The hook for this book by Frank Armstrong III and Paul Brown is in the subtitle. Notice it’s not “Save FOR your retirement”. It’s “Save Your Retirement: What do Do if You haven’t Save Enough or If Your Investments Were Devastated” is a book of distilled wisdom compiled by a CFP and professional financial journalist.
It’s really mostly the gloss they put on it as an excuse to write yet another book on a tired subject. Basically, they suggest you not retire if you can’t afford it. Sorry, spoiled it.
But I liked the book overall. I found the structure to be useful, segregated out into different chapters depending on how many years out you were. There were some useful nuggets. As I say, “rules of thumb work pretty well for people with thumbs.”
Although I mostly liked it, I had two quibbles about this book. One was that they starkly say “don’t buy annuities”. Money managers have a HUGE thing against annuities. I really wish people would talk more about the risks and benefits of annuities, because I can think of at least two different scenarios where “definitely buy annuities” would be better advice. Most of the time the correct advice is “consider carefully whether to buy an annuity, because it may be appropriate in your situation and you won’t find out from an annuity salesman.” That means you DO need to find out from books like this, and it totally dropped the ball on it.
The other quibble was that it didn’t really talk about percentages you need to be saving. I’ve seen some really decent scholarship saying that the savings RATE is really super important, more than the amount you’ve got saved at any given moment, in terms of being able to reproduce your desired lifestyle.
That said, it hit some really good moments when it discussed estate planning up front (hello, dying is actually an important aspect of your retirement plan) and it also did a good job of trying to squelch lifestyle inflation after your kids leave home before you retire (the extra money freed up when they leave home is not for ramping up lifestyle, it’s for fixing your beleaguered retirement plan.)
All in all, I’d recommend the book as an easy read with a few good ideas, but I’d pair it with a different book on when and why you’d want to convert your 401(k) into an annuity. I’ll have to let you know when I find that one.
Originally written October 2, 2014 by Wendy Marsden, CPA, CFP®