6 BIG Purchases Retirees (Almost) Always Regret!

in this video we discuss six retirement purchases that retirees almost always regret coming up next on holy schmidt holy schmidt in my video the seven most important things that every retiree should own outline seven purchases that every retiree should consider strongly to own in their everyday life i'll put a link at the end so that you can see that video it's one of my most popular videos by the way this video is the opposite of that this video outlines the things that retirees shouldn't own or at the very least should consider strongly before they purchase and most don't let me begin by talking about something that happened to me recently which is the genesis of this video in fact i'm sure that this has happened to most of you you're vacationing down in florida out in arizona or up in maine and you're at a restaurant and run into somebody from work that you have not seen in years he was older than you and has long since retired and as you looked at him you noticed something was very very different when he worked with you he was a man that was pretty average like many people hard-working kind of invisible in some circumstances and very visible in the ones that mattered most he didn't overdress drove an average car and ate in the lunch room at the office or the factory he seemed happy enough and when it was his time to go he had a party and gathered his closest friends he invited you because you worked together side by side for 20 plus years and it would only be appropriate since you enjoyed his company and he enjoyed yours that you were at his going away party fast forward five years later you're at a restaurant a thousand miles away and you have this weird disassociative experience you know the one i'm talking about the one where you knew someone really really well but only in a very specific environment and you're not in that environment then you see him or her in a completely different environment and you can't remember how you know them despite the fact that you worked for 20 years together and saw them every single day he walks up to you and says it is really good to see you it's been way too long you look at him desperately trying to remember his name and where you know him from and then it comes to you with a boom wow that's jack from the plant he looks great you think retirement looks like it's been great to him and it looks a lot different a lot healthier he doesn't have a 10 haircut anymore he has one that looks like it was groomed at one of the big high fashion hair salons a little longer and maybe a little bit darker than when he left the plant he was wearing a blue blazer a pair of nice jeans and a white linen shirt at the restaurant all you ever saw him at at the plant was a pair of dungaree pants and a blue work shirt to be fair he was at a restaurant and he wasn't dressed too differently than the others the blazer might have been a bit much it was warm out but he didn't look out of place except for one thing he had a white pocket square perhaps he decided he wanted a little bit of style in his life you thought you chatted for a few minutes both realized you were finishing up and he called for his check you noticed that he pulled out an american express platinum card and he made a mental note that that was a 695 a year card and also commented on it he smiled proudly to show you his card and paid his bill and you both walked out you get to the parking lot you get to your rent-a-car because you are on vacation and he gets to his tesla model s you think that's a hundred thousand dollar car and he noticed you noticing his car he smiles and gives you an acknowledgment that he has somehow made it he gets in his car and he drives away fast forward a few years you're talking to a friend and jack's name comes up again the friend says it's really sad what happened to jack and you say what happened to jack your friend proceeds to tell you that he lost all his money he spent all of his money and he is now living with his son unfortunately this story is all too familiar someone scrimps and saves for over 40 years and when they get into retirement this is their time to enjoy what they couldn't have for 40 years so they go overboard this list six purchases that retirees almost always regret is a very powerful list and it contains some of the most common purchases that retirees make but it's not all inclusive if there's one that you want to add to the list please put in the comments section below so that others can learn from your experience as always i'll remind you again at the end number one on the list is a really expensive car everybody has an achilles heel and for a lot of people that achilles heel is an expensive car they're easy to spot because their entire adult life at least a major portion of their entire adult life they have the most expensive car in the parking lot and they carry that with them into retirement but in retirement there's no need to impress customers or the boss or bosses anymore and so retirees swap out bling for comfort and safety in their automobile choices so if you find yourself looking at and considering a car that will make your heart race give it a second thought and then give it a third thought believe me when i tell you after you buy that car you're committed to it for at least the life of the lease or the car payments and if you still feel like you need to buy it wait 24 hours the car probably isn't going anywhere it really isn't the last day of the sale and if it is another sale is right behind it point number two is buying a bigger house when you retire now traditionally when people retire they downsize however often people move from one state to the next and the cost of living in the new state is lower when that happens the house may indeed be less expensive even far less expensive so there's a big temptation to get the bigger house that they couldn't afford when they lived up north or out west but even if the house is less expensive even far less expensive bigger houses come with bigger expenses electricity powers air conditioners and lights and if you're moving to the south particularly a place like florida or texas or somewhere in that direction the cost of electricity and the use of air conditioners goes way up you need gas to heat the house in the winter time usually or at least a larger electric bill taxes could be bigger depending on the school system and the area in which you live an upkeep won't be vastly different no matter where you live because upkeep is based on the size of the house and the condition of the house the next point is big travel experiences people dream of the day when they can retire and go on the never ending vacation as it's often referred to many people have pictures of exotic islands cities in italy or france that are thousands of years old or the mountain hideaway in switzerland where they're going to spend a month or two or three skiing when they reach the time where they're retiring if you can afford it by all means don't deprive yourself of that bucket list vacation but when it becomes more than one and you're doing it every year that has a tendency to deplete your savings very very quickly also even if you're going to take one vacation be smart about it and plan well in advance make sure that you travel during off days like a tuesday or wednesday and consider staying at a boutique hotel a nice boutique hotel rather than a mega resort a five store mega resort next point is giving expensive gifts when you go into retirement you have a lot of time to think about life and think about your families and retirees love to give presents that make their kids and their grandkids smile it seems like the price is worth it and it might be at that time but if you continue to give and it starts to become an expectation what used to be a great idea now becomes a sieve when it comes to your retirement savings also when you're in retirement gifts add up even small ones there's a big difference by the way between giving someone a set of travel headphones for the plane and buying them a trip to europe and back most importantly the best things in life really are free what you're looking for is the connection that you and the recipient get when you give them the gift not the act of spending itself so look for other ways to develop that connection dinners game night phone calls are often much more impactful for both you and them than giving them a playstation 5 for 900 the next mistake is giving regular cash gifts to your family a good gift gift-giving strategy will help you manage your taxes and will change the game for someone who is receiving that gift financially a bad gift-giving strategy could send you to the poor house giving cash is part of the game when you're a parent in the early years you give the cash and you make most of the decisions on where it goes but if you find yourself paying for major parts of their life long into their adulthood check yourself because you could come up short later in life yourself the last one is a vacation home this is a classic big retirement mistake let me tell you why imagine that you live on the northeast and you want to buy a home out in california in palm springs and you want to live there in the months of december january february and march so four months it seemed like a good idea because if you're going to spend four months out there anyway you might as well own so that the inflation on renting doesn't go up over the next 10 15 20 years plus but and this is really important the math doesn't really support this let me explain why if you owned that home or a home like that and you only live there four months out of the year that means that you're paying for a house that can be occupied for 12 months and only using it one third of the time then on your primary residence you go from using it 100 of the time down to two thirds of the time the wear and tear on your primary home doesn't change you still have to maintain that home you still have to pay taxes on that home and you still have to keep the home heated in the winter time and cooled in the summertime even if you're not there otherwise bad things start to happen to that home the same could be said of the vacation home but in reverse you're only using it four months out of the year but you have to pay taxes on 12 months of use out of the year you have to heat the home and you have to air condition the home even when you're not there but you say jeff i'm just going to rent out the house when i'm not there that's going to recoup some of the costs follow this here for me if you own that home and you live in it during the best time which is december through march in palm springs anyway who's going to want to rent it in the middle of the summer it's not a vacation rental that's a different thing if this is a home that you plan on spending a big portion of your life in when you are not there you won't be able to rent it out at least not economically because the times that you want to be there they want to be there the only time it may become a reasonable investment is at the end when you sell it the points in between definitely not so much and frankly if the cash flow doesn't support it in the middle then the selling price at the end probably isn't going to offset that those are my six and as a reminder if you have some that you think others can benefit from please put them in the comments section below so that they can benefit from your wisdom also check out the video the seven most important things to own in retirement this is jeff schmidt thanks for watching

Channel: Holy Schmidt!

Views: 607,521

Keywords: bad retirement purchase, bad retirement purchases, retirement spending, things not to buy in retirement, why owning a vacation home is bad in retirement, retirement spending, retirement spending plan, retirement spending advice, retirement spending budget, spending money in retirement, what not to buy in retirement, good vs bad spending, how retirees should spend their money, retirement planning, retirement spending strategy, retirement income, retirement spending patterns

Id: LonVdylaa48

Length: 11min 30sec (690 seconds)

Published: Sun Aug 14 2022