Chapter One
Why Worry About
The Four Horsemen
You may have heard of the four horsemen of the apocalypse, written about by John in the book of Revelation. Those horsemen include conflict, war, famine, and death, sent out to wreak havoc on the world before the final coming of Christ. Whatever your religious affiliation, the four horsemen denote dire consequences. That's the kind of urgency I want to communicate with what I have deemed the four horsemen of retirement-four of the largest hurdles that many retirees face: longevity, inflation, taxes, and healthcare. These horsemen also tend to stick together in a herd, each helping their fellow riders.
How can you prepare yourself to help avoid the potential negative consequences these horsemen represent, separately and collectively? We will discuss each horseman in sequence, highlighting the unique challenges they present while also considering how they often work in tandem with one another. Rather than just simply explaining how to overcome them, I also want to dive into the background of each rider. Recognizing the nature of each rider, what contributes to their power, and how they might work together will provide a deeper understanding of the issues they pose, and, ultimately, it will contribute to the knowledge of how to help you surmount them as well.
One caveat: the goal is not necessarily to defeat the horsemen. The goal is to conquer the dilemmas they present. Some horsemen you cannot defeat no matter what you do. Others, longevity, in particular, you do not want to beat. You do want to be able to prevail over the challenges of longevity and the obstacles the other horsemen represent. Even though you cannot defeat the horsemen, you can overcome them, and that is what you are truly after in retirement.
I believe that longevity is perhaps the most pervasive of all the horsemen and may have the greatest impact on the other horsemen, so we will look at longevity first.
Where Does The Idea Of Retirement Come From?
Let's begin at the beginning.
Some of the earliest records for the concept of retirement date back to the time of the Roman Empire. Records show that in 13 BC, Emperor Augustus initiated a program that would pay soldiers who had served for twenty years in the military an ongoing income from the state. This was done to keep older soldiers, who were replaced by younger soldiers, from revolting against the empire.1 Since then, the concept of retirement has continued to evolve.
Despite its origin dating back to ancient Rome, the concept of retirement as it exists today is a new phenomenon. The remaining life expectancy in ancient Rome, if you had the good fortune to make it to adulthood, was around the age of fifty.2 German Chancellor Otto von Bismarck created Europe's first modern welfare state by establishing old-age pensions sponsored by the state in 1889.3 Bismarck enacted this program to stave off a revolt by encouraging citizens aged seventy and older to leave the workforce voluntarily to create room for younger, unemployed Germans. Bismarck is quoted as saying, "Those who are disabled from work by age and invalidity have a well-grounded claim to care from the state."4 It would not be until the depths of the Great Depression in the 1930s that the United States developed the Social Security program.
In the 1800s, if you were fortunate enough to make it to adulthood, life expectancy tapped out around age sixty.5 It wasn't until the twentieth century that we started to see dramatic rises in life expectancy, mainly due to improvements in sanitation, housing, education, and medicine.6 Now, the average American who makes it to adulthood can expect to live to age seventy-eight,7,8 a life span 56 percent longer than our Roman predecessors. If you make it to age sixty-five, you can expect to live to an average age of eighty-three,9 but even that is a little misleading.
According to the Society of Actuaries, there is a 50 percent chance that for a married couple, each aged sixty-five today, one spouse will be alive at ninety-two.10 Another thing to consider is the fact that these life expectancy tables account for risk factors that not everyone has. If you exercise regularly, are a nonsmoker, and assess yourself to be in good or excellent health, your life expectancy is anywhere from two to three years longer than the average. It's no wonder that 49 percent of pre-retirees underestimate their life expectancy by five or more years.11
The concept of retiring and expecting to live for another twenty-five to thirty years has existed for less than a century. In the context of human history, this new state of life, known as retirement, is in its infancy. It's no wonder that many are still trying to figure it out. For most, twenty-five to thirty years is the longest stretch of unemployment they have ever faced, and it comes with unique challenges. My aim is to address what is commonly identified as the four largest hurdles retirees face and provide a guide to help you overcome the four horsemen of retirement: longevity, inflation, taxes, and healthcare.
Forging My Own Path
Before you take a guided tour of the four horsemen of retirement, I thought it would be a good idea for you to meet the tour guide.
Raising his five children, my father never tried to persuade any of us to go into the family business. He would always say, "Do what you love, and the money will come." If he attempted to persuade us to do anything, it was to carve our own path. Despite this, I always found myself involved in the business at a young age. Growing up, I never idolized athletes, movie stars, or musicians. I've never asked for an autograph. My father has always been my hero, so as a young child, I was in awe of the family business.
My father didn't believe in paying us an allowance. Chores-like taking out the trash, cleaning up, and taking care of the animals on our little farm-were part of being in the family. You didn't get paid for those things. That's just what loving families do for each other. But he was happy to pay us to help with the business.
From the time I was five years old, I remember cleaning off the kitchen table with my siblings after a family dinner so we could stuff envelopes together to mail out invitations for an upcoming financial workshop my father was conducting. As I got older, I started setting up and tearing down those workshops for my father. Later those nights, back at home, I would recite the workshop from memory to my mother, making sure to mimic my father's cadence, motions, and even the timing of the jokes he told. In elementary school, if you asked me what I was going to be when I grew up, I would tell you that I was going to be a financial advisor just like my father.
Things changed for me when I entered high school, as they do for most adolescents. I had a short rebellious stage but really connected with one of my youth ministers. Knowing I wanted to live a life in service to others as my father did, but not wanting to blindly follow in his footsteps, I decided to go into full-time ministry. After high school, I attended Cincinnati Christian University to obtain my bachelor of arts in biblical studies. At this point, I was already the junior high youth minister for my church.
After my undergraduate studies, I decided to further my education by earning a master's degree in counseling with the goal of becoming better equipped to help others. To become licensed as a counselor, I had to complete a certain number of clinical hours under supervision after graduating. This led to me becoming the lead therapist at a residential unit at a local hospital. To qualify to be a resident in the program, clients had to have both a severe mental illness and a severe drug addiction. If the residents failed the program, they went to jail, so the motives of the residents were questionable at best. Looking back at it now, it was a program that wasn't particularly built for success.
As you might imagine, the burnout rate for the staff working with the type of population we were working with is significant. I poured my heart and soul into this job. Often, on my days off, I would swing by the unit to grab some of the residents so we could get breakfast together or go to the local community center. Regardless of my efforts, the failure rate was high. It wasn't so much about helping someone learn how to live a better life as much as it was trying to help them stay alive another week.
Things came to a head for me in the fall of 2015. I was set to get married the following year. I really started to think hard about the type of husband and father I ultimately wanted to be and become for my wife and family, as well as the type of lifestyle I wanted to provide. As I was mulling this over in my mind, as fate would have it, an incident occurred on the unit. A client I was counseling was on a mandatory seventy-two-hour hold and suicide watch. As I was often on call, I came in to see the patient, who was experiencing a breakdown. The patient became violent; somehow, he had gotten drugs into the facility and was now going through withdrawal. He physically lashed out, and to escape the facility, he pulled the fire alarm and fled. I never saw him again.
I had a career where I was...
