Key Points:

• Prudence in spending is crucial for extending the longevity of retirement savings.
• Moving to a lower-cost area or tax-friendly state can significantly increase the value of your retirement funds.
• Assess all assets, including home equity, and consider downsizing to maximize financial security in retirement.
• As good as Costco is, it’s not as good as “the Next Nvidia.” Click here now to see what the hype is all about.

Doug and Lee discuss the importance of financial prudence in retirement, particularly for those from a generation raised by individuals who experienced the Great Depression. They emphasize the need to manage expenses wisely, avoid overspending on luxury items, and consider the cost of living when planning for retirement. Moving to states with lower or no state income taxes, like Florida or Texas, is suggested as a way to stretch retirement funds further. They also highlight the potential benefits of selling a home to increase liquidity and downsize, which could enhance financial stability in retirement.

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Edited Video Transcript:

Well, and it’s interesting talking about people that are our age and in a retirement generation.

We were brought up by people that lived through the Depression.

They were very thrifty people because they’d seen firsthand what had happened.

And I think today I read a lot of stories where we make four hundred thousand dollars a year, but I’m living month to month and I’m like, how is that even possible?

You know, what are you spending your money on?

And I think as people get older, they’re a little more prudent in their spending.

And that’s an important thing for making that money last.

Is to be prudent in your spending.

Again, you know, a Rolex tells time just as good as a Timex.

And, you know, a designer wallet holds money just as well as something from, you know, TJ Maxx.

And I think people get too carried away, especially today with luxury items, rather than realizing that, hey, everybody’s in better shape and your lifespan may be longer, so you need to make it last.

So I think part of our advice is, take your expenses and make them as fixed as possible.

Right.

Next one, which people ought to know because of where they live.

Think about your cost of living.

Now, part of that is, is that some people will say, well, I’m going to move from Massachusetts to Mississippi because suddenly your million dollars is worth like one point two million dollars.

It is.

I can tell you from experience your your your buying power goes up.

Yeah.

And the other thing is look at the million dollars along with any other assets you have.

Don’t just look at the million dollars.

If you’ve got other assets like a home, it’s a good time to ask yourself whether or not you want to keep that home or you want to have liquidity in that.

So you’ve got a million and a half dollars.

And for most people, if the home is paid off, you probably won’t go into another home that’s equal to or greater than.

So you will take a tax hit, but it’ll be a long-term gain.

And as long as it’s not taxed in an incredible fashion, you can walk away with some good money where you can A, move to the condo life or move to a retirement community where everything is included.

You know, and, and, and downsize.

And that’s a good idea.

And also consider the state you live in states like Florida and Texas don’t have state income tax.

And in many places, like probably where you are, Doug, in Connecticut and New York and places like that, it’s incredibly onerous.

Yeah, it is.

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