Retirement On The Gridiron

*Note for Mr. Stillman's opus with John Stillman of Rosewood wealth management we find ourselves right here in the middle of football season.

Watch a lot of football games lately. At this time of year to get five football on TV almost every night a week so want to take some concepts in the game of football and apply them to our retirement planning for small we talk about this all the time on the show. The red zone. What exactly does it mean when you're in the red zone and how does that relate football yes so the red zone obviously is important both for the offense and defense. In fact, was watching the Panthers.

Some of those this past week or the week before.

They were talking about how the Panthers had not yet stopped a team once they got in the red zone in the red zone against the Panthers you were going to score and that's what you want out of your offense you want to be sure your scoring points in the red zone. You can't have turnovers you can't march all way down the field and turned over the red zone. You can't get down to the three or 4 yard line and then have to settle for a field goal you get that close more often than not, you need to touch down if you have to get a field goal from time to time, so be it. Graham Goodenow doesn't need to be anywhere close to the red zone, in order to score for the carrier's ticket for midfield but so often you see teams make mistakes in the red zone and those mistakes are so magnified because it's so hard to get there in the first place yeah and if you screw it up. Once you get there, was really hard to get back some time to get to capitalize on your opportunities when you're in the red zone.

Well, there is also a red zone when it comes to financial planning, and that's the last 5 to 10 years before you retire. That's like being inside the 20 yard line on the football field in the same things are true. You can't afford to make mistakes, you worked really hard to get to this point. It's not easy to get there but you in saving and investing for 30 or 40 years and now here you are in the red zone. You can't afford to screw it up. So make sure you're not making mistakes.

Make sure your decisions are smart but you being as efficient as possible that you're not taking too much risk because think about it in football terms. You know you don't want to be throwing a lot of really risky passes that could get picked off in the red zone is right because you know if, at the very least if you just hold on the ball. You can at least get a field goal out of it.

Yes, we'd rather have a touchdown. You have to at least get that field goal.

So don't take any chances that are going to prevent you from allowing that to happen, but same thing. Retirement planning. Let's not take risks that are necessary. We work so hard to get all way down the field here was not screw it up while coaches and players and fans alike all get really frustrated with her team gets into the red zone and comes up empty. For heaven sake you don't want that to happen about the hurry up offense. Now hurry up offense can be really good when it comes to football, but sometimes in retirement planning doesn't work so well that's it well.

So you see the hurry up offense. We see it working like your offense is done nothing all game and suddenly you're in that two minute drill in your throwing the ball around the field like well just run this office all the time but obviously the defense would react to it and it wouldn't work that way all the time but it can work in football when you know you keep the defense on the heels they can't get their substitutions in on time and your controlling way that the game is unfolding from an offense of standpoint.

So yeah, when you get down when you're behind in the fourth quarter drama hurry up offense you trying to create as many plays have as many possessions as possible to give you chances to catch up well in retirement planning.

This doesn't work, you might feel tempted. If you're behind in the fourth quarter, if you will of your working life getting near the end of the game you might feel what you want to take more risk close the gap but that's almost never the best way to fix the problem you you're much better off to either increase your rate of savings or maybe plan to work another year or two longer than you'd originally thought you would.

Or maybe plan on spending a little bit less in retirement. If you find that your behind and the assets that you have aren't going to create the lifestyle you want. There are better things to do than try to ratchet up the risk and make up for lost time must not be up there throwing the ball around the field.

If your quarterback is less than average. Right. So that's the analogy that will take from the hurry up offense. I like that analogy that was good. This could think of an airport on your feet well victory formation in football, you know, we all know about the victory formation and perhaps you can explain that for the non-football fans out there, but how does that apply to retirement planning. Also victory formation is basically the opposite of the hurry up offense right. Hurry up offense your down lately game you're trying to catch up with victory formation you're leading late in the game and use want the game to be over there, and once you're at that point where you winning the game. Let's not take any chances we will have to so in football were you doing your taking a knee. You know your Europe points is a minute and 1/2 left in the game just taken me four times and be done right. Don't play any more football than you have to.

Yeah exactly you don't care about getting more yards you're not trying to score more.

All you care about is holding on the ball. If you don't give the ball back to the other team, you can't lose they get score while you have the ball, so just hold onto the ball well in retirement planning.

Sometimes you get to the point where you have enough money to create the lifestyle that you want all you need to do is make sure that you don't lose what you have. You need to design your portfolio in such a way that urine victory formation you're taking a knee you're running out the clock. You're not playing anymore football then you have to you're not taking any chances. You don't have to take in the analogy I talked about last week was this couple who they are investing as if they're in their 20s or 30s and their both in their early 60s and they know they're taking too much risk they didn't know how much risk they were taking. They knew they were taking too much when we put it in the stress test, it showed that they have a risk number of 80 which basically are program grades that from one, 201 is no risk at all. One is sitting in cash in the bank. 100 is daytrading super high risk right so there an 80 out of hundred that's really high risk is high risk for anybody that's basically how somebody in their late 20s early 30s should be invested here. They are at 64 and 63 respectively may have a risk number of 80 and so what we end up with is the situation where every month the same to himself. You know what I need to take some of the risk down a little bit but you know I really meant a lot of money last year to let me just see if I get one more month out of it. We just push it one more month and then I'll take some of the risk out after that and what that's equivalent to his being out there up eight points in the football game and you're still throwing the ball down the field is still try to make long passes your throwing in the double coverage don't do that just taken the and run at the clock and that's what I had to impress upon them is look you scored enough points already. Just don't fumble the ball and you'll be okay. At that point you just need to be thankful for what you got it. Don't try to get more. One other thing I wanted to ask about here. This is how football relates to retirement planning. I think everybody knows that you know when your you have a football team.

You don't want to just send 11 guys out there on the field with no game plan. No coaching whatsoever. There is no question in my mind the good coaches make a difference in this same thing is true with your financial planning for your retirement left right and you know you seen the teams where they have the same coach for years and years and years and look at the Pittsburgh Steelers. They had three coaches in the history of their franchise hub and then you have other teams while let's take the Browns just right across the state line from the Steelers to have a new coach every two or three years. They had coaches that were only there for one year and you have no continuity and so it's really easy to tell the good programs versus the bad ones.

This applies in college or the NFL. You have a lot of coaching turned running at the college level will always tell you one of the keys to success is not just having the same head coach for many years but continuity with the assistant coaches right having those same guys with you.

Year after year after year.

You think back to the John Bunning days that was a big issue. He couldn't hold onto good assistant coaches and it was a constant revolving door for some of those position coaches and that was one of things that Butch Davis did really well was he was able to get good assistance and keep them around so how does assault relate to our retirement planning will some people want to be successful.

Are there trying to be successful without a coach at all, which is possible.

There are some people who can do very well managing their investments by themselves. That's a very small sector of the population, but it does exist. Some people keep the same coach year after year. Pretend you had a football coach who had gone wanted 10 yeah for five or six years and pretend it was Mack Brown's first years is one intent.

Both of his 1st°.

Alana feels wanting to in every single year for eight years. That's not good and he was still Caroline nobody would say this is okay.

What sometimes your coach does bad enough job that you need to get a new coach and so a lot of times it's an emotional decision people been working with an advisor and they know they know that they're not getting the support that they should be another not getting the great advice they should be. They're not getting the communication. They should be getting. But if somebody we work with for 20 years so I don't want to upset them run or make a change.

Well imagine having that mindset will football coach yeah he's been wanting to and for the last eight years but no I don't want to hurt his feelings by getting the full book you would never say that there but a lot of people do that with their financial advisor and so sometimes you trying to do without a coach and you. You just need a coach. To show you where the pitfalls are the mistakes that you don't know you might be making.

So that's one person to address the other person to address is somebody who knows they have the wrong coach but they don't hurt that person's feelings by making the change. And then there's this third category you know you hello you think your coach is good, but you really don't know.

It will be like heaven football team and not actually knowing whether or not you want to lost games. He's got the ink. They do a pretty good job. You think the team looks pretty good, but you really have no idea whether you're winning or losing. And so if you fall into any of those categories by all means come in and sit down with us have a conversation with figure out where you stand and if you need to make a change in your financial coaching situation or not you been listening to Mr. Stillman's opus from Rosewood wealth management and certainly there are a lot of parallels between preparing for football and preparing for your retirement. We appreciate your listening John Stillman, of course, the president and founder of Rosewood wealth management Carolina once towards doing business as Rosewood wealth management is a registered investment advisor in the state of North Carolina. The material presented is intended to be general information and should not be construed by any consumer is the rendering of personalized investment advice