Ben Stein’s Day in the Sun

Ben Stein explains how to enjoy retirement, by making sure you have one!

A Day in the Sun

by Ben Stein

It was a perfect sunny summer day in Malibu. I spent a large part of it gardening (which I’m very bad at but enjoy), some of it filing financial statements, and about two hours of it lying in the sun with my dog while listening to Mozart on my headphones.

If I had to, I could, at 61, retire and live quietly for the rest of my life at my little home in Malibu doing what I did today. I don’t want to, because I travel around preaching retirement readiness, and I love doing that. But I could if I wanted to.

Why can I? Because my parents were thrifty, and good planners. And because they bought low-cost variable annuities that paid off like winning the lottery, and bequeathed them to my sister and me.

Also because I’ve been a saver (although not as good of one as I should’ve been) all my life; because I took the trouble to learn at least the basics of investing and then some; because I have two great financial advisers named Phil DeMuth and Kevin Hanley; and because I’m lucky enough to have had a career that paid the bills.

All of that — and, most of all, the greatest of gifts: being an American — allowed me to enjoy this glorious summer’s day.

Plan, Invest, and Save

Here’s how you can get to a similar place in your life (if you’re not already there):

* See a financial planner that you’ve chosen with a microscope. Tell him or her everything.

* Make a plan, and make sure you understand every word of it.

* Have widely diversified investments.

I recommend devoting one-third to a very diversified international fund; one-third to a total stock market index for the U.S.; and one-third to a highly diversified bond fund that tracks the Lehman bond index.
* Put at least 15 percent of your wages into these investments every month, before you buy a plasma-screen TV or a cruise or even your child’s education.

Keep doing it even when the commentators are telling you that the markets are collapsing and the sky is falling.
* Make and keep habits of thrift. Unless you have an income of $1 million or more a year, don’t spend any money you don’t have to.

* Keep in mind that you’re your future, older self’s only dependable and indispensable friend. You’re your own indispensable counselor, too. So you’re the pillar on which your old self will rest — behave respectfully to that older self.

* Carefully consider variable annuities in addition to your investment portfolio, but only when you understand them and know what each fee is for. In your really advanced years, when you no longer have the strength to keep track of things, that automatic check will be a lifesaver.

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