Why Am I Broke? by Bill Roberts, Wealth Coach

Services for Real Estate Pros with Brooks and Dunphy Real Estate DRE 00527512

Why Am I Broke?

This is a question that many Baby Boomers ask themselves a few years into their retirement.

It is not a question they wanted to ask but it is inevitable anyway.

Most retirement planners only know one approach to retirement: SPEND DOWN YOUR ASSETS.

They believe that your working years are to be used to build up your assets. And when you choose to retire you will spend down your assets (until they are gone). In other words, until you are broke.

So here you are asking yourself WHY AM I BROKE?


The fault is yours as well as the planner’s. You believed them when they said it was time for you to retire.  You “bought” whatever it was they were selling. Maybe you bought an annuity.

And you believed them when they said you wouldn’t need as much money each month during retirement as you did during your working years.


Most Boomers discover rather quickly that retirement is expensive. You have too much time on your hands, and the only thing we know is to spend more money to fill up those “extra” hours.

Face it, you really don’t want to change your lifestyle just because you are no longer working. Your car costs you just as much as it did before retirement, your house costs just as much as it did before retirement, and you still eat just as much as before (if not more) and it still costs the same. Nobody wants to cut your bill in half just because you are retired.

In fact, you will find more opportunities to spend money after you retire because now EVERY DAY IS SATURDAY.

As a general rule most of us will spend 15-25% more each month after we retire.

So the financial planner that you believed in figured that you only would need 80% as much money after retirement than you did before. It is not their fault. It is what they have been taught.

So they set up a plan to spend down your assets at a rate of 80% of what you needed before. And they figured that you would only live another 15 years. After all, that is what the mortality tables say.

So here you are wondering how you are going to keep on living since all your money is gone. And you are wondering why you want to. Life is no fun when you are broke.

Well the solution for this dilemma is to NOT RETIRE until you have enough passive income to support your lifestyle FOREVER, not just 15 years.

If you plan on living forever and you accumulate enough income from investments to not only last that long, but to grow at a rate higher than the rate of inflation, then you should be able to relax and enjoy your retirement.

As a general rule, right now the average Baby Boomer couple will need about $2,000,000. In assets to generate enough on-going passive income to support themselves in the fashion to which they have become accustomed.  This number will be different for everybody depending on the lifestyle choices we will make. It will either be higher or lower depending on where we choose to live and how many times we plan on taking the grandkids to DisneyWorld.

But since 90% of us have only $100,000. OR LESS in our retirement plans, it is obvious that we have FAILED at planning for retirement.

So, what is the answer?

Well, if we continue doing what we have been doing, we will have the same results.  We will not EVER have enough money to retire.

We need to do something differently than we have been doing it. Because if we have spent 40-50 years accumulating our retirement funds and we only have 5-10% of what we will need, how many  more years will it take to get that number up to a million dollars or more? At your current rate you will need another 4-500 years.

If that isn’t a good reason to do something differently, I don’t  know what is.

Or you can just decide to work until you die. For most Baby Boomers that is exactly what they intend to do.

But if you want to, you can make some changes now that will allow you to actually retire within ten to twelve years.

It is a multiple pronged approach: build more sources of residual passive income and adjust your lifestyle choices to fit your “new” budget.

OK, you want to do this. So where do you start?

The obvious starting point is a plan. A real plan that will get you to your destination.

Begin with your actual budget. Not a fictional budget but an analysis of every penny spent over the last couple of years.

And then think really hard about how and where you want to live after you quit working. Maybe you just want to Age-in-Place, maybe you want to move off-grid, or even become an Ex-Pat in Mexico, Panama, or somewhere in the Far East or Europe. Think about it HARD because each separate destination has separate problems and opportunities that need to be considered.

Now that you have determined your budget and lifestyle, you are ready to start making the right moves to get there.

You will need a different kind of financial planner. Not one that wants to sell you an annuity, but rather someone who will help you build your wealth. A wealth builder is completely different from a wealth spender.  If he (or she) says something like “you will need to spend down your assets at a rate of 4% per year in order to last your whole life.” then run away fast. On the other hand, if he (or she) says “let’s look at how we can grow your assets 15-20% per year so that you never go broke” then you are in the right place. Of course a rate of return cannot be guaranteed, but  historically wealth funds have returned about 8% per year over time. That gives us a good starting point and a yard stick to measure against.

Well, let’s get started.

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Please comment. All comments are greatly appreciated.

Bill Roberts


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Kathy Streib
Room Service Home Staging - Delray Beach, FL
Home Stager - Palm Beach County,FL -561-914-6224

Hi Bill- so happy to see you back here. I think that we don't spend enough time teaching young people, and the rest of us about retirement. Afterall, when you're starting out in your career, retirement is a long way off. The best thing we ever did was fire our financial planner and take over ourselves. 

Apr 26, 2018 04:32 PM #1
Bill Roberts
Brooks and Dunphy Real Estate - Oceanside, CA
"Baby Boomer" Retirement Planner

Hi Kathy Streib You are right on both counts: we need to teach "retirement" a little  more vigorously, and yes, you did the smart thing by taking the reins yourself.

And it is nice "seeing" you, as well.

Thank you.

Bill Roberts

Apr 26, 2018 06:01 PM #2
Nina Hollander
Coldwell Banker Residential Brokerage - Charlotte, NC
Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor

Hi Bill... and now I know it's a good thing I continue to work even though many think at my age I should have retired a long time ago... it keeps me from over-spending because I'm too busy working! The fact that so many have only about $100,000 in retirement plans is really scary. Meantime, good to see you in the Rain and hope all is well at your end.

May 01, 2018 10:52 AM #3
Bill Roberts
Brooks and Dunphy Real Estate - Oceanside, CA
"Baby Boomer" Retirement Planner

Hi Nina Hollander Yes, all is well. But I can't kssp my wife from spending even though she still works. When she retires it will really be scary.

Actually, the stats say that 90% have $100,000 OR LESS. Yes, it is scary indeed.

Nice to see you.

Bill Roberts

May 01, 2018 12:27 PM #4
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