Preview:

As a pilot, you’ve spent countless hours navigating the skies and ensuring the safety of your passengers. But when it comes to navigating your retirement, there are often more questions than answers. In this episode, Ryan answers a critical question from a listener about flying until 65 or whether there is flexibility to retire earlier.

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More About This Episode:

Join us as we discuss the benefits of “practicing retirement,” the impact of healthcare costs, and the evolving landscape of Social Security. There’s a lot to think about when you reach retirement and questions like these are essential for planning.

 

Here’s what we cover in this episode:

0:00 – Intro

0:28 – Practice retirement.

2:21 – Social Security.

4:13 – Planning for the unexpected.

5:31 – Taking the first step.

 

Resources:

Check out the Wealth Warehouse YouTube channel: https://www.youtube.com/@Thewealthwarehousepodcast

Retire Pilots – https://retirepilots.com

Get your FREE Retirement Toolkit – https://bit.ly/3ZmZsaX

Pilot Tax – https://pilot-tax.com/

The Pilot’s Advisor Podcast is also on video. Watch & Subscribe on YouTube: https://bit.ly/3EIEBW2

Connect with Pilot-Tax: https://pilot-tax.com/

 

Episode Transcription:

(Note, this is an automated transcription. Please forgive any errors.)

Walter Storholt  00:04

Hey, on today’s edition of the pilot’s advisor, we’ve got a great viewer question from Dwayne. And Dwayne says from the cockpit, I’ve always heard it’s best to keep flying until 65 before retiring and claiming Social Security at 57 the thought of another eight, nine years at the controls seems pretty daunting. How critical is it to stay in that pilot seat until 65

 

Ryan Fleming  00:27

Well, I think this opens up a lot of different questions. First of all, airline pilots have a beautiful situation where, if you’re tired and you want you know you’re going down that line to retire, we can pull the throttles back and practice retirement. That’s the first thing I would say. There’s a lot of airline guys that want to want to retire at 60 but then they start seeing how much health care is going to cost to bridge the gap, you know, to 65 and it’s daunting, but you could stay on and fly less and still keep that job going. So I tell most of my clients that practice retirement First, your spouse doesn’t like you that much anyway. You can’t, all of a sudden, you know, show up full time when you’ve been gone half the month for the last 25 years. So ease into that first, keep your health care still working on your four 1k and that’s going to be a good, good situation that that airline pilots have, that other careers don’t Okay. So that’s first thing I’d say. So

 

Walter Storholt  01:20

many careers, Ron, you’ve got to just have that official date and employers can’t accommodate you going to transition into part time. But you’re right. That’s got to be something pretty unique about the pilot world, where you can pretty much do that in a lot of

 

Ryan Fleming  01:34

cases well. And it’s actually amazing, because there’s a lot of pilots I know that just, you know, said, Hey, I’m burnt out, I’m done. And then a couple months later, they’re like, that was a mistake, you know? You get that first month or two off, and you’re like, Oh, this is so great. I’m not out on the road anymore. And then next thing, you know, you’re like, I wish I could go on a trip, you know? Yeah, so, so having the career where you can practice retirement, I think, is an amazing thing. Take advantage of it. Take some time off, and it’ll tell you if you’re truly ready for retirement or just maybe not ready for full retirement. And that doesn’t even take into account the other the added benefits of still having that company put B fund contributions into your into your 401, K and having health care that are going to reduce your costs that you’re going to have in in retirement. But the other part of that question, and I’m sorry, what was his name? Was it Dwayne? That

 

02:24

was Dwayne? Yeah.

 

Ryan Fleming  02:25

So Dwayne, you’re asking about Social Security. And I think this conversation’s drastically changed over the years. It used to be that I’d say, hey, Dwayne, when are you going to when are you going to die? And based off of when you’re going to die, we could make an easy calculation of what was the best option for you, yeah, but it’s but it’s really changed now. And how it’s changed is, I think social security is not going to go away, but I think it’s going to be reduced, and it may even be means tested. So what’s what’s changing with a lot of our pilots that retire, they’re taking it at full retirement age, they’re taking it early, and they’re trying to take what they what they can while they can, because I think almost everyone agrees that it’s probably going to be reduced or means tested, so that that’s the change that I see. And of course, that’s less income that you’re taking off of your 401, K to live off of. And so in what I’m starting to see is people are being a little bit more aggressive of taking that early. What do you see Walter? What do you think with this social security issue, that that’s out there where we have to make a bunch of assumptions because there’s a lot of unknowns, and I think the one thing that people do agree on is that it’s going to be reduced.

 

Walter Storholt  03:33

I think you’re the thing that strikes me in your answer is that there is an opportunity to look at the positive of, okay, I may have a reduced benefit if I take it early, but I’m not going to have to withdraw from other accounts as much. And so what opportunity does that create, being able to stay in the market longer, and those kinds of things. So I like how you’re viewing those trade offs, where a lot of people just look at, you know, the first part of that equation, and don’t think about the benefits of doing so, but vice versa as well, right? Oh, I’ll have to start drawing my income earlier if I wait to take Social Security, and I won’t be able to offset it. So I don’t know. I think it’s just important to be talking about those trade offs with folks that people overlook that a lot of the time,

 

Ryan Fleming  04:13

well, exactly. And if we knew exactly when you were going to die, then it’s easy, right, right? But there’s always that break even analysis that

 

Walter Storholt  04:19

you wouldn’t need you Ryan, there would be just a normal formula that we plug in that death date, and it would just spit out exactly what to do. But well,

 

Ryan Fleming  04:26

and that’s people plan their lives on, you know, earning a full income and no medical issues, and, yeah, and that’s just not the way life happens. So I do try to bring up that, you know, this is, this is how, how life goes. And you might be out for a month or two on medical or, I mean, unfortunately, accidents happen. I just just heard today they were changing a tire at Atlantis Airport. The tire exploded, and two, two of the maintenance workers are dead. And, you know, it’s just horrible, like I’ve been actually thinking about that. Since we were you started the podcast and and that’s life. I mean, bad things happen, and so being prepared and protecting your your loved ones in case something happens is something that I think about very, very often. And one of the biggest holes I see in a lot of people’s plans is if something happens to that airline spouse, or, excuse me, that airline pilot, they’re not in a good spot. That’s the biggest hole where, hey, you’re living this lifestyle right now. Well, what if something happened to you? And in most cases, they’re very underinsured. Yeah. Great

 

Walter Storholt  05:30

points, Ryan. Last question for you here for Dwayne or anybody in a similar situation. So let’s say there is a pilot. They’re in their late 50s. They’re thinking they’re gonna they’re assuming they’re gonna have to work until 65 or that that’s the best course of action, but they’re really feeling that draw to try and exit a little bit sooner, whether it’s taking Social Security at 62 and backing out then, or maybe even earlier. What’s the best first step for people in that mindset to take?

 

Ryan Fleming  05:55

Well, you got to start looking at the whole picture, and that’s probably going to be working with a financial advisor that can actually project what your retirement is going to look like, you know. And of course, we have to make some assumptions there, but it’s going to be some some program that they have access to, where we’re looking at assumptions on what’s the rate of return on your assets going forward, when that’s going to stop, what the inflation rate is, what tax bracket you’re going to be in. And then we run Monty Monte Carlo simulations, you know, 10,000 20,000 different simulations of all the different things that could could happen in the market. And this is where I think it’d be so overwhelming to be a do it yourselfer, yeah, you know, like they know that they have to save for retirement, but that distribution phase has so many different variables that that 99 out of 10 pilots. I think that’s what Coach used to say, 99 times out of 10. So 99 times, 99 out of 10. Haven’t even thought about, haven’t even know, didn’t even know that was a variable out there. And it goes back to the old saying, You don’t know what you don’t know, right? And you know the type a pilot, Yeah, you’re good at your job, but I think you might want to work with an advisor and get yourself planned out to be in a much better position for retirement. Well, don’t forget

 

Walter Storholt  07:07

to like and subscribe this video if you found it helpful. Ryan is the pilot’s advisor. He’s helping pilots each and every day get to and through retirement, answering key questions, working with them to set up a solid retirement plan. If you’d like to engage learn a little bit more here is really the one step that you need to take. It is to go to retirepilots.com and download order the free retirement toolkit packed with guides, information, research and helpful resources to help you learn a little bit more about what it’s going to take to retire successfully, and then you can take the conversation with Ryan from there, but that’s the great first step that everybody takes. Go to retirepilots.com and order that free retirement toolkit, Ryan, thanks for answering Dwayne’s question. We’ll catch up with you on the next video.

 

Ryan Fleming  07:51

Everybody fly safe.

 

Walter Storholt  07:56

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