Thinking About Retirement, Part 2

There are three other retirement-related concepts I have been thinking about lately.  

One is how long people live, or in particular, how long I will live.  This is, of course, unknown.  So we look to historical statistics.  Mortality rates are dropping.  Life expectancy is increasing, at least in the US.  There's even a breakdown for Southeast Asian males, but the data is older.  Of course, these are statistics.  You'll often hear stories of people who drop dead two days after their retire.  Even in my own family, the men rarely live past 80.   This factors into when to claim Social Security.  Many articles and mathematical calculations explore break even points when claiming at 62, 67, or 70. One should also think about spousal benefits.  These decisions are extremely personal, hence "personal finance".

The second thing that is swirling around in my head is spending in retirement.  I could sum it up as being somewhere between "Die with Zero", a book by Bill Perkins, and leaving something for my heirs.  The 4% rule has been deemed as too safe, even by William Bengen, who introduced it in 1994.   You will spend less and less as you grow older, meaning you can withdraw more in your "go-go years".  Your withdrawal rate is also dictated by the sequence of returns during retirement.  I also believe in Warren Buffet's advice to "leave enough so that your heirs can do anything, but not too much that they do nothing."  How much is enough?  Again, that's personal.

The third is where to retire.  I love the San Francisco Bay Area.  Almost everything is here.  But it is very expensive.  It's great if one can afford it during retirement.  But for most people, including myself, moving away will make their retirement dollars go farther elsewhere.  Personal preferences - weather, proximity to retirement activities, family and community, even healthcare options - dictate your choices.  Again, it is extremely personal.

Thinking about Retirement, Part 1

I've heard the terms go-go years, slow-go years, and no-go years from podcasts.  And so with a little help from Google Gemini:

The terms

"go-go years," "slow-go years," and "no-go years" were coined by Michael Stein in his book The Prosperous Retirement. 

These terms are used in financial planning to describe the three distinct phases of retirement, characterized by different activity levels and spending patterns: 

• Go-Go Years: The early years of retirement (typically ages 65-75), when retirees are often active, healthy, and interested in travel, hobbies, and other activities. This phase generally involves higher discretionary spending.
• Slow-Go Years: The middle phase (typically ages 75-85), when health or energy levels might decrease, leading to a more relaxed pace of life, less travel, and a shift in spending priorities towards health care or home-related expenses.
• No-Go Years: The later phase (typically age 85 and older), where health and mobility challenges significantly limit activity, and expenses shift heavily toward long-term care and medical support.

I've also heard the terms: mobile, semi-mobile, and immobile, but the Gemini results were not as clear as the above.

Another term that has recently come up was "healthspan" as opposed to "lifespan".  Again, turning to Gemini for help:

Lifespan

is the total number of years a person lives, from birth until death, a measure of quantity. Healthspan, in contrast, refers to the number of years lived in good health, free from chronic diseases, disabilities, or significant illness. The goal of healthspan is to add "life to those years". 

Key Differences

Feature

	Lifespan	Healthspan
Definition	Total years an individual lives.	Years an individual lives in good health, without chronic conditions or disabilities.
Focus	Quantity of life (how long you live).	Quality of life (how well you live during those years).
Measurement	A clear, objective endpoint (age at death or life expectancy).	More complex, often measured by various health indicators like disease-free years, functional capacity, or biomarkers of aging.
The Gap	Lifespan typically exceeds healthspan, with the average global gap being around 9-10 years spent with disease or disability.	The goal of longevity research is to close the gap between healthspan and lifespan so that individuals remain healthy until near the very end of life.

In essence, while medical advancements have successfully increased the average lifespan, they have not proportionally increased the healthspan, resulting in more years lived with illness or a reduced quality of life. The focus on healthspan is a shift towards ensuring that extended years are vital, active, and independent.

And so, the goals of retirement should be to a) plan for the go-go years, slow-go years, and no-go years, and b) to extend the go-go years, and maybe the slow-go years, or "healthspan" as long as possible.