By FPA member Joseph R. Hearn
Last Updated: May 14, 2012
There is perhaps no more revered institution in America than that of Sport. Baseball is our national pastime. The Super Bowl is our most watched television program. Popular franchises have billion dollar price tags. Phrases like “The Miracle on Ice” and “The Dream Team” still illicit emotion decades after the games that spawned them. Our heroes are people like Jordan, Ali, DiMaggio and Armstrong. Go to the most remote nation on earth and you will likely find many people who can’t name our President, but they can recognize a picture of Tiger Woods or LeBron James.
Why are people so drawn to sport? Is it the passion of the players? The thrill of victory? The hometown pride in the team? Those are all good reasons, but I think somewhere near the top of the list would have to be the life lessons we can draw from organized competition. Whether it’s little league or major league, there are things we can all learn from games and the players who play them.
That is probably why I recently found myself wondering, as I watched fans yell advice to Tiger at the tee box, what advice he would have for us if the tables were turned. Since my beat is retirement, I pondered what wisdom guys like Tiger, Tebow and Tyson would have for those planning their golden years.
Tiger Woods (Have a plan)
In Hank Haney’s new book The Big Miss, Tiger’s former coach reveals that he always played his best golf when he had a plan for improvement, structured practice sessions and a clear goal that it was all pointing to. If Tiger were to look at how most of us are preparing for retirement he would probably ask, “What’s the plan?” How much do you need to save? Where will you live? What are you going to do? Our plan should answer all those questions and should be a step-by-step guide to get us from where we are to where we want to be.
Coach John Wooden (The importance of team)
John Wooden was the first person to be inducted into the basketball hall of fame as both a player and a coach. As great as his talents were, he understood the importance of team. A favorite saying of his was, “The main ingredient to stardom is the rest of the team.” Are you going it alone with your retirement planning or do you have a team? Partnering with trained professionals like a financial planner, estate-planning attorney, and accountant, can bring a level of expertise and discipline to your planning that greatly increases your odds of success.
Andy Murray (Focus on fundamentals)
Andy Murray is a great tennis player. Unfortunately, he hasn’t won a major yet because he happens to be playing the game at a time when it is dominated by three of the greatest players to ever pick up a racquet: Federer, Nadal, and Djokovic. To rise to the challenge, he is returning to the fundamentals of the game. He has hired a new coach (tennis great Ivan Lendl) and is working tirelessly on the key building blocks of his game like the forehand, backhand, serve, spin, placement and power. He has a special diet and trains for endurance, strength, explosiveness and agility. His advice for us would likely be “Focus on the fundamentals.” For retirees, that means things like a retirement budget, debt reduction, asset allocation, distribution strategy, health care, Medicare and Social Security.
Cal Ripken, Jr. (Stay healthy)
Cal Ripken, Jr. broke a record in baseball that many thought was unbreakable: Lou Gehrig’s record for consecutive games played. As if to put an explanation point on it, he exceeded Gehrig’s mark by 501 games. How did he do it? He stayed healthy. “Early in my career I decided I never wanted to get out of shape,” he said. To make the most out of retirement, you should follow Ripken’s lead. Taking care of yourself and staying healthy will not only allow you to be more active during retirement, but it will also lessen the strain on your nest egg.
Mike Tyson (Don’t sabotage yourself)
Iron Mike won over $300 million in prize money during his career. Unfortunately, he also elevated bad decision making to an art form—horrible spending habits, jail time, biting off his opponent’s ear—and he was eventually forced to declare bankruptcy. Don’t be like Mike. One bad decision can ruin a lifetime of good ones. One of the earliest lessons in life is that actions have consequences and boy is that true in the final third of life. Don’t do anything that would derail your retirement dreams.
Lance Armstrong (Deal with adversity)
Things don’t always go according to plan. Markets can fall. The government can change the rules on things like Social Security or Medicare. There can be an unexpected illness. Being retired doesn’t mean that everything magically goes your way. After facing cancer, no one would have blamed Lance Armstrong if he’d decided to quit racing. Instead he fought through the adversity and eventually won the Tour de France seven times. Why didn’t he quit? "Pain is temporary,” he said. “It may last a minute, or an hour, or a day, or a year, but eventually it will subside and something else will take its place. If I quit, however, it lasts forever."
Michael Jordan (Diversify your income streams)
During retirement it’s helpful to have income from multiple sources like Social Security, a pension, savings, a small business or part-time work. This reduces risk and increases your options. Having several sources of income was one of the reasons Michael Jordan could afford to walk away from basketball and pursue his dream of playing minor league baseball. The pittance a minor leaguer is paid was no worry when he still had millions coming in from Nike, McDonalds, and Gatorade. You and I may have fewer zeroes in our paychecks, but we can follow the same principle.
Muhammad Ali (Visualize the future)
Muhammad Ali once said, "I hated every minute of training, but I said, 'Don't quit. Suffer now and live the rest of your life a champion.'" Getting ready for retirement is hard work. It takes discipline and sacrifice. Experts in behavioral finance have shown that you can make it easier and improve your chances if you do what Ali did and visualize yourself in the future.
A recent study1 showed participants pictures of themselves and then asked them to allocate money toward a hypothetical retirement savings account. Half were shown current pictures of themselves. The other half were shown “age morphed” pictures of themselves that depicted what they would look like in old age. Those shown the age adjusted photos allocated twice as much money to savings as did the others.
I could go on and on drawing parallels between athletics and retirement, but you get my point. Just like the athletes we adore, we all want to succeed and do our best. And like those athletes, if we work hard and keep our head in the game, good things will come. As Yogi Berra might say “Retirement is 90 percent mental. The other half is physical.”
FPA member Joseph R. Hearn is the Vice President at Teckmeyer Financial and author of the books If Something Happens to Me and The Bell Lap: The 8 Biggest Mistakes to Avoid as You Approach Retirement.
1 Ersner-Hershfield, H., Goldstein, D., Sharpe, W., and Bailenson, J. (2010). Future Self-Continuity and Saving Behavior. Working paper.