Planning Your Summer Vacation & Your Retirement

If you’re heading out on a road trip this summer, there’s a long checklist of items that you want to be sure you haven’t forgotten. And in retirement planning, some of those exact same items need to be addressed. Let’s look at some of the items that should appear on both your road trip checklist and your retirement planning checklist.


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John Stillman: Hello, and welcome once again to Wright Money Tips with Isaac Wright, chartered financial consultant and the president of Financial Dynamics and Associates, serving you throughout the greater Richmond area. I'm John Stillman, alongside Isaac. What's happening, brother?

Isaac Wright: I'm good. Listen, I covered this on our radio show, but I'll tell you, summertime and getting just a nice three months ... I know it can get hot and humid and all of the above, but at least you have three months where you can open up the back door in the morning, maybe sit on your porch. You can have a few minutes in the evening where the sun's not going down anytime too soon. There's always trade offs, but I know we're going to get into a little bit of "vacation planning" today, but I just really think the summertime and getting involved with having some extra time with the sun up is always a good thing.

John: Well, the great thing about podcasts is that you can be listening to this conversation that we're having I don't even know how many years into the future. It could be the Barron Trump presidency as you listen to this right now. But as we're having this conversation, we're right at the beginning of vacation season. So, let's talk about vacation planning and what that has to do with retirement planning.

John: Now, as you clicked on this and you saw vacation planning, you might've said, "Ooh, this seems like a nice deviation from the norm," but that's what we call, Isaac, a bait and switch, because we're not exactly talking about vacation planning. We're just using that as an analogy to talk about retirement planning.

John: But the whole idea behind this is that the average person spends more time planning a vacation than they spend planning their retirement, which is stunning, if you think about it. A vacation lasts maybe a week, and your retirement might last 30 years. But by all means, I hope you enjoy that vacation that you planned so well for.

John: So what we're going to do is take the things that you think about when planning for vacation and apply those to retirement planning. So, when you're going on vacation, Isaac, you might think about things like, "Well, where am I going to sleep? Where am I going to lay my head at night?" Well, that same question needs to be answered in retirement planning.

Isaac: Yeah. I mean, so yeah, I know we're sitting here being somewhat silly. Maybe this is really not silly in the fact that people really do plan more for their vacations than their own financial future in a big transition such as retirement or that phase of life, but let's try to make sure people understand why this is not so scary if you're either scared or just not thinking that you have time on your hands to plan for retirement. Most of us, if we spend an afternoon or an evening going through a vacation plan, let me tell you how this correlates to a retirement plan.

Isaac: Number one is where do you lay your head at night. Well, what I want you to relate this to when it comes to your financial or your retirement plan is, "Will I be staying in my current house or will I downsize?" It's one question to consider. "Will I have a mortgage payment in retirement, or will I not have a mortgage payment in retirement?" So we're all spending money. Sometimes we're spending thousands of dollars for a week's vacation at a bed and breakfast or a beach house. Well, let's try to make sure you're straight with your own house.

Isaac: So, a couple things to consider. Also, "Will I be better off to rent instead of owning in my later years?" That's been a bigger question we've received here in our office, and also would it be beneficial to move to another town or state where maybe taxes are lower or your lifestyle expenses may be different? So where you lay your head at night when it comes to your vacation, keep in mind, we can answer those same questions when it comes to your retirement.

John: Very important to think about housing in retirement. I'm just curious, Isaac, how often do you see people who are maybe downsizing and coordinating that with their retirement, or is it something that happens later on in retirement, or do most people stay in the house that they're in when they retire?

Isaac: I mean, so again, obviously there's always going to be caveats here. But a majority of people are really not downsizing, and I'll tell you why. Because they're not downsizing in the fact that the properties that they would downsize to may be newer, they may be in communities that have additional fees and expenses, and sometimes even though they may be downsizing square footage, they're not downsizing financially because a lot of these places are every bit, if not more expensive than where they already live.

Isaac: But we're finding more what I would call people considering whether or not if they want to outright sell their home, and if they do want to move into a, let's say continuing care facility, but just even having a senior living type of environment where the yard and everything else is taken care of, they're realizing that it's not "downsizing". It may be just kind of what I call a lateral move and just trying to make lifestyle easier.

John: So that's something to think about when planning for vacation and for retirement. "Where am I going to sleep?" How about this one, Isaac? "Where am I going to eat?" You think about that a lot when you're going on vacation, all the restaurants you want to hit, but what does that have to do with retirement planning?

Isaac: Well, I think retirement planning, when you're thinking about "where are you going to eat", I think that question really represents a broader question about your lifestyle. So will you be eating out more or less once you're retired? Are you planning on having a lot more discretionary money to go out and do more things? What about your hobbies?

Isaac: So when you're going on vacation, you're planning on all these restaurants to hit, and maybe these activities to hit. Will you have time for things like golf, scuba diving? We see so many people have different needs, wants and enjoyments that they want to fulfill during this time of life. Obviously, those things are not free.

Isaac: Also, will you be spending more time with your grandkids or incurring extra expenses? So when you're going out to eat and you're going on vacation, is it a vacation for just you and your spouse or is it a vacation for your whole family?

Isaac: Same with your retirement. Are you planning on being able to coordinate more money to take care of other people that you are close to in life, your family more specifically? So you have extra expenses if you're going to have to entertain and take along and bring other people along for the ride.

Isaac: So, where am I going to eat correlates very closely to how you would plan your retirement. Again, this is kind of a tongue-in-cheek episode, but it is still somewhat sincere on the fact of things that we see that we can help you with towards the role and the path to retirement.

John: One last question that we'll explore in this analogy, Isaac, which is, "Am I prepared for unexpected costs?" Again, when you're going on vacation, you want to be sure that you don't have your budget nailed down so perfectly that if something comes up ... You get off a roller coaster at Disney World that brings you through the gift shop at the end, which they're very adept at doing that. You come out of the line and you have to go through the gift shop before you can get back out into the park. If there's something there that the kids, the grandkids really want, you can't be in a position where you say, "No, no, no, we can't buy that because our budget is already tapped out." You have to have some spendable money, and things are going to come up. Same thing in retirement planning too, right?

Isaac: Exactly. Yeah. No, it's true. I mean, on vacation, you encounter a lot of expenses that you, let's say, may not have taken into consideration, or in some respects, some of these expenses can be minor. I'll never forget when I turned 18, my grandparents took me to Atlantic City. Of course, Atlantic City 25 years ago was different than Atlantic City today. There's casinos in every state.

Isaac: Well, back then, Atlantic City was the closest place you could go. But I'll never forget, and I know my grandparents have done this 25 times, but for me personally, I couldn't get past how much money in tolls you had to pay to get up there. It'll take you $20 to get each way up here just to get in tolls.

Isaac: When it comes to vacation and expenses, all of us deal with what I call things you don't know that you don't know. So, you have filling your rental car with gas, extra fees for your checked baggage because it weighs too much or because you have too many bags, something you saw in a gift shop, let's call it, that you wanted to get for a friend.

Isaac: But in retirement, unexpected cost can be a lot more substantial, and we need to think about how we'll pay for them. So, things that we don't see coming down the path of your monthly expense budget month in and month out, like home repairs, maybe having to purchase a new vehicle, and of course as we get older, may potentially have to deal with life-changing events towards needing care, disability care, home care, nursing home care. All of these things take a major factor towards that formula of having a successful retirement.

Isaac: So, as we all lead out to the summertime and enjoy our vacation, I wanted to kind of take a minute here just to kind of, again, be somewhat tongue-in-cheek, but also realize that when it comes to vacation planning, and some of you have already spent a good afternoon building a vacation plan, 9 times out of 10, we can help you coordinate a retirement plan in at or a little bit less time than it takes to put your vacation together.

Isaac: So keep all this in mind. We're here to help. Our office is locally right here in Richmond, but I think all of this, John, has been a good way to just introduce the fact that how many people are spending time doing things that they may need to be doing some other things.

John: Well, to clarify, if you'd like some help planning your vacation, Isaac is probably not the expert that you want to turn to. But, if you want some help planning your retirement, well, by all means, you should reach out to the team at Financial Dynamics and Associates. 804-777-9999. Could not have made that phone number any easier if we'd tried. 804-777-9999. Plenty more information available, as well as some other tools for you at

John: Isaac, always a pleasure. Talk to you again soon.

Isaac: Absolutely, John. Thanks.

Announcer: Information is for illustrative purposes only and does not constitute tax, investment, or legal advice. Always consult with a qualified investment, legal, or tax professional before taking any action.

Announcer: Advisory services offered through JW Cole Advisors Inc, JWCA. Financial Dynamics and Associates Inc and JWCA are unaffiliated entities.