BOOK REPORT

Updated 12/18/20

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Book Report on

How to Make Your Money Last: The Indispensable Retirement Guide

One of the reasons that we started this website was to educate ourselves about the pre-retirement planning process. In addition to combing websites, newspapers, and magazines for tips, I thought that it would make sense to read some books on the topic.

Recently, I read an interview with the author of How to Make Your Money Last: The Indispensable Retirement Guide, Jane Bryant Quinn. The title of the article was “Why this may be the only retirement book you’ll ever need,” so I ordered the book from Amazon and read it from cover to cover.

Confession time:

I have to admit that what pushed me over the edge to make the purchase (it was not available at our public library) was the article’s reference to the author’s decision to live in Rome for a year after retiring. I spent 8 months in Rome in 1985, plus return visits in 1987 and 2004, and still dream of returning for an extended stay. I thought that maybe the book would mention her decision-making process in living overseas during retirement. At the very least, I thought that it was a good sign that she was a like-minded person.

Spoiler alert:

Unfortunately, there is no mention in this book of the author’s Roman holiday, but she does deliver on her promise to educate readers on how to make our money last for decades after retirement.

A. Why buy this particular book?

There has been a January 2020 update of the title originally published in 2016, which had great reviews:

B. Who would you give this book to as a gift?

This book would be a great gift for people who are (1) considering consulting a financial advisor for help with their 401K allocations and other investments, (2) between the ages 55 to 64 and planning to retire in 5+/- years, and/or (3) retired and trying to make key decisions regarding their finances. The operative word here is “finances” and, for the most part, the book focuses on strategies to make your money last. It is not a primer for how to make something out of nothing.

C. What topics does this book cover?

Even if people expect to receive Social Security or other income streams during retirement, the writer points out that today’s retirees have every reason to be concerned that they will outlive their money. Therefore, over the course of 12 chapters, the book covers numerous topics falling under 3 main categories: Social Security, health care, and income streams and spending plans.

1. Social Security

The book begins by telling you to determine your annual retirement budget in order to rightsize your spending and identifies when you should ask for advice from a Certified Financial Planner. Then the author does a deep dive into the chapter on how to almost double your Social Security income. Indeed, the author devotes 48 pages to identifying all of the factors involved in deciding when you and/or your spouse should claim your Social Security benefits to maximize the payout. Did you know that there was such a thing as a full or reduced spousal benefit, survivor benefits, and family maximum benefits that should be considered? The book also points out the pros and cons of online Social Security calculators and includes pertinent advice regarding when and how to rely on Social Security representatives.

2. Health Care

Because health care can be expensive, the book next highlights various ways to get more from employer-provided health plans and to navigate the individual health-care marketplace. There is also a section detailing the options available under Medicare even if you and/or your spouse are still working after age 65 and if you decide to move or have two homes.

3. Income & Spending

The author then tackles the income potential of pensions, annuities, retirement savings plans, investing for income, home equity, and life insurance. The chapter on annuities panicked me so much that I started digging into our filing cabinets to find the original contracts that we signed almost 20 years ago. According to the author, anyone who has purchased or is considering purchasing an annuity needs to realize that they are complex vehicles that, over time, have been offered in a variety of different flavors. The book identifies the differences and pros and cons of an immediate-pay annuity, a multiyear guaranteed annuity, a deferred income annuity, and fixed-index or variable annuities with living benefit guarantees. Fortunately, the author provides a handy end-of-chapter summary of her views on when it makes sense to consider buying any of these types of annuities.

The author also points out the most tax-efficient way to tap into savings accounts during retirement. She also advises spending taxable and tax-deferred savings if that helps the retiree put off claiming Social Security until age 70½ (if single) or between 66 to 70½ (married) to get the most out of Social Security benefits. After doing the research, the author agrees with the standard advice of taking 4 percent of total savings in the first year and adding a dollar increment for inflation each subsequent year. Part of that strategy depends on having a safety net with 2 years of cash reserves and short-term bond funds.

In the chapter on tapping into home equity for income, the author’s advice to sell sooner rather than later for financial and emotional reasons was consistent with our research indicating that moves become less likely after the age of 65. For those planning on staying in their homes, however, the author carves out a very limited role for a home equity conversion mortgage standby line of credit if taken as early as age 62.

Finally, the chapter on life insurance explains how to extract more cash or coverage from your life insurance policy. Over the course of 37 pages, the author helps you navigate this extremely complicated area to determine whether you need to discontinue or restructure your policies.

D. Writing Style/Reading Strategy?

This book is written in a non-technical, conversational style while covering dense material at an extremely fast pace. The author sounds like a smart trusted friend armed with decades of experience researching and reporting on personal finance. The book should serve as an important resource on your bookshelf, but you need to read it through cover to cover at least once and then go back and re-read the sections that you need to master right now. You do not know what you do not know. After the initial read-through, the handy index in the back of the book will allow you to refer to the chapters that you need to consult before making important financial decisions.

Is it easy reading? No, but failure to master the contents of this book and similar retirement books may mean that we do not outlive our money and we become a burden on our loved ones. The devil is in the details, and this book is crammed with tips to help you fly over the flaming rivers of hell to a comfortable retirement (and maybe even a trip to Rome).

I hope to see you there!