Case Studies

Case Study 1: Do I Have Enough Money to Retire?

The above question is one that I often encounter. Below is a hypothetical example of how I would address it.


Dan, I am tired of my job. When can I retire? Do I have enough money to last my life. And I want to celebrate with a $25,000 cruise.

Gathering Information:

The first things I do is interview them and gather some information. That information is below.

The client (Mr. Case Study) is 62 years old and has a spouse that is 61 years old.

  1. His health is good; all four parents lived to their mid-80s.
  2. His company 401k is $450,000. There is $250,000 in investable savings.
  3. His annual Income is $75,000. His spouse’s annual income is $25,000.
  4. Social Security at full retirement age will be $2,500 per month.
  5. The only debt is the house at $1,500 per month; $100,000 remaining on the principle.
  6. Living expenses excluding house are $50,000 per year.
  7. He’s risk intolerant.

My Response:

Dear Mr. Case Study,

It is possible for you to retire now but we need to have a serious discussion to make that happen. You’re very healthy and your parents lived a long time so I have to assume you’re going to as well. That means your money has to last you a long time. Given your health and parents and a cushion, I am using 90 years old as your life expectancy. I am going to assume 3% inflation. If you both retire at 62 years old and achieve a 5% investment rate of return, you will be out of money excluding your home at about 81 years old. Including your equity in your home will delay the failure point only a few years, but is a mistake as you have to live somewhere and I have not factored in assisted care costs.

In order for you to retire this year, we need to achieve a long term investment rate of return at 7%. That return represents more risk than you stated in the initial interview. The portfolio that achieved this return over the last 12 years, went down 1/3 in the 2008 crash. While the portfolio rose enough later to more than make up for it (far higher than the pre-2008 maximum); 2008 was very scary due to that decline. So we either have to delay your retirement or increase your risk. If we delay retirement by one year, we can assume 6% return and have the money last until 90. 6% represents much lower risk than 7%. If we increase your risk, you can retire now, but it’ll expose you more to the fluctuations of the stock market.

Those price fluctuations can be very scary. A portfolio is like a ship. Every ship captain can choose to take a longer path through calm waters or a shorter path through a raging storm. Both paths lead to the same place, but the stormy path will get you there faster if you can tolerate the waves throwing the ship side to side. The higher the risk, the higher the return over time, but there is a higher chance that at any given moment you won’t have enough money to live the life you want. You have to decide what the best path is for you. In this simile you’re the captain; I’m merely the navigator. My job is to make sure you get to your destination safely.

Case Study 2: End of Life Planning


Cindy (a made up name) is 70 years old. Her husband is dying and has a few weeks left.  He is still coherent. There are a number of stock accounts scattered among different brokers, a life insurance policy, and pensions for each of them.


Dan, what should I do?

My Response:

Cindy, you have a couple things you have to take care of before your husband passes. Most things can wait.

Step 1:

You do not know where everything is. Talk to your husband. Ask where the important papers are. You need to know where the life insurance contract and brokerage statements are. Pull the paper work together if it is all over. If you are not strong enough, have a family member or best friend help you. Look at the beneficiary designation on the life insurance, IRA, and 401K. Make sure you are listed and not his first wife from 25 years ago when he first got the policy. He may have forgotten to change it. If you are not listed, you will need to get a beneficiary change form for the policy or account and have your husband sign it. Every company will have their own form.

Step 2:

The next step would be to make up a list of what you have and what you owe. Show it to your husband. Ask if it right. He will not be offended. You are his partner and he wants what is best for you.

Step 3:

Now take care of yourself. Make sure you eat. Try to keep yourself on a schedule.

Step 4:

After he goes, you will need at least 5 to 7 death certificates. Every account will need one. The funeral home will likely notify social security but call them just in case.


A very sincere sounding sales person will call within days to try to talk you into an annuity. When my father passed, my mother started getting calls within two days. You do not make ANY financial decisions for months. There is no deal that has to be right away. I have personally seen insurance salesman testify at open casket funerals. They go to the widow within days and say they are sorry but the deal is so good it cannot wait (actual experience of mine and the widow went for it and bought $300,000 of annuities). While your head is cloudy, everybody will want a piece. DO NOT SIGN ANYTHING. Even the bank will try to sell you. Tellers get commission.

Step 5:

The next step is to fill out the various paperwork to move everything into your name. IRA’s and 401k’s will need to be rolled over into your IRA. There will be a death claim for the life insurance. The life insurance company will attempt to get you to buy an annuity. You want a cash distribution. They will not write you a check. Instead they will send you a checkbook. So, write yourself a check for the entire balance. Put it in your bank account. Politely brush off the teller who wants you to talk to one of the bank’s financial planners.

Final Notes:

Absolutely do not transfer money to family members. Absolutely do not pay off the mortgage. We may do those things later but first we need to put together your total picture.

Fee Structure

Rate Assets Under Management
1.44% Below $125,000
1.00% Between $125,000 and $750,000
.85% Between $750,000 and $1,250,000
.80% Between $1,250,000 and $1,750,000
.75% Between $1,750,000 and $2,500,000
.70% Between $2,500,000 and $3,250,000
.65% Between $3,250,000 and $4,250,000
.60% Above $4,250,000

A single rate is applied to the entire account. So a person with a $750,000.01 account pays less than a person with a $750,000 account. I will waive personal tax return fees for accounts over $1 million. For accounts that are above $5,250,000, we’ll need to discuss a custom rate.

Please call now at (503) 363-1550 or e-mail me at to find out more about how I can help you. You can also contact me through Facebook, LinkedIn, Twitter and Youtube. If you have a specific question, please send it to me through Facebook. I answer questions there all the time. I’m always happy to help.

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