“RETIREMENT 101” (6 LESSONS FROM DAD – FATHER’S DAY EDITION)

My parents are fortunate – after raising/providing for two boys in NY their post-retirement life includes traveling, pursuing new hobbies/interests, and spending time with family and friends. My parents were a team (more on that later) and my dad’s role on how he did it can be summarized in 6 simple lessons:

  • Invest for the Long-Term. Fast money is exciting – <sighs> I’m downplaying this – “Explosive growth feels amazing!” but it’s NOT anything what retirement planning should be based on. My dad, while working, focused on the long-view, never critical over annual performance; or whether he beat the index one year or another. Instead, he deliberately ignored the short-term noise and gradually became involved with his retirement portfolio… 30 years later. By then it was more of a hobby – enjoying the steady pace of the race. Mr. Tortoise knew what he was doing… the Hare never had a chance.
  • Stop Looking.  Expect your retirement investments to produce for the Big Picture rather than fixating on daily price fluctuations. So pretty please, with sugar on top, stop looking! (Yes, I’m also talking to you…Mom!) We’re all guilty of this – but as Warren Buffet writes: “Games are won by players who focus on the playing field — not by those whose eyes are glued to the scoreboard.” My dad enjoys his financial reads to stay informed without logging on for the ‘nth’ time. (Oh, but before I go further, you know I love you Mom!)
  • Have a Plan & STICK TO IT!  It takes a lot of saving to have enough money to retire- ahem, ahem. see my first post. When it comes to contributing to your retirement accounts consistency is what really counts. Avoid the temptation to not touch it along the way for loans or early distributions. My parents were a team with a system in place that worked for them – one salary dedicated to living expenses, the other, savings. My dad embraced his role and more importantly, stuck to it.  
  • Don’t Panic. Resist the urge to panic when the market turns the other direction. Black Monday (1987), Dot-com Bubble (2000-2002), and more recently, the Subprime Crisis of the late 2000’s – despite some of the worst financial periods (and there will be more, you can count on it) my dad’s investment temperament remained incredibly calm. Now the nerd in me wants to work asset allocation, efficient frontier theory, and/or Monte Carlo simulation into this but my dad’s approach was just as responsive: “remain cool, this too, will pass.”
  • Be Happy. The market goes  and  wait I’m sorry, it surges to record breaking highs until it plunges to levels where we could’a, should’a, or would’a, we have the media to thank for that! My dad always chooses to be happy, ALWAYS. Warren Buffett writes. “If you can enjoy Saturdays and Sundays without looking at stock prices, give it a try on weekdays.” Be happy with your plan, your investment allocation, your convictions and beliefs. My dad’s enthusiasm as an investor is not directly tied with what the bulls and bears say on CNBC. Be happy, if not “so happy!” Pharell had it right, except for that stupid mountain of a fedora.
  • Stay Healthy. This should be a no-brainer. What good is accumulating wealth if you aren’t going to be around long enough to enjoy it? Stay Healthy – you owe it to yourself! My dad exercises regularly, makes smart choices about nutrition, and keeps his daily activities (gardening, morning walks, and longevity stick  yes, longevity stick, look it up!) at reasonable levels in order to maximize his retirement years.

Today, an hour before his morning walks, my dad’s sitting outside the NE corner of our local Starbucks (SBUX). Though he enjoys using his Stock App on his I-Phone (AAPL) reading the ticker-feeds on Yahoo (YHOO  last one, I promise), he prefers to read his hard-copy WSJ just as he likes to pay his bills via US Mail. He roots for the Lakers, a loyal fan for over 30 years, yet proudly says: “Don’t you know, I’m a New Yorker!” as his go-to response to just about anything. Try it. Happy Father’s Day! Love you Pop!

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