Get Your Retirement Back on Track

Get Your Retirement Back on Track

Veteran financial journalist Mark Miller’s new book, Retirement Reboot: Commonsense Financial Strategies for Getting Back on Track, serves as a guide for the millions of Americans who aren’t financially prepared for retirement. He offers insight on how to make the most of remaining working years and explains core decisions that can improve a person’s retirement outcomes -- even if retirement is just a few years away.

In our Q&A below, Mark discusses the problem of complexity in the U.S. retirement system, what can be done to improve retirement outcomes, and recommendations for people who are already retired.

Q: You write in Retirement Reboot that complexity is the enemy when it comes to building toward a financially secure retirement. Why?

A: The United States has built a set of systems for retirement that calls for expertise and knowledge beyond what is reasonable to expect from the average person.

The complexity of these systems makes it harder for individuals to make fundamental personal decisions about their own retirement planning - everything from saving and investing to figuring out the right time to retire and claim Social Security. Transitioning from employer health insurance to Medicare can be a challenge. And there’s the challenge of protecting yourself from the risk of a long-term care need. The list just goes on and on.

Q: What is one of the simplest things people can do to stretch retirement savings?

A: This really is an example of the complexity I’m describing. Retirement researchers have debated endlessly what constitutes a “safe” withdrawal rate from retirement accounts. Morningstar’s latest research pinpoints 3.8 percent as a safe starting rate for retirees seeking a fixed real withdrawal over a 30-year time horizon. But to me, this question illustrates the complexity we were just discussing. We’ve made a shift away from defined benefit pensions, which provide a guaranteed lifetime income source, to tax-deferred retirement savings solutions, like 401(k) accounts. Drawdown strategy involves some guesswork. Tell me how long you’ll live, and I’ll tell you how to stretch your savings across your entire retirement!

Q: What are some of your top recommendations for those already in retirement?

A: Far more retirees could benefit from the help of a financial planner - if they hire the right kind. Financial decision-making is more complex in retirement than it is during your working years when the main goal is to save. What you want is a fee-only Registered Investment Advisor who represents you as a fiduciary in all situations. I have a chapter in the book that explains the best way to hire a planner.

Beyond that, I think it’s very important to have a sense of purpose in retirement. Whether you work as a volunteer or part-time for pay, using some of your time in retirement this way pays big dividends for your own health and mental well-being. Researchers have found that about one-third of older adults are pursuing goals of purpose and that the activities span all educational backgrounds, socioeconomic circumstances, genders, and regions. They also find that purposeful living doesn’t crowd out more self-oriented leisure pursuits—just the opposite, in fact. People who pursue purposeful activities in retirement are more likely to also pursue learning and leisure opportunities than those who don’t live with purpose.

Want to learn more? Visit Mark Miller’s website Retirement Revised:

Mark Miller is a popular columnist who writes about the personal finances of aging and retirement issues for the New York Times, Reuters, and Morningstar.

Before making any major financial decision, always check with your personal financial advisor.