Early Retirement Resources 2/13/2023

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This month’s resources start with a return to my roots in healthcare. I share resources from a few physicians and therapists to improve your quality of life in retirement. I also share a resource exposing ugly truths about my new industry, financial advice.

Resources will help you navigate a hot start of the year for financial assets. Selected articles will reiterate a few key themes that I’ve written about on the blog as well as sharing a contrarian opinion about FIRE.

Finally, after a quiet year in the world of credit card reward points, I’ll share a few incredible current offers you may want to jump on. Enjoy!

Taking Your Medicine

There is an important parallel I’ve noted between my original career in health care and my encore career in the world of personal finance. All too often we focus on the things that we can’t control and that don’t matter, when very often we ignore big things that we absolutely can control.

Dr. Anthony Ellis highlights the things that give us the best chance of a long healthy retirement, writing Functional Longevity: What Use Is Retirement If You Can’t Move and Think?

Dr. Peter Attia asks if a seemingly healthy behavior done to excess or for unhealthy reasons can become a problem, writing The Dangers of “Healthy” Addictions. This article focuses on exercise addiction, which is rare. However, if you zoom out and focus on the principles discussed, they apply to unhealthy behaviors around money, success, etc. that are probably common in this community.

As we grow and change over time, our relationships can suffer. “Gray divorce” is the term describing the increasing rate of divorce among older couples after long relationships, and often around the time of retirement.

Relationship counselors Kristy Gaisford and Jerry Sander thoughtfully discuss strategies for navigating a relationship where some of your needs are not being met, and knowing when it is time to stop navigating a bad relationship and end it: Relationship Reckoning.

Ugly Truths

As I move to a new position as an advice-only financial adviser, one of my favorite podcasts is Kitces and Carl. The podcast is hosted by industry leaders Michael Kitces and Carl Richards. They give an honest look into the challenges faced by financial advisers.

A recent episode, When A Prospect Doesn’t Meet Your Minimum: Navigating the Awkwardness Gracefully, gives a behind the scenes look at a common challenge faced by many in this industry. Compensation models unfortunately still overwhelmingly focus on selling products and/or helping those who have already accumulated substantial assets.

This episode demonstrates how the latter of these compensation models leave many people behind who would greatly benefit from the help of a financial adviser. The former model is, in my opinion, even worse. It incentivizes selling products which are often not in the client’s best interest.

To be clear, the advice-only model I have long advocated for and recently began working under does not sell anything (aside from advice) and does not have minimums because we do not manage client’s investments. This minimizes the conflicts of interest inherent to all financial advice and avoids this “awkwardness.”

Staying Even Keel

After a rough 2022, the strong market returns in January were a welcome development. But what does it mean moving forward? Jason Zweig reminds us that the only thing it means is that The Year is 8% Complete.

Peter Mallouk and Jonathan Clements consider how to allocate your portfolio as interest rates return to more historically normal levels, Keeping Our Balance.

Sounds Familiar

Clements is one of my favorite financial writers and is always a wise voice. So I found it interesting that his primary considerations for a retirement location, shared in Retire Is a Verb were nearly identical to those I shared a few years ago in Where Should You Retire?

A favorite topic of mine is sharing FIRE principles with a broader audience. I’ve written about how FIRE principles can be used to turbo-charge progress for those behind on saving for retirement. Bill Yount shared a first person account of what that can look like, writing Saving Our Retirement.

In a post last year I highlighted why inflation risk is so damaging to a portfolio and so hard to manage. I wrote: “Once inflation occurs, prices that have increased don’t tend to come back down. The rate of inflation may slow, but prices continue adjusting upward from ever higher levels. Your dollars consistently become less valuable over time.” Lyn Alden shows this phenomenon very clearly in a series of charts.

FIRE Obsolete?

It is no secret that I am a big proponent of FIRE principles. So you may be surprised that I agree with most of the points made in this post from Financial Samurai. He writes Why Early Retirement / FIRE Is Becoming Obsolete.

Pralana 2023 Gold Released

Laws are constantly changing that impact our retirement planning. Any retirement planning tool should reflect these changes.

The Pralana 2023 Gold was recently released. In addition to other upgrades like enhancing the Roth conversion algorithm, updates include implementing:

• The Inflation Reduction Act to extend ACA subsidies through 2025 regardless of MAGI
• SECURE 2.0 to delay RMD’s
• 2023 tax tables

Credit Card Reward Deals

I didn’t write much about credit card bonuses all of last year, because I usually only think about them when we sign up for a new card. We generally do so 4-5 times per year. Last year we only got two new cards because I found the sign-up bonuses underwhelming. That recently changed.

Chase has three personal credit cards affiliated with Southwest Airlines. They are the:

Each of these cards are currently offering a free Companion Pass® through 2/28/2024 plus 30,000 points. To earn the bonus, you must meet the spending requirement of $4,000 on the card in the first three months after opening. The annual fee for each card respectively from top to bottom is $69, $99, and $129.

This deal is extremely rare. I assume it is a way for Southwest to generate some good will after their holiday travel season debacle. Whatever the motivation, if you will be spending enough to quickly earn this bonus and plan on flying Southwest in the next year, jump on this one! 

As an example of the value you can obtain from the Companion Pass® in a year, between April 2022 and 2023, I’ll have flown FREE as Kim’s companion on three cross country round-trips, two trips between SLC to Las Vegas, one between SLC and Phoenix, and one between Las Vegas and Hawaii.

Because Kim’s current Companion Pass is good through the end of 2023, we passed on this offer. Instead, we got a new IHG® Rewards Premier Credit Card. This card is currently offering the ability to earn 175,000 bonus points after spending $3,000 on the card within the first three months of opening the account. This card has a $99 fee.

These cards offer what I consider two of the most attractive of many increased sign-up bonuses currently being offered on travel rewards cards, making this a great time to consider a new card.

As a reminder, if you don’t have specific travel goals in mind and are not familiar with using travel rewards, the Chase Sapphire Preferred® Card and Capital One Venture Rewards Credit Card are always my two favorite cards for beginners. Each currently have an annual fee of $95, offer at least $750 worth of travel rewards if you meet the initial spending requirements, and can be used in flexible ways. I’ve laid out my personal credit card reward strategy here. Happy travels!

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[Chris Mamula used principles of traditional retirement planning, combined with creative lifestyle design, to retire from a career as a physical therapist at age 41. After poor experiences with the financial industry early in his professional life, he educated himself on investing and tax planning. Now he draws on his experience to write about wealth building, DIY investing, financial planning, early retirement, and lifestyle design at Can I Retire Yet? Chris has been featured on MarketWatch, Morningstar, U.S. News & World Report, and Business Insider. He is also the primary author of the book Choose FI: Your Blueprint to Financial Independence. You can reach him at chris@caniretireyet.com.]

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