Retirees Sleep Better! (Who Knew?)

It's official. Retirees sleep better that working folks. Gosh! What a surprise.

A recent Finnish study entitled "Effect of Retirement on Sleep Disturbances: the GAZEL Prospective Cohort Study" concluded that retirees sleep a lot better than people who work. You probably suspected that this might the case.

Surely you can imagine the soporific effect of spending the day reading a good book in a hammock as opposed to working like a dog and being chewed out by your boss. But now it's no longer conjecture. The study reported "repeated measurements [that] provide strong evidence for a substantial and sustained decrease in sleep disturbances following retirement." So now it has been proven: retirement equals better sleep. The improvement in sleep was more pronounced in men than in women, but both groups registered significant improvement in sleep.

Need a good night's sleep? Perhaps retirement is for you. Sweet dreams!

Need Help Saving Money? Frugal living can help.

When planning for retirement, or living in retirement, many people need help saving money. Being frugal can help. There's a difference between a someone who is frugal and someone who is a cheapskate or a skinflint. Cheapskates and skinflints tend toward the miserly side of the spectrum. Someone who is frugal, on the other hand, is wise with his or her money. Frugal people enjoy life to the fullest, but they don't pay full price. To get you started on your frugal life, I found this nifty website with 50 tips on frugal living which may be of help to you. I'm doing most of them already (although, I'll admit, I still have a cell phone). See how many of the 50 you can incorporate into your life.

If you need help with retirement planning, including some of my frugal living tips, check out my book, Who Said You Need Millions? Retirement Strategies for the Rest of Us, available at online bookstores.

Need to find out where you stand?

So you are sitting in your office, your cubical or just chillin' in the back room or on the loading dock and thinking about your retirement. Do you have enough money? What about Social Security? You've go a lot of questions. Do you want to get an idea of where you stand in the race to retirement? A retirement planning calculator might help.

When it comes to retirement planning calculators available on the internet, there are a lot to choose from. There are simple calculators like the one available at CNN/Money.com, but sometimes simple is not necessarily better. One calculator I like is called ESPlannerBasic created by Professor Laurance Kotlikoff, Professor of Economics at Boston University. The great thing about ESPlannerBasic is that it's easy to use, free and it allows you to customize the calculations to fit your specific situation.

Too often retirement calculated make assumptions that do not fit your life situation. As a result, the conclusions that the retirement calculator reach will probably be inaccurate. Not so with ESPlannerBasic. Try it and see for youself.

Note that Professor Kotlikoff offers two even more detailed calculators called ESPlannerPlus and ESPlannerPro if you want to pay for them. I haven't tried these versions but I would expect them to be even more accurate than ESPlannerBasic, since they allow you to customize the results even further. Good luck with your planning.

Check Out Our New Facebook Page

Not to be left behind, I too am joining the facebook and twitter generation. Find the new facebook page at: http://www.facebook.com/home.php?ref=home#/pages/Who-Said-You-Need-Millions-Retirement-Strategies-for-the-Rest-of-Us/148380866130?ref=nf

Check out the discussion board on the page and participate. Today's topic is "Why is There So Much Bad News About Retirement?" You see, I get a daily RSS feed about news articles written about retirement issues and all the news seems to be bad. However, the people I know who are retired are having the time of their lives. Why, I wonder, is there such a disconnect? If you have something positive to report about retirement please participate in the discussion.

For example here's some good news I posted: When our economic system was collapsing last year and early this year I sought advice from my 88 year old father who said, wisely, don't worry son, things will improve, they always do. And, he was right. Almost a year later things do seem to be improving. Additionally, like everyone else, I cut back my spending in response to the crisis and learned that I can even live happily on less money than I had predicted when I retired. Now that is good news. Living on less doesn't mean I'm a cheapskate and it doesn't mean that I'm depriving myself of things that I really need. But it does mean that I have to spend a little time getting the best value for my buck which I have turned into sort of a game. Recently, I spent some time getting insurance quotes (home, car, umbrella etc.). When you're working, who has time to do that? Turns out I saved $800 bucks a year for my efforts. Not bad eh?

P.S. What does the picture have to do with this topic? Nothing. My wife and I recently went on a two and one half month motor home trip (retired people can do that you know!). One of the stops was Arches National Park in Utah. While I am loathe to use the current vernacular, it was truly awesome.

Stress Test Your Retirement Plan

Many people have opened their 401(k) and/or other retirement savings account statements and found that they have lost a significant percentage of their retirement nest egg. I've experienced the same thing and friends who are still working often ask me, usually with a tinge of schadenfreude in their voice, "so (smarty pants), when are you going back to work?" Not yet, I tell them. Here's why.

In the course of every retirement, there are going to be economic downturns. True, the current downturn is the worst since the great depression. But it's just another economic downturn. During a 30 to 40 year retirement, you're bound to experience a few of them. Perhaps the silver lining that can be found in this doozy of a downturn is that if your retirement plan can survive it (without you going back to work or living out of your car and eating only beans and rice cooked over Sterno®), it can probably survive anything. In that way, like what the Federal Reserve Bank is doing for the nations top banks, this downturn is sort of a "stress test" for your retirement plan.

But, without risking the chance that you'll completely running out of money in a few years, how can you really determine where your retirement plan stands? One approach might to do an actual stress test of your plan again using a realistic retirement calculator.

One calculator I like is called ESPlannerBasic. ESPlannerBasic a comprehensive retirement planning software program developed by Laurence Kotlikoff, a professor of economics at Boston University. One great thing about the software is that it's available on the Internet for free. A more robust version of the software is also available for a fee.

The software "calculates how much you should spend, save, and insure each year to achieve a stable living standard." Those who are already retired can use the software to test their current levels of spending to see if their retirement plan is still viable. If your plan doesn't pass the test, you'll know exactly how much you'll need to cut. Those on the verge of retirement can use the software to see whether or not now is the time to take the plunge.

I've stress tested my retirement plan using Kotlikoff's ESPlannerBasic and have learned a few things about my retirement plan. First, I've learned that, despite the setbacks caused by the recent financial crisis, my retirement plan is still viable, as long as I keep my spending under strict control. Whew! Second, the stress test results provided by ESPlannerBasic reinforced what I already know and that is that controlling the expenditure side of the retirement plan ledger is the key to a successful retirement.

ESPlannerBasic has a few flaws, for example it assumes that you will live to 100 years old (you have a less that 1% chance) and doesn't allow you to tap the equity in your home for your support. However, the software is a good basic tool for making stress test estimates.