Rags to Retirement

Rags to Retirement - Gail Liberman and Alan Lavine

Stories from people who retired well on much less than you'd think!

1. Living it Up South of the Border - The retired couple moved to Mexico. It is a new language and a new culture but they can be just themselves. The cost of living is cheaper but there are some other challenges. The lifestyle has improved with less money. Few things to consider:
i) If possible, learn the language before you move
ii) Understand the tax situation of the country
iii) Evaluate the climate and activities of the area
iv) Research how widespread crime is
v) Evaluate a country's health care system
Other criteria to pick a place to retire:
i) weather
ii) cost of living
iii) affordable housing
iv) cultural programs
v) health care
vi) health care
vii) leisure
viii) pollution
ix) crime
x) transportation
xi) political stability
xii) health hazards
xiii) access to technology

2. Another one living in a boat as owning a house is too expensive

3. Another bachelor lived in Florida. He lived within his means and never run up a credit card. He does not drive and take public transportation. He lives in federally subsidized housing, restricted to senior citizens on limited income.

4. To prepare for retirement, it is important to shift to low-risk investments that are sure to pay you monthly income. Low risk options to consider:
i) Treasury securities
ii) Bank deposits
iii) Money market mutual fund
iv) Short-term government bonds and bond funds
v) Insured Municipal bonds
vi) Fixed annuities

5. Another couple live in RV and get the money for retirement by selling their house. They paid cash for their truck and trailer, they have no debt.

6. Always buy a house and don't rent.

7. The younger you are when you start planning for your retirement, the more money you'll have and the earlier you can retire. Those who are motivated, who apply good discipline to savings. They can retire young. They have not given up work entirely. They do little work they choose. They have more free time to manage their investment and they believe bear market happen every 5 years on average. They avoid difficult bear market and money still grows. They try to stay in good health, getting in at least two hours of physical activity daily. They goal to find the city to live is a city of less than 50,000 people that was clean and that had low crime and no snow. They wanted a good public library, discount movie theaters, bowling, tennis, hiking, cultural activities, and beautiful scenery. They also aimed to be relatively close to a large city.
"One huge mistake people make is they spend an inordinate amount of time figuring how much money they're going to need," says retirement planning expert John F. Wasik. "You can make one or two decisions to make it affordable at an earlier age - like relocate your home"

8. Getting good health
i) Don't smoke
ii) Don't drink alcohol excessively
iii) Keep your body weight, lose the extra weight
iv) Exercise regularly
v) Brush and floss your teeth daily
vi) Get an annual physical check-up
vii) Use sun block
viii) Check out services at dental and medical schools
ix) Buy generic drugs
x) Eat plenty of fruits and vegetables, as well as foods that are high in fiber
xi) Avoid eating junk food that is high in fat and cholesterol
xii) Get a good night's sleep
xiii) Be spiritual healthy too

SUMMARY
1. Find a cheaper way to live - sailboat, RV, lower cost countries
2. Cut your medical expenses - exercise and eat properly, or live in lower medical cost countries
3. Plan for your retirement at a young age - have longer time to save and grow your money
4. Obtain a job with great retirement and/or medical benefits
5. Set goals for yourself - have meaning
6. Become more social - getting together with friends and family is a cheap, yet extremely fulfilling form of entertainment
7. Taking advantage of free or low-cost sources of entertainment - Libraries, museums
8. Make the most of federal benefits to which you might be entitled - federal subsidized housing, social security, suplemental income
9. Do it yourself - repairs, meals, etc
10. As you near retirement, invest conservatively - not to lose money
11. Cut taxes as much as possible
12. Get rid of your car
13. Consider downsize your house or reverse mortgage - get extra money for retirement
14. Maintain a positive attitude - thinking postively can get you through the worst of times