Randall Davey
I principally serve highly compensated medical professionals: doctors of dentistry and medicine. I have lectured to and consulted with newly minted doctors and those transitioning to retirement. Many welcomed an opportunity to stress- test and audit their in-place financial plans and products to identify unnecessary risks, fees or ill-advised tax strategies. One exception comes to mind.
He is a fifty something E.R. doctor in the Southwest. While he was open to meet me, he was quick to say that he was “all good financially.” Without my asking, he offered the following proof points.
“My wife and I have a million dollar home, a chalet near Tahoe, nine cars (some for his kids and some for her kids as well as his sister) and we do at least one European vacation a year.” “I make in excess of $500,000 a year so we pretty much do what we want.” “Like I said, ‘we’re good.’”
I asked for and he granted permission to ask a few questions.
“How much are you driving to retirement?” His much younger wife answered, “we contribute the max to his 401 (k) and the hospital matches up to 4%.” “I tell him that we are going to be the richest people in the nursing home!”
Fact – not fiction – the man had $150,000 in his retirement portfolio. A previous marriage ended in divorce concurrent with losing a job so he had to implode his retirement plan to survive. Did I mention – he wants to retire at 65 – that he owes $800,000 on the million-dollar home – is financing all of the cars – as well as the Tahoe property and here’s the kicker. I asked, “how much money to you keep liquid either in money market, savings or mutual funds” and he quickly said, “Two.” I clarified, “Two hundred thousand?” He said, “No. Two thousand.”
It’s not my practice or proclivity to judge. It is my business to assess. The facts simply didn’t support the assessment that he and his wife and their kids were “good financially.” Far from being the richest people in the nursing home, they work walking headlong into an uber humble retirement – if he opts out at 65 or 75.
The prevailing question – if you save what you are currently saving, and invest what you are currently investing and spend what you are currently spending, how much money will you most likely have on which to live in retirement? The answer may prompt you to save more, spend less – or – give more but until one knows without a rigorous exam.
Imagine a patient who is due for a physical, walking in and saying, “physically, I’m good.” What would you say? “Here’s the cup!” Assessment without grounding is a fool’s game. Don’t be a fool. Randall E. Davey, CAP® is a financial advisor with Guide Advisors, Inc. In certain circumstances, he may offer insurance as a sole proprietor or through Guide Advisors, Inc. He resides with his wife, Bonnie in Mesa, Arizona. Randall can be reached at randall.davey@guideadvisors.com or by phone at 425.478.5668. Insurance and advisory services are offered through Guide Advisors, Inc., a Registered Investment Advisor in the State of Washington and other jurisdictions in which it may conduct business. The information contained herein should in no way be construed or interpreted as a solicitation to sell or offer to sell advisory services to any residents of any State other than the states listed above or where otherwise legally permitted. All written content is for information purposes only. It is not intended to provide any tax or legal advice or provide the basis for any financial decisions. The information contained in this material has been derived from sources believed to be reliable but is not guaranteed as to accuracy and completeness and does not purport to be a complete analysis of the materials discussed.
I principally serve highly compensated medical professionals: doctors of dentistry and medicine. I have lectured to and consulted with newly minted doctors and those transitioning to retirement. Many welcomed an opportunity to stress- test and audit their in-place financial plans and products to identify unnecessary risks, fees or ill-advised tax strategies. One exception comes to mind.
He is a fifty something E.R. doctor in the Southwest. While he was open to meet me, he was quick to say that he was “all good financially.” Without my asking, he offered the following proof points.
“My wife and I have a million dollar home, a chalet near Tahoe, nine cars (some for his kids and some for her kids as well as his sister) and we do at least one European vacation a year.” “I make in excess of $500,000 a year so we pretty much do what we want.” “Like I said, ‘we’re good.’”
I asked for and he granted permission to ask a few questions.
“How much are you driving to retirement?” His much younger wife answered, “we contribute the max to his 401 (k) and the hospital matches up to 4%.” “I tell him that we are going to be the richest people in the nursing home!”
Fact – not fiction – the man had $150,000 in his retirement portfolio. A previous marriage ended in divorce concurrent with losing a job so he had to implode his retirement plan to survive. Did I mention – he wants to retire at 65 – that he owes $800,000 on the million-dollar home – is financing all of the cars – as well as the Tahoe property and here’s the kicker. I asked, “how much money to you keep liquid either in money market, savings or mutual funds” and he quickly said, “Two.” I clarified, “Two hundred thousand?” He said, “No. Two thousand.”
It’s not my practice or proclivity to judge. It is my business to assess. The facts simply didn’t support the assessment that he and his wife and their kids were “good financially.” Far from being the richest people in the nursing home, they work walking headlong into an uber humble retirement – if he opts out at 65 or 75.
The prevailing question – if you save what you are currently saving, and invest what you are currently investing and spend what you are currently spending, how much money will you most likely have on which to live in retirement? The answer may prompt you to save more, spend less – or – give more but until one knows without a rigorous exam.
Imagine a patient who is due for a physical, walking in and saying, “physically, I’m good.” What would you say? “Here’s the cup!” Assessment without grounding is a fool’s game. Don’t be a fool.
Randall E. Davey, CAP® is a financial advisor with Guide Advisors, Inc. In certain circumstances, he may offer insurance as a sole proprietor or through Guide Advisors, Inc. He resides with his wife, Bonnie in Mesa, Arizona. Randall can be reached at randall.davey@guideadvisors.com or by phone at 425.478.5668. Insurance and advisory services are offered through Guide Advisors, Inc., a Registered Investment Advisor in the State of Washington and other jurisdictions in which it may conduct business. The information contained herein should in no way be construed or interpreted as a solicitation to sell or offer to sell advisory services to any residents of any State other than the states listed above or where otherwise legally permitted. All written content is for information purposes only. It is not intended to provide any tax or legal advice or provide the basis for any financial decisions. The information contained in this material has been derived from sources believed to be reliable but is not guaranteed as to accuracy and completeness and does not purport to be a complete analysis of the materials discussed.
Guide Advisors, Inc. 19125 North Creek Parkway, Suite 120, Bothell, WA 98011 206.486.2477