7 Signs You’re Going To Retire Comfortably

40% of people in this country earning between $300,000 and $500,000 a year say they're still living paycheck to paycheck. $300,000 a year, paycheck to paycheck. So if the way you've been checking whether you're on track is glancing at the people around you, you've been using a broken ruler. And those net worth charts everybody quotes, they're worse because they tell you where you rank and nothing at all about whether you're going to be okay or not. See, Retirement runs on cash flow, not who built the biggest pile. So here are 7 signs you're going to retire comfortably, and every one of them measures you against your own life instead of a stranger's balance sheet. So stay through the last 2 because number 7, believe it or not, has nothing to do with money, and it's the one that most people fail without ever knowing they failed it. This is Building Your Money Machine, where we help you master your money and eliminate financial stress so you can live a life by choice. And I'm your host, Mel Abraham. All right, 7 signs. We're gonna move fast, so grab something to write on because you're gonna wanna know and count how many of these you've already got. 7 signs, let's do this. All right, 7 signs, but I'm gonna tell you upfront, not one of them is a dollar amount because the number sitting in your head isn't what decides whether you retire comfortably. Your cash flow does. Retirement is a cash flow game, and the only question that matters is whether your money produces enough and covers the life that you want to live. 2 people can hold identical assets, pull identical income, and walk into completely different retirements because they want to live different lives, and they'll spend differently to get there. So count with me as we go. Most people that I go through this with have already have 4 of these and have no idea they're closer than they think. So let's start with sign number 1. You know what your life costs and you're living below your means. So let me hand you the cheapest advantage in all of retirement planning. If you can tell me within a couple of hundred bucks what 1 month of being you costs, you're already ahead of the people who outearn you by 6 figures. Not because you're smarter than they are, but because you did 20 minutes of work that they have never once done. There's a survey that Goldman Sachs did, and they went and asked people across every income level whether they're living paycheck to paycheck. Under $50 grand a year, more than half said yes. No shock there. Okay. I, I'm not shocked by that. But people earning between $300,000 and $500,000 a year, right around 4 in 10 said the same thing. 4 in 10, $300 grand a year, and they're living paycheck to paycheck. Sit with that for a moment because those people have a cost problem nobody ever made them measure. Not an income problem. Their lifestyle rose to meet every single raise, and then it reached out for maybe a little bit more. And not once did any of us stop to write down what the whole operation costs. Okay, that's it. And I know, I know guys who can literally recite their fantasy football roster. Their golf handicap and the exact horsepower of a truck that they are never going to buy. But you ask them what their life costs a month and you get a long pause and a number that starts with, eh, probably. So do the work. Pull 3 months of statements, all of it. Mortgage, rent, insurance, groceries, gas, the 4 streaming services, the subscriptions that you forgot that you're paying for, the kids' club soccer, the dog, the dinners out, the stuff that shows up on the card and never registers as a decision. Add it all up, not with judgment, for awareness. Divide by 3. That's the price of being you on a monthly basis. Now, put it next to that number. Put it next to what came in. The space between those 2 numbers is the entire game. Not the market, not your rate of return, not whether you picked the right fund in 2019. The gap. The gap is what becomes the machine. It's the only raw material there is. And if there's no gap, there's nothing to build with, no matter how impressive the top line looks, which is exactly why somebody at $300,000 can be in more trouble than somebody at $90,000. Living below your means is the price of admission to having choices later, not deprivation. Every dollar in that gap is a dollar that goes to work for you instead of you working for it. That's the one, the easy one. You know your cost and you're living under it. Sign 2 is where nearly everybody goes wrong, and it's the one this whole episode turns on. Sign 2 is your number came from your life, not from comparison. All right, you want a benchmark. Everybody wants a benchmark. So let me give you the real ones. There was a Federal Reserve study and it talked about This— the median household net worth in this country, ages 45 to 54, is about $247,000. It's a quarter of a million dollars. Ages 55 to 64 is about $364,000. And keep in mind, a big piece of that is their home equity. So the money actually available to fund a life is a good deal less than the headline. Now go ahead. Find yourself on that list. Yeah. Now throw it out because it can't answer the question you came here to ask. All that number tells you is where you rank. It tells you nothing about whether you're gonna be okay or not. And all those studies don't tell you anything. The person sitting right next to you in your percentile wants a different life than you do and is going to spend differently than you will and might be carrying a health situation you know nothing about. No 2 people are alike, and you can't benchmark your life against a stranger's balance sheet and get an answer that has any meaning to it. So where do most people get their number instead? They take what they earn today and they knock off 20% off of it, because then you're not going to be saving anymore and your lifestyle changes. 80% of your current income. And look, I understand why the industry does this. It's the easiest number in the room to grab. What are you making now? Let's try to match that. It's the number you're living on right now. But follow the logic all the way to the end for a moment. If you build your retirement around what you earn today, you're buying a ticket back into the life that you're living today. And if that life isn't the one you want, you just spent 30 years funding it anyways. This one, this one drives me crazy because it's such a small mistake and it costs people their entire third act, quite frankly. If you've got nothing else to start from, fine, start there. But that's not where you play. When somebody tells me their number, I ask one question. Does that give you the life that you want? And most of the time I get silence. Then some version of, I never, I never really thought about it that way. Never thought about it? About the whole point? So we run it in the right order instead. What's the vision for your life? What are your values? What are the things that actually matter to you? And are those 2 things aligned, your vision and your values? And then we put a price tag on that specific life and back into the number from there. You define the life and then you go get it. Now, let me tell you about a client, Megan. Megan, when she first came to me, she had a number. She'd gotten it the way most people get it, from a calculator and a guess. And that number had nothing to do with the life she wanted with her husband and her daughter. It was just a figure sitting there. So she threw it out and started over. I mean, we built the life first. What does a Tuesday look like? What does a Wednesday look like? How do her weekends look? How much of her is available to her family? What does she want to be able to say yes to without checking anything? Then we priced that life and we ran hers through the wealth priority ladder that I talk about in chapter 12 of my book. So every dollar had a place to go. Here's what happened, and it's the part that I didn't see coming either. See, once the number was tied to a real life instead of an imaginary one, Megan turned out to be closer than she thought. Not further away, closer. Inside of 6 years, she was hitting her number, working 4 hours a day, 4 days a week, with the choice to stop entirely. Sitting on the table in front of her. That number moved because she finally aimed at something that was real, not because the market cooperated. That's sign 2. I want you to bring it from your life. Now I get it, you might say, how do I figure out the cost of my life? Well, it's gonna be estimates. You're gonna estimate, but as you get closer and closer, it's gonna get more and more precise. But I want you to start somewhere. What I'm saying is I don't want you to start with your income. or your current lifestyle. I want you to look and envision the life you want and try to get to the point to build the gap and build to that life so you don't end up at a destination you didn't want. So sign 2, your number came from your life. Quick pause because this part of the episode is sponsored by Gelt. And this one comes straight out of my 30 years as a CPA. I call it the filing gap. You've got someone who does your taxes. They file on time. Nothing's on fire. But you only hear from them in the spring. And by then, every decision that could have changed your tax bill is already made. I've literally watched clients find out in April that one retirement plan set up in December would have kept $20 grand in their pocket, but it's too late. See, filing is a record of what happened. Planning is what changes it. And almost nobody gets the second one. That's where Gelt comes in. They're a tech-enabled tax firm built for business owners and high earners, with a dedicated CPA who works with you All year, runs a projection so you know where you'll land before December 31st, and then helps you make the moves while there's still time. See, the moves that change your 2026 taxes close at year-end. Go to joingelt.com/mel. It's in the description. And get your year-end review started now. Now back to it. Sign 3 is the mechanism. It's the difference between a good intention and an actual Machine. Sign three is every dollar has a job, and the job is automated. So this one quick gut check: Did you invest money this month without thinking about it one time? If the answer is yes, you're running a system, and you're miles ahead of people who outearn you and rely on willpower every single December. So here's the other thing: That same Goldman survey. Turned up something worth chewing on. People who had personalized plans had put more, put more away relative to what they earn. 15% more while they're still working and 27% more once they retired. Same jobs, same paychecks, same opportunities. One group wrote it down and told their money where to go. Let me show you why that works and I'll use my own business To do it. Okay, picture me hiring 20 people. Day 1, everybody's in the conference room and I stand up and, and I say, great to have y'all here. Y'all notice that I do things differently here. No titles, no roles. I haven't written job descriptions for any of you. I'm not even gonna set goals for you, but let's go and double the business this year. And what are the odds that that happens? Yeah, like zero. Not gonna happen. HR is calling the cops before lunch. That's what's gonna happen. That's how most people run their money though. We would never hire, hire a bunch of employees that way, but we are doing it with our money. Nobody gets a title, nobody gets an assignment, and then we act surprised when the dollars wander off somewhere and do whatever they feel like. See, if you don't tell your money what to do, it will tell you, and it picks its moments And usually right when there's a sale on something you don't need. That's the whole reason the Wealth Priority Ladder exists. It hands every dollar its assignment before that dollar ever reaches your hands. Not the leftovers at the end of the month, because there are never leftovers at the end of the month. Investing comes first, 20 to 25% right off the top, and your lifestyle lives on what's left behind. Then you automate the entire thing so it runs on your worst week. And doesn't get raided during your best mood. And on debt, hmm, I'm gonna say this once and keep moving, okay? Because I think it's important. If you're carrying destructive debt, the debt that is financing your lifestyle because you're living beyond your means, you need to pay it off. You need a payoff plan with a real date attached to it. You're either gonna use a snowball method or an avalanche method to get it dialed in. Now, I'm okay with you using credit cards if you want, but do not carry balances, especially at 20%, 24%, 29%. A card you pay off is a tool. Now be careful here because data shows that even when you use a card and pay it off, you will overspend by 20 to 30% because there's no friction in the buying decision. So be careful. A card is a tool and a card you carry is a tenant who never pays rent. And so if you're carrying balances, it's gonna tax you, all right? So we need to start to understand it. Now, if you're sitting there realizing, Well, you never run the real math on what your life costs or what your number needs to be. I built a calculator for you and it's exactly for that. It is the Freedom Number Calculator. And I want you to go to melabraham.com/number, grab it totally free, run some numbers so you start to get an inkling and an idea of where you wanna go. All right, sign number 4. Your plan has been stress tested. A stress tested plan buys you one thing above Everything else. You sleep through a 30% drawdown. You do. Everybody talks about having a written plan, and, and fine, a written plan beats nothing, and a written plan is better than no written plan or something in your head. But a written plan is just a document. A stress-tested plan has already survived the worst year of your life on paper before it ever met one in real life. We're actually testing, saying, what happens if the market drops? What happens if you shorten your working life? What happens If you live longer, what happens if the expenses go up? What happens if inflation goes up? And you test it, test it, test it until you see the probability of success. So that testing really starts to drive things because you start to understand what it does to the numbers, how it plays into it, and you actually get it in a place where you're not some adult that has to move into your kid's house. You do all of it so you stop needing to predict the future. And the clients I work with, when we do this for our clients with the Money Machine Master Plans, they handle the speed bumps really well. And they're not tougher than everyone else. They just have already seen the speed bump before they ever got there. They lived through the exact scenario that was built into it. So when it shows up for real, it just lands like a Tuesday with a decision. That's already been made. And this is where the difference between a pile and a machine shows up in your stomach. If your whole retirement is one big number you're gonna draw down and hope it outlives you, that's a hope and pray strategy, which is not a good strategy. Then every bad year is a threat to your survival. And when your money produces cash flow though, a bad year is just a weather event. That's the game. That's 4. And 4 is where most of this episode on this topic stop. The last 3 are the ones that almost nobody covers, and they're the ones that decide whether any of this is worth building in the first place. So sign number 5, you're building the vibrancy to actually enjoy it. This one is a big one because we don't really think about this, but Fidelity puts out a number every year on what healthcare costs across retirement. This year, it's $185,000 for one person, not a couple. You know, when you look at that, one 65-year-old, you sit back and say, there's $185,000 we gotta deal with. And it doesn't include long-term care and most dental work or anything else over the counter. So there's real exposure that sits above this. Write the number down, put it in the plan, and then let me tell you why that's the less important half of this conversation. Okay. Paying for healthcare and having health are 2 entirely different problems. And people obsess over the first one, paying for healthcare, quietly neglecting the second one. And what's the point of spending 30 years building this thing if by the time you get there, you can't climb the stairs to enjoy it? You did the work, you hit the number, you built the machine, and your body can't cash the check. I'm a CPA. I've spent my entire career on the financial side of the ledger, and there's one account nobody ever puts on the balance sheet. Your body. And your body keeps its own books. It compounds exactly the way money compounds in both directions. It does not issue refunds, quite frankly. So the sign looks like this. You are investing in your body with the same discipline you are investing with your money. It's on the calendar. It's a line item. It covers the boring things, the sleep, the movement, the food, the doctor's appointments that you've been pushing off for 2 years. Money buys almost anything except a decade you spent neglecting yourself. There's no catch-up contribution for that one. We need to take care of ourselves. We need to have the vibrancy and the health to enjoy the wealth. And too often we neglect it in the chasing of the wealth. 5, you're building the capacity to use what you're building. But number 6 asks whether you ever let yourself enjoy any of it in the first place. Sign number 6, You know your joy points and you're funding them right now. This sign comes with permission attached, so listen really closely here. You should be spending your money on the things that make your life feel rich right now while you're on the way to the number, not after you get there. Now. And there's a hard reason for that, and I watch it constantly. Somebody spends 30 years training and saving and training the savings muscle. They accumulate, they invest, they defer, they repeat, and they, they get really good at it. Then they hit their number and they physically cannot spend a dollar without flinching because they've never trained themselves to enjoy the wealth that they're creating. They've got all the money and zero ability to use it because they trained one muscle for 3 decades and never trained the other one at all. Now, I'm not saying to be frivolous and as you're building, just spend, spend, spend, spend, spend. You still have to have a plan. You still have to have discipline, but you can't spend 30 years teaching yourself that spending is the enemy and then expect to flip the switch at 65, Because a spreadsheet says you're cleared. So when we build a plan with a client, we name 3 or 4 joy points, the things that create real visceral joy, the kind that stays with you for a while, not momentary pleasures. And we build them into a plan as line items with actual dollar amounts behind them and part of the plan, not as a reward for finishing it. Joy points that, that get defined by meaning, by values, by what matters to you, not by the price. Painting is a joy point. Hiking is a joy point. Dancing and standing. Sunday dinners. A trip with your daughter or your son where you don't check email once. It doesn't have to be expensive to count. It just has to matter to count. Now, the guardrail stays on here because it's important. The math still has to work. This is an intentional allocation to the reason you're doing any of this in the first place. But it is not a hall pass for debt or overspending that you can't cover, to getting beyond your means. Okay? And I've watched people white-knuckle their way all the way to financial freedom and then arrive completely unable to enjoy it. Like training 2 years for a marathon and then refusing to stop running. That's it. You made it. Sit down. See, people who never train for joy on the journey don't suddenly discover it at the destination. That's 6. Now the last one. Now, if I could only check one of these 7, well, this is the one I would check. Sign 7 is you know what you're retiring to. Answer this one out loud in your car, in your kitchen, wherever you happen to be right now. What are you going to do? Not what are you going to stop doing? Everybody can answer that part. That's the easy part. Ask somebody what they're retiring from. And you get a 20-minute answer with names in it, like grievances, specifics, the whole file. It's all there. But ask that same person what they're retiring to and you get travel, I guess, maybe golf, maybe, you know, card playing. I don't know. See, that gap right there is the most expensive one in this entire episode and it has nothing to do with money. And I've watched this play out over and over and over again. Someone spends 30, 40 years with their identity welded to their work. The profession, the practice, the business, the title on the card, and the way people's faces change when they hear what they do, as if that's actually who they are. And every person in their life reinforces it every single day. Then the gold watch comes, the work stops, and they go home. 2 months on the golf course, a few weeks at the racquetball club or the pickleball court, and then the bottom quietly drops out and they're restless. They're bored and completely lost. They didn't run out of money. They ran out of reason to get up. Nobody warned them because the whole culture sold them this finish line when what they needed was just a doorway, a different doorway. That's why I look at retirement as a transition into other things rather than a stopping point. Nobody hands you a gold watch and a television set and calls that a life. You're moving towards something that matters to you. Something that uses what you spent a lifetime building and means something to somebody other than you. So do this, and fair warning, it's harder than the math. Name 3 people: one from your history or from fiction, the hero you wish you had the guts to be; one from your real life, somebody whose daily energy you deeply respect and the person you watch and think, yeah, that's how I want to move through a day; And one more, the older version of you sitting across from you, looking back at you that exists right now. Then ask what single quality all 3 of them are begging you to lean into. That's the thread. That's the thing that you're retiring to. And I'd bet money you're already carrying it. You just have never named it out loud. That's the thing. Because the money machine will fund a life. It will not invent one for you. You have to do it yourself. You have to build it yourself, and it needs to be your life. So let me leave you with the thing that took me the longest to understand, and I paid a high price for this lesson. We've all heard that we get a limited number of days, and I heard it all my life, and I nodded along the way everybody nods along when someone says that, and it seems true, and I had no intention of doing anything about it. Then I heard 3 words. You have cancer. And all of a sudden, my own mortality walked across the room and sat down in front of me. And it turns out it had been true the entire time. I had limited number of days and nobody was ever going to tell me the count. People ask me how cancer changed me, and it made it easier for me to say no, because once you can feel the clock, you stop handing your days to things that don't matter to you. So sit with this for a second. Every one of those 7 signs is a way of buying back time. Now, knowing what your life costs buys you time. Telling every dollar where, where to go buys your time. Building the income that shows up without you buys you time. Taking care of your body that has to live this thing buys you time. And knowing what you're walking towards is what makes the time worth having. Once you get it, that's the whole game. Every dollar you put to work is a dollar converting itself into Tuesday afternoons with the people you love while you're still well enough to enjoy them. And the clock runs whether you decide anything or not. That's the part that gets people. Not deciding is a decision, and it's the one that quietly hands you your third act over to whatever happens to happen. The decade. Doesn't come back. Money has a makeup plan and time has never offered one. So pick one sign. Pick the one that made you shift in your seat while you were watching or listening, because that's the one your gut already flagged. And go do something about it this week. Not in January, not in December, not a New Year's resolution, not when things settle down, because things don't settle down. You've got a life waiting on the other side of this work. And it's a good one and it's yours and it's closer than you think. Go build it because earning more doesn't make you free. A money machine does. All right. I hope that this hits and I hope that you see it and I hope you look at it through those eyes and say, am I ready to retire? Or how do I prepare myself to get ready to retire and make sure that that life is meaningful? All right. I'd love to hear from you on this journey. Let me know what you think. Let me know which one of these hit. And while you're here, Hit the subscribe button and give me a thumbs up. It brings joy to the algorithms, but it also brings joy to my heart. All right, until I get a chance to see you in the next one or on your journey, on your path to financial freedom, always, always strive to live a life that outlives you. See you in the next one. Cheers for now. Cheers.