Episode 896 Invest in Yourself - Interview with Roger Whitney the Retirement Answer Man – Part 1
[00:00:00] Scott Maderer: [00:00:00] Thanks for joining us on episode 896 of the inspired stewardship podcast.
[00:00:08] Roger Whitney: [00:00:08] Hey, I'm Roger Whitney. I challenge you to invest in yourself, invest in others, develop your influence and impact the world by using your time, your talent and your treasures to live out your calling, having the ability to work for your future.
[00:00:23] As a key, having the ability to work for one more. Having the ability of pause second, having the ability to work for your future is key. And one way to be inspired to do that is to listen to this, the inspired stewardship podcast with my friend, Scott Maderer.
[00:00:46] what I hear from current retirees or people that are on the cusp of it. And they're telling me why they want it. It's they don't want to not work. They want to have more control over their time [00:01:00] and they want to have some time freedom to pursue other things as well.
[00:01:06] Scott Maderer: [00:01:06] Welcome and thank you for joining us on the inspired stewardship podcast.
[00:01:11] If you truly desire to become the person who God wants you to be, then you must learn to use your time, your talent and your treasures for your true calling in the inspired stewardship podcast. We'll learn to invest in yourself, invest in others and develop your influence so that you can impact.
[00:01:32]in today's interview with Roger Whitney. I ask Roger, what's wrong with thinking about retirement as a magic number. I asked Roger to share why waiting to live till retirement happens may not be the right thing to do. And Roger and I also talk with you about how balancing your lifestyle can let you have a life both before and during retirement.
[00:01:56] One reason I like to bring you great interviews. Like the one you're going to [00:02:00] hear today is because of the power in learning from others. Another great way to learn from others is through reading books. But if you're like most people today, you find it hard to find the time to sit down and read. And that's why today's podcast is brought to you by audible.
[00:02:17] Go to inspired stewardship.com/audible to sign up and you can get a 30 day free trial. There's over 180,000 titles to choose from. And instead of reading, you can listen your way to learn from some of the greatest minds out there. That's inspired stewardship.com/audible to get your free trial and listen to great books the same way you're listening to this podcast.
[00:02:45] Anyone who thinks retirement planning is boring. Clearly hasn't had a conversation with the retirement answer, man, and is not so alter ego. Roger Whitney, his fun, fresh perspective on money in life turns financial planning [00:03:00] from something people need to do to something they can't wait to do. Roger breaks with traditional financial planning in asserting that there is no quote magic number or accurate retirement calculator.
[00:03:13] There is just. And your financial planner, having the right conversations, finding confident answers to meaningful questions and setting your priorities according to how you want to live and keep living your life long after you stop working. Welcome to the show. Roger
[00:03:31] Roger Whitney: [00:03:31] Scott, everybody. It's great to be
[00:03:33] Scott Maderer: [00:03:33] here.
[00:03:34] Thank you so much. So Roger and I, we go way back. We run into each other at various events over the years and so you've been on my list of somebody I want to have on the show for a while. And part of it is because I've had conversations with you, your real person or your alter ego, whichever way you want to say it as the retirement answer, man, and we've had those conversations about retirement and what's wrong with the way we look at it [00:04:00] today.
[00:04:00] And how is it different? For different people and all of these sorts of things. And you've got a lot of great insights that I think is valuable to folks. So I think, you've even seen the commercials. A lot of people come out and it's retirement. What's my number. I need X number of dollars and then it's magical and I'll be able to retire and live in Tahiti and sit my ties all summer.
[00:04:21] What's wrong when it comes to that kind of thinking about
[00:04:24] Roger Whitney: [00:04:24] retirement in terms of what's my number. Yeah. How much do I need? I think the attraction to it is that it's elegant. It's simple, right? It's a math problem and math problems, I wasn't great at math. I'm not the math in, in high school, but math is a very confined, structured way of addressing something it's tidy.
[00:04:54] And so it lends itself to. Financial planning and financial people [00:05:00] who created the process for financial planning and retirement. It didn't come from a life coaching perspective. It came from financial nerd perspective. And as far as how financial planning is done, like a spreadsheet, right? Yeah, you're right.
[00:05:15]In our rock retirement club, we have a whole group called the spreadsheet geeks, right? People love spreadsheets. They're clean and. Even if you're not a spreadsheet geek, there's this attraction to having a number, a specific goal, the problem with a number and the reason I think it's a horrible way to approach it is it can literally cost you your life.
[00:05:42] Meaning that. I can easily do a number by doing a net present value of the spending. You're going to have over 30 years in retirement factory in an inflation and blah, blah, blah, and get to a number that you need to hit, but [00:06:00] to make it so concise, what you end up doing is. Sacrificing potential spending because to make the number work, you have to be somewhat conservative.
[00:06:13] So what happens if you hit a number you're likely going to underspend and end up with too much money towards the end, just because of the way the system is built and just more practically life is messy. Life doesn't happen in a spreadsheet and thinking that it does ignores how multi-dimensional life is.
[00:06:39] We have different seasons of things. When we want to do things you think back to, college and right after college, when ramen noodles was perfectly acceptable and we were really focused on experiences. And then you think of another season of life. In, raising children and all the expenses and, it's a very expensive season of life while [00:07:00] retirement has its own seasons, right?
[00:07:02] It has go-go years and slow-go years and no-go years, which are easily accounted for in a spreadsheet. So I think it's just, I think it's a good starting point, but it's so much more nuanced than that.
[00:07:18] Scott Maderer: [00:07:18] And so it's not, it's not advocating well, ignore them. But it's advocating think of it as more than the numbers.
[00:07:26] Roger Whitney: [00:07:26] Yeah. It's the, it's a first step in a lot of different things that most financial planners and most people aren't trained in as well. And in an area of things that are a little bit messier. What do I want is a hard question to answer.
[00:07:47]Scott Maderer: [00:07:47] And I'll, so I'll take it in another realm.
[00:07:49]One of the things you'll see online go to paying off debt, which is, Flip it around and look at it the other direction and you can find 1,000,001 debt, payoff, calculators, that'll put it [00:08:00] in and use the snowball or the avalanche or the, whatever other names they have.
[00:08:05]There's various ways of paying up and this is the date you'll be debt free. And what I always tell people is what I can pretty much guarantee you with. Any of those calculators is whatever date it tells you. It won't be that day. It'll be some other day because statistically. It's usually going to happen either sooner than that, or later than that, and there's only one way it works out in is exactly that day. There's millions of ways that works out. And it's some other dates, either better or worse, not necessarily worse, not necessarily better. Depends on a lot of what happens in your life and what do you do and mindset and all these messy things that you're talking about.
[00:08:40] It's similar to the same idea, but, flipping it around and looking at it the other way.
[00:08:45] Roger Whitney: [00:08:45] Yeah. And it also doesn't answer. The core question as to then what cause if you think of paying off debt as an example, but
[00:08:56] Scott Maderer: [00:08:56] it's not an end result,
[00:08:58] Roger Whitney: [00:08:58] but he also think of it. [00:09:00] There's different levels of thinking first level thinking is I want to pay off this debt, all this debt.
[00:09:05]But really, if you go deeper than that, the real reason is about paying off the debt. It's about. Self-confidence it's about comfort. It's about being proud duty to your family, all those types of things. And that's where the magic is and most cases. Yeah. And that's
[00:09:23] Scott Maderer: [00:09:23] yeah, we actually talk about that, that hanging off that as simply a goal or a check box on a list.
[00:09:28] Who cares, pay it off. Don't pay it off. Who cares, but why do you want to pay it off as the deeper reason? What's the real driving reason. And thinking about that, you talk a little bit too about how people can focus so much on having a good future that they give up. And we were just talking about it a little bit, give up some of their life today, perhaps in a way that isn't necessarily.
[00:09:55] Healthy, you were talking about the person that overcompensates in one direction [00:10:00] and you talk about living like you're already retired, which I have always thought as an interesting turn of phrase. Can you unpack that a little bit and talk about what that means to you?
[00:10:09] Roger Whitney: [00:10:09] Yeah. And a lot of this comes from the math approach, right?
[00:10:13] Whether it's my number or the 4% rule, which is another number that goes along with the first
[00:10:20] Right now, traditional retirement planning is structured to offer really bad solutions, meaning that when you're thinking about retirement or building for the future, what ended up happening over the last 30 years as retirement is morphed into some weird thing that can't be solved as easily, right?
[00:10:44] Because the modern retiree, and even those retired today, they're living longer than any generation. They typically don't have pensions. Not only are they living longer, I may not feel this way, but they're healthier and more active than they [00:11:00] ever been have ever been. Especially early in retirement. And they're more interested in being in the playground of life than being on the park bench, and so that has changed the dynamics of retirement planning to where traditional retirement planning, if somebody is 30, 40, or 50, and they're going to a financial planner. What ends up happening is the math doesn't work near as well. Because of these factors of more spending longer timelines. So the solutions consistently come back and I know this I'm a CFP, I'm a financial planner.
[00:11:35] I've taught the CFP curriculum and doing this a long time. The math comes back with, from financial planning of, okay, you're going to have to save more money now. To fill the gap to that number, right? Or you're going to have to work longer, or you're going to have to spend less in retirement or likely it's going to be a [00:12:00] combination of all those things.
[00:12:02] Save more, work longer, spend less in retirement. All of those solutions suck. So no wonder it's hard to engage in retirement planning. Because the number gets to be so intimidating and those that are really stewards and wired to want to fill the gap will end up executing a lot of those solutions. And that's where you have both parents working, you got latchkey children, you forego the vacations with kids or with your spouse earlier in life.
[00:12:42] And you miss those moments. Creating shared experiences and bonding to get to the end. So you can live the brochure pitchers when you retire. And so it ends up becoming this exercise of, I [00:13:00] have this huge, we have this huge mountain to climb, to get to the summit where it's going to be beautiful and that will be retirement.
[00:13:08] And it ends up becoming this intimidating thing that we felt like we had to sacrifice. That's a horrible way to live. Because, yes, we need to be good stewards for the longterm, but tomorrow is promised to no one. And I always in the book, my book, rock retirement, I used the story of my mother who sacrificed most of her life, being a single mother and then getting remarried and becoming a lawyer when I was in middle high, middle school, high school.
[00:13:36] And we would always have these discussions. I being a latchkey kid and her slowing down, and she had this dream of talking about having her life in the future. And then she died at 48. And so I think rather than I think of retirement as this goal or this destination, [00:14:00] like a hike up Mount Everest, I think it's more helpful to have more balance and think of it as a.
[00:14:06] A Trek that is more consistent. So you're enjoying life every step of the way.
[00:14:12] Scott Maderer: [00:14:12] And so what does that actually look like for someone, when you think about balancing today in the future, what are some practical ways or mental ways? However, it works that people, because it is intimidating, cause you don't, we don't know the future and we don't know how long it's going to be.
[00:14:28] And it is. Because you've the opposite extreme, is Yolo. You only live once and they live in the moment. They'll do anything for the future. So how do you
[00:14:37] Roger Whitney: [00:14:37] balance that? Close your eyes. Th the key there, your question is how do you balance that? Because if you close your eyes and if you can imagine you're straddling a teeter-totter, you're standing on the teeter-totter and you're trying to keep both ends of it.
[00:14:53] Even. That's what we're trying to do here. On one end, just having a great life later in life. You want to be a good steward. And then the [00:15:00] other end of the teeter-totter is having a great life today and we're trying to balance those things. And if you've ever done that as a child, I don't know if they're even still there.
[00:15:09]You're never imperfect ballots, right? You sort to get a little too far one way, and then you correct. And you go back the other way and it's always a little juggling. I think the first step is to realize that it's a juggling game. So practically, what do you do? I think one of the healthier things to do is to rethink what retirement actually is, right?
[00:15:34] Historically retirement isn't even really a word for humans. In the last hundred years, it wasn't a word. People worked. Long time until they couldn't work. So it's a more modern concept, especially in, in, in the United States. So that's one, and I'll tell you my perspective. So I work with clients that are right there in retirement and through our podcast, [00:16:00] talk to thousands of them.
[00:16:03] What I hear is retirement. Isn't about the absence of war. Just how we think about it, getting the gold watch and you're done. That's not what modern retirement is, what retirement is. And I don't think we have to come up with a new word for it. I think we just use the word and repurpose it.
[00:16:24] What I hear from current retirees or people that are on the cusp of it. And they're telling me why they want it. It's they don't want to not work. They want to have more control over their time. And they want to have some time freedom to pursue other things as well. So I think one healthy thing that you can do doesn't matter what age you are is rather than think of it as a light switch where you're working or you're off.
[00:16:54] Thank you for that. Like a dimmer switch, which means. [00:17:00] Strategically and professionally, you can start to think of how do I gain more time freedom in my life early on. You may not have a lot if you're in your twenties and thirties and you're working a corporate job, or you're building a business, you're going to work a lot because you're building the foundation of who you are.
[00:17:15] But what you can do is start to invest in things that will help you have options. Working, remotely, which COVID has actually been a big blessing in that sense. Anyway.
[00:17:28] Scott Maderer: [00:17:28] It's for some companies that said, we'll never let anyone work remotely go maybe we'll figure this out.
[00:17:32]Roger Whitney: [00:17:32] And having your own job, or maybe pivoting to work that isn't nearly the hustle that you're on right now.
[00:17:41] So I think it's, so that's one easy way to reframe and practically start to think strategic.
[00:17:46]Scott Maderer: [00:17:46] And thinking about that, whether it's you're in an early phase or even later, because I think the other thing too is on phases. It's not always just age dependent either. So using me as an example, I was a school teacher and then I went into [00:18:00] the corporate world.
[00:18:00] I got into senior management, was a highly compensated employee. And, did all of that sort of thing. And then said, I'm tired of working 80 hours a week, I'm paid well, but I don't want to keep working 80 hours a week and flying all over the country and doing all of those things started my own business on the side, which now man, I was working, 110 hours a week.
[00:18:20] Cause I was starting my thing on the side and then slowly stepped out of the senior job. Stepdad then went to part-time and then left and launched my own business. And again, when I was in that relaunch phase of really launching it as a full-time thing, I still worked 80 hours a week, but now that I'm two or three years into it, I work 80 hours a week anymore.
[00:18:40]I designed it in a way that I've got more time, freedom, I'm taking off tomorrow afternoon to go do some running around with my son. I get to do that.
[00:18:47] Roger Whitney: [00:18:47] Another example in the corporate world have a really good friend and colleague. But I've known for decades is he invested so much in his competency [00:19:00] and not as efficiency, but his effectiveness in what he is craft as well as invested in his professional network, that his plan and what the plan that he executed was every four or five years, he quit his job.
[00:19:18] And took a year or so sabbatical. And he, his children are high school, just graduated college now, but he did it strategically. So he could have a year being dad and husband and explore on a personal level with his children at different stages. And then he would go back to work. What set him up to do that was that he was.
[00:19:44] Had a reputation and was very effective in his position. And he had a very vibrant professional network that he had nurtured for years. So he never wanted or felt a scarcity of the opportunity.
[00:19:57]Scott Maderer: [00:19:57] He could turn it back on when he wanted to and people would talk to him [00:20:00] again, it wasn't,
[00:20:01] Roger Whitney: [00:20:01] and he would keep it fresh.
[00:20:02] But so I think there are a lot of different ways. I know what one thing I do find is. People like to compare themselves to others, how I met, how am I doing relative to others, my age? And that's a natural thing. And that kind of benchmarking, is important to a point. And it's the natural inclination to do.
[00:20:24] And I do it as well in my business and in my life. I'm a 54 year old dude and he's married and two adult kids. I do it. I have to remind myself constantly that I play by my own rules and I get to set and structure my life any way I want. Now I didn't always have that freedom. I don't have that freedom as if it's a blank slate.
[00:20:50] I have obligations that I can't not do, but I can still create those rules for myself. [00:21:00] And the natural flow of the current of adulting and especially in the professional world in corporations and such is your projects hitting the projects, your performance reviews, the corporate ladder mentality of always trying to move up and that natural current can easily pull us away from what's really important to us.
[00:21:26] Right.
[00:21:28] Scott Maderer: [00:21:28] So when things, when thank you about that, looking at your own career, or whether it's a small business that you run and thinking about the skills that you develop how does that, focus on career and skills and that, that mindset, how can we look at those in a way that helps impact both?
[00:21:44] Again, getting back to that balance idea, having a good life today while still having a good life.
[00:21:49]Roger Whitney: [00:21:49] I think the way that it becomes integrated with that concept is in order to [00:22:00] execute on, do I invest in my career? Do I invest in my relationships so forth? All of those things ultimately give you. What we all crave and that, and usually we're very fearful when we don't have it. And that's agency, people are happy when they have, in my experience.
[00:22:23] Anyway, I'm not going to say, I know people are happy when they have some sense of agency in their life and they are. Always moving a little bit forward to the next version of themselves. So I think you have to integrate those things. And the financial planning has the opportunity. And if done well, can help people navigate that to think through what's their next version of themselves, because that's really what we're already becoming.
[00:22:52]As an example, if you are very pre quote unquote retirement, and you have a long [00:23:00] professional career, Rather than, let's say you're in your twenties or thirties, maybe even early forties, rather than think about retirement. And what's your number. And these things that we've been talking about it really is just, how do I build my wealth of resources?
[00:23:18] So wealth of resources is a balance sheet, right? Your net worth statement, your 401k and your IRAs and your cash reserves in your home, et cetera. But you're. Resources are also your relationships, your skills, what you bring to the marketplace, because if you have a long career of creating and an advocation, or excuse me, a vocation, then investing in your skills and your reputation and your network are maybe the best places to invest.
[00:23:54] And so you start to integrate those things. And rather than think really [00:24:00] far off to retirement, you can think of where do I want to be two to five years from now three to five years from now. That's how I think in my business, where am I going? Where, what version of myself do I want to see in the next three years?
[00:24:15]That's different than today. Those are the gaps that are much more manageable to fill. And they're also much more. Realistic to accomplish. So if you think of, it is the old phrase, the, the journey to your, I forget, I would say it's a. It's a Chinese phrase of, your journey begins with one step, that's the end of it.
[00:24:39] I forget
[00:24:40] Scott Maderer: [00:24:40] a thousand steps begins with one. Yeah. Something like that. Yeah. The
[00:24:43] Roger Whitney: [00:24:43] version of that. Yeah. And the reason why for us in our practice and on the podcast, we talk about our agile methodology because it's iterative, rather than you have an idea of what you'd like to your future self. Long-term project to [00:25:00] look like, but really everything comes down to the next iteration that next step.
[00:25:06] And if we can focus on that next step all the time. We're going to have a lot more agency and we're going to get, start to get excited about it because it's not so intimidating. And it also
[00:25:15]Scott Maderer: [00:25:15] Has a bias towards action that way too, because you can't iterate on an idea. You can only iterate on something that's put into action at some low level.
[00:25:25]You have to begin moving to steer the ship, so to speak.
[00:25:30] Roger Whitney: [00:25:30] So the acronym I like to use Scott I call it wham. Really. Everybody wants the way. And not the band. And although they have some great songs. So the wham is the question you always need to be asking yourself, what do I do next?
[00:25:49] What is the next step? What opportunities should I focus on? And or what risks should I focus? And that's a harder question than you think, because we're in a very [00:26:00] busy world where we're distracted by all this bling. That's really not important in the scheme of things, we've got to figure out what is the lever I need to focus on.
[00:26:08] So that's the w once you identify that, then it's okay. How do I do that? How do I solve that issue? What's the framework to figure that thing out and take action. So the, how there's the, yes. And then the a is going to be some accountability and assistance, you're not going to know exactly how to do it.
[00:26:28] So you're going to need some assistance maybe to find a worksheet or find a book or something that has walked that path before and can say, this is how you figured that out. And then some accountability either to yourself or to your party or to a friend, because we need accountability. Most of us. And then as you go complete that action, you get something that's beautiful and that's called momentum.
[00:26:58] And if you make that, [00:27:00] how, or what do you do an iterative step and you achieve it, then you get this thing called momentum, which gives you power. It gives you self-confidence. You get to say that a boy or that a girl, it gives you agency. And then what's the natural next question. Or what's that. Yeah. Now, what do I do?
[00:27:19] And so in our planning, we focus on that, keeping people on the wham, because now we feel that we have agency, which is this concept of, I have some control over things. And it's when we don't feel like we have control over things in financial planning, in our marriage, with our children, we get fearful and we get on our heels and we don't want to be on our own
[00:27:43] Scott Maderer: [00:27:43] well.
[00:27:43] And that's all the studies, go to any age. Study. Why do people leave their job and not in those words, but one reason, one of the biggest reasons people leave work is lack of agency. Now that's not how they say it. They usually don't use that terminology, but really, and truly that's [00:28:00] what it is.
[00:28:00] They feel like they have no control over their time. They feel like they have no control over their jobs that, decisions at work. Nothing I do matters.
[00:28:08] Roger Whitney: [00:28:08] Yeah. And it's a natural human. Need to feel that you have some control because that makes you feel empowered. Nobody likes to feel like they're just being acted upon.
[00:28:23] We just had the snow, the big snow storm down here in Texas. And we were out of power for three days.
[00:28:28]Nothing you can do in Texas. So I'm in Texas. We had temperatures at zero wind chills and the negative 10 plus no power for three days. And I'm a pretty agency kind of guy. I feel I'm like, okay, what do I do next? What do I do next life got really intimidating. Really quickly because I didn't have anything I could do.
[00:28:58] And that is a very [00:29:00] uncomfortable position. So in financial planning, we're talking about retirement and numbers and everything else. Those are good things from a long-term perspective. But if you think of whether it's retirement planning or accumulating assets or building a career, it's really helpful to think of it.
[00:29:18] Like a project management exercise. An agile type of project where it's iterative, because we don't know what new paths are going to come before us that we haven't even thought of yet. That might be interesting. And we also don't know when a big Redwood's going to fall right in front of the path that we really wanted to go on and we have to pivot.
[00:29:43]And if you're iterative you. You can handle those things better. The opportunities that present themselves or the roadblocks that present themselves unexpectedly, which is what always happens.
[00:29:54]Scott Maderer: [00:29:54] You can find out more about Roger and what he does over on his [00:30:00] website@rogerwhitney.com. He's also active on Twitter as Roger underscore Whitney, or you can find his podcast anywhere. Great podcasts are found under the retirement answer. Man, I'll have links to all of this over in the show notes as well.
[00:30:15]Roger, is there anything else that you'd like to share with the listener?
[00:30:18] Roger Whitney: [00:30:18] You got one shot at it. Don't waste your life. You can do it.
[00:30:21]Scott Maderer: [00:30:21] thanks so much for listening to the inspired stewardship podcast. As a subscriber and listener, we challenge you to not just sit back and passively listen, but act on what you've heard and find a way to live your calling. If you enjoy this episode. Please do us a favor. Go over to inspired stewardship.com/itunes rate.
[00:30:49] All one word iTunes rate. It'll take you through how to leave a rating and review and how to make sure you're subscribed to the podcast so that [00:31:00] you can get every episode as it comes out. Until next time, invest your time, your talent and your treasures. Develop your influence and impact the world. .