk so much about retirement as the end instead of the beginning for the next phase?

As we were sitting in this session in Sedona, I was with my coaching program called Strategic Coach, I want to give them all the credit for this because they’re really an amazing group, but one of the things we focused on was what we call the four entrepreneurial freedoms. The freedom of time, the freedom of money, the freedom of relationship, and the freedom of purpose.

I don’t think that only entrepreneurs should have these things. Obviously there’s a different mindset for people running businesses and having some of those freedoms more naturally, but I think everyone should have the opportunity to have these freedoms, but it doesn’t happen by accident. It has to happen on purpose and being very intentional about what we’re doing.

Strategic Coach has been an amazing program to be part of. The mindsets that they bring to entrepreneurs really come out in a lot of the work that I do, and I’m so grateful for them and their message. But this really sunk in at the couples session for both me and my husband of the importance of these freedoms and how we can be more intentional about what we’re doing so that we can capture more of these freedoms, not just now, but in retirement, too, in that phase of life.

MINDSET

I want to talk really briefly about mindset. I have a little secret about retirement that might surprise some of you, especially those of you who have really been part of the fan club, so to speak, where you’ve gone to workshops, you listen to our webinars, you’re a podcast listener, and you hear me talk about retirement all the time. Here’s my little secret. I have a really hard time thinking about me retiring, and I know how ironic this is, and it makes me kind of giggle because I help people plan for retirement.

But when my husband asked me, “What does retirement look like for you,” I kind of froze. Because if you define retirement, and of course there’s lots of ways to look at this, but if at the core, retirement means being put out of use, I don’t know that I ever want to be in that position because I feel like you lose a lot of purpose and there’s a lot that we can do in this life and I want to be in it. In the fight, so to speak.

Maybe a different way for all of us to look at retirement and what I would encourage you to think about is that retirement isn’t the end, but rather what’s next. What’s the next phase look like? Instead of only looking at retirement as a finish line, what is it opening the door to be able to do?

One of the concepts with Strategic Coach is this idea that you want “freedom from” something. Maybe you don’t like your supervisor, you don’t like your job, you’ve just been doing it too long, you’re burned out, whatever. But you have to have the “freedom to” to feel fulfilled, the freedom to not go to work every day so that I can enjoy some of these other things that maybe I haven’t had time to do, for instance. We’re going to talk a little bit about that, but this idea that we just get to retirement and that’s the end, is really sad for me.

I, unfortunately, work with a lot of widows and we get to a point that sometimes we have to have really hard conversations with widows of people who retired and died days later after they retired. And that is a heartbreaking thought, but what are we doing to make sure that our future continues to be bigger than our past, that your federal service, or in my case, the work that I do as an entrepreneur, that’s not what defines me, but what am I working towards? What am I trying to get freedom to be able to do?

FINDING PURPOSE

I want to start with finding purpose. And I don’t want to get all psychobabble or anything on anybody, but what gives your life meaning? What is it that if you had the freedom to do, you would do on a regular basis? What’s that purpose look like?

Interestingly, all four of those words have seven letters in them– finding purpose after federal service. And I would encourage you as just a little bit of a hopefully fun exercise is if you were free from the shackles of employment (maybe you have to go into an office, maybe you’re stuck at home in telework, you have certain hours you have to be there, maybe you have a supervisor relationship that’s challenging, whatever that is), if you could free yourself of that, what purpose would your life serve after that point? And what needs to happen to be able to make that come true?

When we think about finding our purpose, we’re talking about things like nurturing relationships with your family and friends. A lot of people want to spend more time with their spouse, they want to travel, they want to be a part of their children and their grandchildren’s lives.

All of those things are so important. Others want to retire from federal service but then pursue other professional interests. You might have some follow on work that may or may not be related to what you did in federal service, but there’s maybe more that you have to give, professionally, that is fulfilling to you that comes after federal service.

Next, and I think this is the part of retirement that everyone thinks about, is just enjoying the fun stuff; the hobbies that you want to do that you find fulfilling, things like volunteering for causes that you care about. These are all great purpose-driven goals that people could have in retirement.

But if you’re not thinking about these things on a regular basis, you will involuntarily think of retirement as the finish line. When if you’re looking at all of these opportunities that are available to you after you leave federal service, it really frees up that “freedom to” idea. It’s not just the “freedom from” the job, but it’s the “freedom to” be able to pursue all of these things that you really want to be able to do.

SOME OBSERVATIONS

I have some observations that I think I have an obligation to share with you as we’re thinking about this concept. The first obligation is that some people retire too early. The grass isn’t always greener on the other side. And that’s not to say we want people to work forever, we don’t, because there’s a negative connotation to that, too.

But if we’re not financially prepared and we leave as a knee-jerk reaction to maybe a bad experience at work, or maybe you had a supervisor challenge or a coworker challenge or whatever it might be, if you retire too early, you might find yourself financially unprepared to live the retirement that you want.

On the flip side, there are plenty of people who retire too late and they work and work and work and work and they finally retire and they find that they’re not really up for traveling. They’re not really up for being very active in retirement. They’ve lost their sense of purpose. They think it’s just the end. That can be really dangerous, mentally and relationship wise, when you’ve kind of lost the future. It feels like it’s closer to the end.

Losing that purpose in retirement can happen whether you retire too early or too late. But if we’re not intentional about what we’re trying to get to and defining that purpose for us, then we can kind of be a little bit lost in retirement.

Here’s something that I want everyone to really hear clearly, and that is many people who are unhappy in retirement weren’t clear about what they wanted and what was required of them to have it. Because us wanting a certain lifestyle in retirement or a certain activity in retirement is great, but what is required of us, in our effort today, to put us in a situation where we have done what was required of us to be able to have it?

NUMBERS

That’s really the next section that we’ll talk about, which are numbers. What does financial freedom mean to you? It’s going to mean something a little different to everyone, but all along kind of the same concept here.

Some would say that financial freedom means that they get to live comfortably instead of just surviving. That they get to enjoy kind of day-to-day things without worrying about money. If they have children or grandchildren, they have the freedom to be able to help them, not just in times of peril, but in times of great opportunity.

Do you have a grandchild who’s starting a new business that could use some funding? Do you have a child who is pursuing a doctorate degree that might need a little financial help? There’s all sorts of great opportunities that our children and grandchildren can have that we can start, that we can help along the way financially.

If we have true financial freedom, we have the ability to do that. Financial freedom doesn’t mean you have all the money in the world, but that you have the ability to live out your life in a way that you find really fulfilling.

Others would say that financial freedom is being able to leave a legacy to your family (so this is after you’re gone) – and not just to your family, but your community as well. What do you leave behind after you’re gone? That might be (financially speaking), it might be impact. There’s lots of ways to leave a legacy, but if we’re thinking financially speaking, do you have a goal of what you’re leaving to your family?

We also don’t want you to be in a situation where you lived so frugally while you were in retirement, in the hopes that you leave this big legacy, but you didn’t enjoy the fruits of your labor or that you didn’t extend some opportunities to your family (helping bring families together for the holidays, going on vacation, whatever that might be), where you’re utilizing the financial freedom that you have to bring your family or your community together in a way that you can see while you’re still here.

Others would say that financial freedom is being able to generously support charities that you care about. That’s something that’s important to me. I enjoy being able to support causes and charities that are important to me. I would really hate to be in a financial situation that, kind of living the paycheck to paycheck thing, where you maybe don’t have the opportunity to support those types of charities that have meant something to you.

I would ask you, what do all of these things have in common? The answer is they all cost money. In some way, shape, or form, they all cost you something. If you want the freedom to be able to do these things or whatever might be on your list, we have to get the money right. None of this financial freedom is possible without knowing your numbers. And it’s really hard to live full-out if you don’t have a good money plan.

We can want all of these things, but if we haven’t done the work, if we haven’t done what’s required of us to get it, we won’t be able to have that type of satisfaction once we retire from our jobs. Whether that’s you and federal service or anybody out in the private sector, whatever that might look like, we have to get the money right.

TIMELINES

We’re often asked the question “When’s the best time to start planning?” And if you’ve attended our sessions, you know that this is a little bit of a double-edged sword. On one hand, the best time to start is a long time ago, but the next best time to start is now. If you want that shade tree that you see here on the screen, planting the seed today doesn’t really help you, you really needed to have done that 20 or 30 years ago to give time and opportunity to work in your favor.

But I would also offer it’s never too late, too early, or too often to plan. Don’t count yourself out of the race if you feel like you’re too behind. Everybody is further behind than they really wanted to be or what they maybe had the capability of doing. But if you put time on your side, that is always a good strategy. This is true if we’re talking about saving, investing, buying life insurance or buying long-term care insurance.

All these are just examples of financial tools that, if given time, can work in amazing ways. But if you wait until the very end when you’re about ready to retire, it doesn’t work that way. So please don’t wait until the time that you plan to step into retirement to start planning. Do that as early in the process as you possibly can.

Here’s something … The fact that you’re on this webinar tells me that you’re investing some time to be able to get your head right about retirement and maybe look at different strategies or get knowledgeable on benefits and everything, and that’s all great. But invest the time to get retirement right.

Most of you know we do retirement training for federal employees, so these are full day training sessions, and most agencies allow their employees to attend on the clock as part of their training, and so they’re not charged annual leave. But every once in a while we’ll have an employee email us and say, “Well, I wanted to go to this session, but my agency won’t give me the time off, so I have to cancel.”

It makes my head want to explode because this is your retirement. Is it not worth a day of leave if you really have to take it to get it right? Invest the time to get it right. Of all the things you spend time on, this phase of your life has to be a really important one.

Because if you don’t invest the time to get it right, all you can say in retirement is, “Well, crap, I didn’t get this right and now I’m paying for it.” You don’t want to be stuck like this poor cow. Invest the time to get this right and you will be very grateful later in life that you took the time to really invest in this process and, again, get it right.

CHANCE FAVORS THOSE IN MOTION

Let’s talk about some advantages. I am a big believer that chance favors those in motion. People who are idle, who aren’t engaged, they’re not making decisions, they’re not moving the needle – I don’t think the universe conspires to help you. It’s those people who are in motion, who are trying to do the right things, who are investing in their own planning, who are not afraid to make decisions and adjust as necessary. Being in motion is so important, especially when it comes to money. We can’t sit on the sidelines and pretend like it’s all just going to fall in place.

When I think about the advantages, I want to ask a couple of important questions. The first is, do you take responsibility for your own retirement? It is not the government’s responsibility to give you a great retirement. It’s not. It’s your responsibility to create the atmosphere that allows retirement to be all you had hoped for. But it takes your involvement, it takes your action. Do you take responsibility for your own retirement?

The next question is what can you be doing today to put yourself in a strong position to retire on your terms? Not because the government told you that you were eligible, not because some forum, some Facebook group that you’re on says you’ll be fine and that you should retire as soon as you’re eligible, or that you should work forever, whatever that might look like. What are you doing today to put yourself in a strong position to retire on your terms? To have the retirement that you personally want?

And this next bullet, I kind of mentioned this, who are you taking advice from? Are you so afraid to get advice from financial professionals who do this work for a living, that you turn to your peers or things like a Facebook group to get advice from people who don’t know you, who will never take the time to get to know you and your financial situation? But you think that it’s easier that way. And folks, these are hard questions to ask, and they’re probably hard questions to answer, but if you want a unique advantage over your peers, you have to be thinking this way.

The last question is one that we ask in our retirement workshops. Are you being honest with yourself about the reality of your financial situation? All progress starts by telling the truth. And if you are not honest with yourself about the financial situation that you are in today and the one that you have created for yourself in retirement, the chances of you actually getting the retirement that you hoped for are very slim.

This is just me being very upfront. I want to see you guys succeed. I want to get those messages from feds like, “I went to your workshop”, or “I went to some of your webinars and the advice that you gave about being active and being in the driver’s seat of my own retirement really benefited me. And I’m so grateful that I had that chance to learn before I finally retired.”

I love getting those messages. But oftentimes we get messages from people who never did the work. They never took the time to learn these things from qualified people. They never took advice from professionals that can assist in the goal that you have and then they wonder why retirement doesn’t feel good. They’re the cow on the fence, right? “Oh crap, I don’t have enough money. This wasn’t what I expected it to be.”

There have been a lot of lessons that I’ve had in my life. I’ve had time in the Marine Corps, I’ve worked for a financial planning company, I’ve obviously had ProFeds, and certainly on the personal side, layer that on top of the professional stuff. There’s been a lot of lessons that I’ve learned over my time on this earth. One of the lessons was from a POW.

WHAT A POW CAN TEACH US ABOUT BEING HONEST WITH OURSELVES

This gentleman’s name is Barry Bridger. Many of you may have heard of his story. He’s a Lieutenant Colonel in the Air Force. Barry was a pilot. He was forced to eject out of his plane over Vietnam. He was captured as a POW and held for 2,232 days at the Hanoi Hilton. Many of you have heard of John McCain. Barry Bridger was John McCain’s cellmate. And in case you’re curious of the math, that’s over six years as a POW.

When Barry was released, he continued and went on to retire from the Air Force, God love him, and when he retired from the Air Force, he worked for a financial planning company that served the military. I worked with Barry at Fort Leavenworth, Kansas, and there was a situation that I firsthand experienced with Barry that I want to share with you because I think it tells us a lot about what we can learn about being honest with ourselves when it comes to money.

Barry, like I said, was a financial advisor. He had a client and client family, husband and wife in his office, and the wife storms out of the office just after maybe 15 minutes being in with him.

She storms out of the office and I catch her and I’m like, “What’s going on? What happened?” She said, “I can’t believe what he just said to me.” And I said, “Well, what’d he say?” She said, “He just told my husband and I to pick which one of our kids isn’t going to college because we’re not going to make it. We’re not going to have the money to be able to afford it.” And I paused, and I looked at her dead in the eye and I said, “Is he right?” And she said, “Yeah, he’s right. But he didn’t have to say it that way.”

And while I can appreciate her perspective that no one wants to feel like they haven’t done the work necessary to get the end result that they wanted, in this case, it wasn’t about retirement, it was about funding their children’s education. But I shared with her, “Barry was a POW for six years. He lost six years of his life. He doesn’t have time to beat around the bush with people.

He wants to be really straight and candid with people, sometimes in a little bit of a gruff way, but he wants to be upfront and honest so that people know and they can take action. It does you no good for Barry to lie to you and shake his head up and down like, ‘Nope, looks like you’re doing fine.’ And then you get to a point that you’re trying to fund your kids’ college, and it turns out you don’t have enough money.”

When I shared this with her, I can see the guard kind of come down and she was like, “I know. I know. It’s not what I needed to hear today. And I thought we were in a better position.” And I’m like, “Listen, you have time. Your children are young. But what Barry is doing is trying to help you to realize and be honest with yourself about the reality of your financial situation so you can take action on it.”

I’ll never forget this lesson from Barry, although it wasn’t intended to give a lesson to me, it did based on the fact that I was involved in the situation, but it gave me so much respect for him that even though it was a little bit gruff, a little rough around the edges, it was the right message for that family.

They needed to hear that because without someone on the outside, who didn’t have a dog in the fight, being honest about what was the reality for that family if they did not change their course, that message rang loud and clear. Again, perhaps delivery could have been a little different, but he needed to strike them between the eyes so that they understood they needed to take action.

It’s such a powerful message. I’ve seen this man deliver a keynote message to the Command and Staff College out at Fort Leavenworth. He will bring a room of grown men to their knees in tears with his stories. It is impressive what he went through. But all that time that he spent, those six years as a POW, it changed his perspective.

He looked at the amount of time that he had been given in his life to be able to help people. He didn’t have time to beat around the bush. He just wanted to get right to it and help as many people as he could. I’m very grateful for that message from Barry and all the lives that he changed. Many of you may know Barry if you’re interested in military history and that type of thing. But really a powerful message.

I wanted to share that with you because sometimes we have to hear tough news. And what we do with that tough news will determine what the end result looks like– whether we use it as a reason to feel like a victim or we use it as a reason to really motivate ourselves to take action.

Wrap-up

Well, that’s it for today’s episode. I hope the rebroadcast of this webinar (in podcast form) has been helpful to you as you think about what lies ahead for you on our journey to retirement. Of course, I wish you all the best as you plan for this big transition in your life.  Stay tuned to the FedImpact Podcast to get straight answers and candid insights on your federal retirement. And of course, if you haven’t already, subscribe today, so you’re sure not to miss an episode.

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