He Tried Christmas – Don’t Let the Grinch Steal Retirement

He was a mean one, that Mr. Grinch. He hated Christmas. The happier the Whos, the angrier he became until he couldn’t take it anymore. He hatched a plan to steal Christmas. Disguised as Santa and his dog Max as a reindeer, they sleighed into Whoville. House by house, they stole all their presents, trees and decorations, and left only crumbs too small for a mouse.


But he didn’t stop there! He also dished out bad retirement advice. He didn’t think of anyone but himself, he lived alone in his cave, and gave no thought to his future.

“He was a selfish and bitter grouch, and a tax cheating slouch.

And if you asked him for financial advice, why would he care? He’d steal Cindy Lou Who’s last candy cane. You better beware.”

He’d pooh-pooh the Whos. Let’s warn them about three Grinch retirement recommendations that can be rotten or should be forgotten so they are not later crying boohoo.

“Billie Who is 66 and wants his investments to grow and last the ages.

But his golf buddy Henry Who says look at this retirement book. It says people with graying hair should play it safe. Here read the pages.”

Don’t get pigeonholed or typecast with investment strategies. People have unique situations, needs and goals. Two households may require different investment approaches despite being similar in age. Yes, there are general rules but focus on what is best for you. For example, a common starting point in allocating between stocks and bonds is subtracting your age from 100 and that’s the percentage you hold in stocks. A 30-year-old would have 70 percent in stocks and 30 percent in bonds. A 70-year-old would have the opposite. In general, the portfolio would become more conservative with age.

But take Billie Who and Henry Who – their age is the only similarity. The bulk of Henry’s living costs are covered by pension and Social Security, and he has a modest amount saved. Billie has Social Security, no pension and a substantial 401(k) balance to fund the bulk of his lifestyle. Henry has the option of going “safe” with his investments or can be more growth-oriented. His savings can either supplement income or pass to heirs. Billie needs his investments to work hard to beat inflation and pay income taxes.

Another example, is how two elderly women might answer “What’s important to you about money?”

One says, “I don’t have time to earn it again, so I want it safely invested.” The other says, “We worked hard for this money and we want it working relatively hard for us and our heirs.”

Drop the stereotypes of age, and instead, focus on purpose.

“Donna Who says we’re staying put. The home is old and big. But it’s paid for.

Her girlfriend Susie Who says our home situation is similar. But we’re looking for something simpler. While we are able, we’re ready to explore.”

It may be hard to pry the Grinch from his dark cave. However, Baby Boomers and the Silent Generation are active residential buyers per a National Association of Realtors survey on home buyer and seller generational trends. Those generations comprise about 38 percent of homes purchased and the top three reasons for buying include the desire to be closer to family and friends, smaller home and retirement. Some found themselves house rich and cash poor. A house is one of, if not, the largest asset people own, and equity is idle unless sold or borrowed (including reverse mortgages). Others resize their home – downsize or upsize – for quality of life issues.

“An estate plan? I say every Grinch for himself. Why worry?

But Whoville is a community of families. The Guy Whos think what if something happens to me? Will the She Whos stay single or will they remarry?”

Thinking about end of life and preparing for it can be two different things. A Caring.com survey referenced in an article in AARP.com. It found that only four in 10 Americans had an estate plan. Estate planning becomes a higher priority with age with 58 percent of Boomers and 81 percent of those age 72 and above. However, estate planning is not one and done. It needs to be updated to reflect changing situations and life dynamics.

There are at least four reasons the Whos should visit with their estate planners and refresh. They include understanding the estate plan, updating beneficiaries, funding the trusts and titling newly acquired assets properly, and reviewing the designated players – including agents, executors and trustees. They are aging and changing like us.

The Grinch story ends well. It’s about his redemption.

“He brought back the toys! And the food and the feast!

And he… he himself…

The Grinch carved the roast beast!”

Merry Christmas and Happy Holidays to you and your family.

You can also view this article on the Reno Gazette Journal.

About Brian Loy

Brian Loy writes insightful and inspiring articles about the ever-changing world of personal finance and the global trends that affect the risk and return on investments and shape the financial- and retirement-planning process.
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