If you're in your early 60s with a couple million dollars saved for retirement, you're probably

starting to ask yourself, is now the time to retire? Should I do it now? Should I wait till 65? What's the right decision from me? Well, that's exactly what we're going to show in today's case study. We're going to show you how these seemingly little decisions can have huge implications over the duration of your retirement. And instead of just telling you about it, I'm going to show you an actual case study to illustrate this.

So what we're going to do is we're going to take a look at Michael and Lisa's plan. This is Michael and Lisa. Michael and Lisa have a couple million dollars saved between their retirement assets. They have a joint investment account, so a brokerage account here. They have a 401k, Lisa's IRA, leases Roth IRA. You can see their ages today are 62.

They have a couple million dollars. They also have about $900,000 or so of equity in their home. Now, as of today, that's equity, that's value, but it's not necessarily something they're going to live on in retirement, at least not initially. So they have equity in their home, they have a couple million dollars in their 401k, And they're asking themselves, can we do this? Can we retire? So they want to retire at 65. That feels like the age they're supposed to do it. Medicare kicks in. That seems like a traditional age to do so. So that's what we're starting with to see is 65 the right age to do so. And their expenses, if we look at a simple projection of what they're spending right now, are $14,000 per month.

Now, don't get too tied up on the specific expenses. Your expenses might be $4,000 per month, or your expenses might be $24,000 per month. Regardless of what they are, look at the framework that we're going to go through as we walk through this. So their core expenses are 14,000 per month.

We have a separate travel budget right here.

I'm keeping that as a zero right now, and you'll see why in just a couple minutes of why I'm doing that, but 14,000 per month, which to them covers their travel. They spend about 50,000 per year, 48,000 per year or so on travel, and the other 10,000 or so per month is actually core living expenses for them. Then beyond that, they had their medical expenses. If they were to retire

pre-Medicare, they would need to be able to plan for $9,600 per year for each of them for medical

costs. After age 65, they had their Medicare Part B and Part D premiums, and then they're

estimating an additional

$4,000 per year of out-of-pocket costs beyond that. So these are their expenses. These are

their goals. Their income today is their salaries. So they make a healthy income today. This is

supporting all of their needs. When they retire, of course, that goes away. But Michael will have

his Social Security at age 70.

You can see we're planning for 4,000 per month for Michael. Lisa will have her benefit at 70 of $3,900

per month. And then they expect an inheritance. There's probably something there, but we're showing

zero. We want to see, can you retire? Can you make this happen regardless of whether or not you

receive anything

in an inheritance, then we can illustrate what would the actual impact of that inheritance be.

But for now, we're planning for zero so that we don't bake that into their initial plan

planning scenario. So that's their income. They're both saving 10% to their 401ks. And what we want

to know is, are they on track to do all this? So I'm going to go to their retirement tab and go to cash flows. The cash flows is the lifeblood of everybody's retirement strategy. If you want to know if you can retire, the question is, do you have enough income flows coming in to meet your expense outflows going out? Here's how we look at this for them.

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