Financial planners talk about three phases in retirement: The go-go years, the slow-go years and the no-go years.
Expenses tend to be highest at the beginning and end of retirement – creating a U-shape. But many people think of retirement spending as a constant variable.
“As they enter retirement, especially early in retirement, they see themselves spending all sorts of money and then they can’t envision themselves cutting back,” says Jonathan Swanburg, a certified financial planner in Houston, Texas.
But the big trips and experiences you are planning for your golden years are often one-time things and, as you grow older, you may naturally travel and spend less.
Then at the end of life, there is a sharp rise in spending on things such as long-term care.
“It kind of looks like a smile when you look at all the numbers,” says Michelle Crumm, a financial planner in Michigan.
Here is how to lean into this spending pattern.
1. Clarify your goals
A U-shaped retirement plan works for many people – but not all. You and your financial professional should discuss what you hope to get out of your retirement.
“If it’s a couple, you’ve got to make sure they’re on the same page,” Ms Crumm says.
Some people, she says, want to enjoy holidays up to the last day of their lives, buy new houses or always give money away.
“They’re not good candidates for a smile strategy.”
2. Keep fixed expenses low
The more you can simplify your balance sheet – pay off your mortgage, eliminate credit card debt – the more freedom you will have to adapt your retirement spending as needed.
If the stock market takes a dive, you can drop discretionary expenses so you withdraw less from your savings that year.
“It’s figuring out where we can cut back in the event that things do go haywire,” Mr Swanburg says.
For retirees with larger fixed expenses or who are supporting their children, it may not be possible to budget for swanky trips in early retirement years.
“Maybe we do not have those big early expenses because we don’t have a lot of levers to pull in the event they need to cut back,” Mr Swanburg says.
3. Make plans for long-term care
People spend more in late life on health care and long-term care, creating the back end of the U-shape. Long-term care insurance (or a product like it) can make a big difference here.
Hybrid policies that combine permanent life insurance with a long-term care rider have the advantage of paying out a benefit to someone no matter what happens, but they can be expensive.
If clients do not have long-term care insurance, “we usually recommend holding back $300,000 because that’s, on average, what people are going to need for long-term care”, Ms Crumm says.
If you have equity in your home, you may be able to use that to cover end-of-life expenses.
“In most situations, you can take that home equity and repurpose it for the extra expenses related to long-term care,” says Joel Cundick, a financial planner in Virginia.
4. Manage income strategically
The way you withdraw income affects everything from the taxes you pay to the price of health care.
You might benefit from offsetting capital gains by claiming losses. Working with an adviser on retirement income optimisation can give you more flexibility when you need it.
“There are smart ways to take money out of the retirement plan, and there are smart ways to set yourself up for retirement income,” says Catherine Valega, a financial planner in Winchester, Massachusetts.
“Work with someone to make sure you are tax optimising your financial life.”
MATCH INFO
BRIGHTON 0
MANCHESTER UNITED 3
McTominay 44'
Mata 73'
Pogba 80'
What's in the deal?
Agreement aims to boost trade by £25.5bn a year in the long run, compared with a total of £42.6bn in 2024
India will slash levies on medical devices, machinery, cosmetics, soft drinks and lamb.
India will also cut automotive tariffs to 10% under a quota from over 100% currently.
Indian employees in the UK will receive three years exemption from social security payments
India expects 99% of exports to benefit from zero duty, raising opportunities for textiles, marine products, footwear and jewellery
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1. Fasting
2. Prayer
3. Hajj
4. Shahada
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MATCH INFO
Quarter-finals
Saturday (all times UAE)
England v Australia, 11.15am
New Zealand v Ireland, 2.15pm
Sunday
Wales v France, 11.15am
Japan v South Africa, 2.15pm
COMPANY%20PROFILE
%3Cp%3E%3Cstrong%3ECompany%3A%20%3C%2Fstrong%3EGrowdash%0D%3Cbr%3E%3Cstrong%3EStarted%3A%20%3C%2Fstrong%3EJuly%202022%0D%3Cbr%3E%3Cstrong%3EFounders%3A%20%3C%2Fstrong%3ESean%20Trevaskis%20and%20Enver%20Sorkun%0D%3Cbr%3E%3Cstrong%3EBased%3A%20%3C%2Fstrong%3EDubai%2C%20UAE%0D%3Cbr%3E%3Cstrong%3EIndustry%3A%20%3C%2Fstrong%3ERestaurant%20technology%0D%3Cbr%3E%3Cstrong%3EFunding%20so%20far%3A%3C%2Fstrong%3E%20%24750%2C000%0D%3Cbr%3E%3Cstrong%3EInvestors%3A%20%3C%2Fstrong%3EFlat6Labs%2C%20Plus%20VC%2C%20Judah%20VC%2C%20TPN%20Investments%20and%20angel%20investors%2C%20including%20former%20Talabat%20chief%20executive%20Abdulhamid%20Alomar%2C%20and%20entrepreneur%20Zeid%20Husban%3C%2Fp%3E%0A
MATCH INFO
Norwich City 1 (Cantwell 75') Manchester United 2 (Aghalo 51' 118') After extra time.
Man of the match Harry Maguire (Manchester United)
Defence review at a glance
• Increase defence spending to 2.5% of GDP by 2027 but given “turbulent times it may be necessary to go faster”
• Prioritise a shift towards working with AI and autonomous systems
• Invest in the resilience of military space systems.
• Number of active reserves should be increased by 20%
• More F-35 fighter jets required in the next decade
• New “hybrid Navy” with AUKUS submarines and autonomous vessels
Defending champions
World Series: South Africa
Women’s World Series: Australia
Gulf Men’s League: Dubai Exiles
Gulf Men’s Social: Mediclinic Barrelhouse Warriors
Gulf Vets: Jebel Ali Dragons Veterans
Gulf Women: Dubai Sports City Eagles
Gulf Under 19: British School Al Khubairat
Gulf Under 19 Girls: Dubai Exiles
UAE National Schools: Al Safa School
International Invitational: Speranza 22
International Vets: Joining Jack
Chelsea 2 Burnley 3
Chelsea Morata (69'), Luiz (88')
Burnley Vokes (24', 43'), Ward (39')
Red cards Cahill, Fabregas (Chelsea)
What is a Ponzi scheme?
A fraudulent investment operation where the scammer provides fake reports and generates returns for old investors through money paid by new investors, rather than through ligitimate business activities.
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Friday February 18: v Ireland
Saturday February 19: v Germany
Monday February 21: v Philippines
Tuesday February 22: semi-finals
Thursday February 24: final
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Started: April 2017
Founders: Mostafa Kandil, Ahmed Sabbah and Mahmoud Nouh
Based: Cairo, Egypt
Sector: transport
Size: 450 employees
Investment: approximately $80 million
Investors include: Dubai’s Beco Capital, US’s Endeavor Catalyst, China’s MSA, Egypt’s Sawari Ventures, Sweden’s Vostok New Ventures, Property Finder CEO Michael Lahyani
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Born: Kuwait in 1986
Family: She is the youngest of seven siblings
Time in the UAE: 10 years
Hobbies: audiobooks and fitness: she works out every day, enjoying kickboxing and basketball
Heavily-sugared soft drinks slip through the tax net
Some popular drinks with high levels of sugar and caffeine have slipped through the fizz drink tax loophole, as they are not carbonated or classed as an energy drink.
Arizona Iced Tea with lemon is one of those beverages, with one 240 millilitre serving offering up 23 grams of sugar - about six teaspoons.
A 680ml can of Arizona Iced Tea costs just Dh6.
Most sports drinks sold in supermarkets were found to contain, on average, five teaspoons of sugar in a 500ml bottle.
Roger Federer's record at Wimbledon
Roger Federer's record at Wimbledon
1999 - 1st round
2000 - 1st round
2001 - Quarter-finalist
2002 - 1st round
2003 - Winner
2004 - Winner
2005 - Winner
2006 - Winner
2007 - Winner
2008 - Finalist
2009 - Winner
2010 - Quarter-finalist
2011 - Quarter-finalist
2012 - Winner
2013 - 2nd round
2014 - Finalist
2015 - Finalist
2016 - Semi-finalist
The burning issue
The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE.
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More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
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Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
German intelligence warnings
- 2002: "Hezbollah supporters feared becoming a target of security services because of the effects of [9/11] ... discussions on Hezbollah policy moved from mosques into smaller circles in private homes." Supporters in Germany: 800
- 2013: "Financial and logistical support from Germany for Hezbollah in Lebanon supports the armed struggle against Israel ... Hezbollah supporters in Germany hold back from actions that would gain publicity." Supporters in Germany: 950
- 2023: "It must be reckoned with that Hezbollah will continue to plan terrorist actions outside the Middle East against Israel or Israeli interests." Supporters in Germany: 1,250
Source: Federal Office for the Protection of the Constitution
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If you go
The flights
Etihad (etihad.com) flies from Abu Dhabi to Luang Prabang via Bangkok, with a return flight from Chiang Rai via Bangkok for about Dh3,000, including taxes. Emirates and Thai Airways cover the same route, also via Bangkok in both directions, from about Dh2,700.
The cruise
The Gypsy by Mekong Kingdoms has two cruising options: a three-night, four-day trip upstream cruise or a two-night, three-day downstream journey, from US$5,940 (Dh21,814), including meals, selected drinks, excursions and transfers.
The hotels
Accommodation is available in Luang Prabang at the Avani, from $290 (Dh1,065) per night, and at Anantara Golden Triangle Elephant Camp and Resort from $1,080 (Dh3,967) per night, including meals, an activity and transfers.
MATCH INFO
Manchester United 1 (Greenwood 77')
Everton 1 (Lindelof 36' og)
India squads
Test squad against Afghanistan: Rahane (c), Dhawan, Vijay, Rahul, Pujara, Karun, Saha, Ashwin, Jadeja, Kuldeep, Umesh, Shami, Pandya, Ishant, Thakur.
T20 squad against Ireland and England: Kohli (c), Dhawan, Rohit, Rahul, Raina, Pandey, Dhoni, Karthik, Chahal, Kuldeep, Sundar, Bhuvneshwar, Bumrah, Pandya, Kaul, Umesh.
ODI squad against England: Kohli (c), Dhawan, Rohit, Rahul, Shreyas, Rayudu, Dhoni, Karthik, Chahal, Kuldeep, Sundar, Bhuvneshwar, Bumrah, Pandya, Kaul, Umesh
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