Why It's Time to Retire the Idea of Retirement with Derek Coburn

0:08Hello and welcome to another episode of the Ductate Marketing Podcast. This is John Chance. My guest today is Derek Coburn. He's a seasoned financial advisor and entrepreneur with over 25 years of experience. He is the co-founder of Cadre, an exclusive community of CEOs and entrepreneurs, which he launched with his wife, Melanie. Derek is also the author of the bestselling book, Networking is Not Working. And we're going to talk about his latest book today, Let's Retire Retirement, How to Enjoy Life to the Fullest Now and Later. So, So Derek, welcome back to the show. Thanks, John. So happy to be here.

0:44So I know you've done some research on this. So I'm just going to ask you, like, where did retirement come from? Did people in the Middle Ages retire or is that like a kind of a new thing? Yeah, it's barely 100 years old. It first started in 1889. It was the first social program developed in Germany by a chancellor named Otto von Bismarck. and they selected the age of 70 at the time because that was the age that most people died. They brought it down to 65 about 10 years later. FDR, when he was setting up Social Security in 1935, thought it sounded like a good number at a time when life expectancy in this country was 71.

1:26So it's barely over 100 years old and it was certainly never intended to be this thing that you know, did for 30 plus years. So is that, was that an alternate title of your book, Work Till You Die? I'm not sure. You know, I think that may not have gone over as well. Dan Pink, like five or six years ago, told me, he's like, I think a good title for your book would be How to Never Retire. And I thought it's a good title, but I told him that I think that there's just not enough people, certainly not then, that were raising their hand and knew they already did not want to work. I felt like I needed to have a title that was more inclusive to bring people in and with, you know, dangling a carrot and then kind of trick them once I got their attention.

2:06Yeah. Yeah. Well, and we'll get back to how you're defining retirement because that's key to this. But, you know, as a financial advisor, I mean, most financial advisors spend a whole lot of time talking about people saving for retirement. I mean, has that been something you've had to kind of correct in your own advising or is that something that's never really been a part of your MO? You know, I've just been doing this. And the reason that I wrote, decided to write this book in 2017 is I realized that collectively, the best thing that I had done for the majority of my clients is help them come to the realization that they weren't going to be happy sitting around doing nothing for 30 years.

2:41And I started off writing this book with the intention to use it as a business card to attract more high net worth clients that I might want to work with. but I sold my practice to a private equity company in 2019 and got some flexibility. And then COVID happened. I kind of set it aside for a number of years. And I feel like now, because I'm not looking to grow that practice, I was able to write a book that would appeal to a broader audience, be helpful to a broader audience. But to your point, financial advisors are not saying, do you want to retire? They're saying, what age do you want to retire?

3:14And everyone is being opted into this concept and they're just going along with it, I think, without really questioning whether it's going to make sense for them or not. Yeah, and of course, one variable to this whole thing is that we're all living longer, right? I mean, 65, you were maybe incapable of doing a whole lot more 100 years ago in the workplace, but right, but now, what's Warren Buffett, like 90? I mean, so how does that factor into this idea that if you retire at 65, I mean, you are probably looking at 25, 30 years. Yeah, well, you're seeing this unretirement movement that's starting to happen.

3:54Brian Clark is doing some cool things around it with his new project further, but essentially 25 to 30 % of people who have traditionally retired are going back to work. Some of them are doing it for the money, but most of them are doing it because they missed the connection, the purpose, the ability to contribute in a meaningful way. And I think there's just a lot of people that have gone along with this. They were told if they made sacrifices and did things a certain way that they were going to be rewarded. They were going to be rewarded with this free time and this happiness and this ability to do whatever they want to do.

4:28And it's not playing out the way that they thought it was going to. Well, and even worse, maybe they worked themselves to the bone, worked more hours, sacrificed their family with the promise of what comes after. Right. And then when they got there, it didn't come. right? Exactly. Yep. Like the arrival fallacies, this promise that it would be a certain way and then it's not. Yeah. So that's a big part of your book. And that's why I'm saying, I think you're saying let's retire retirement, but you're also redefining retirement. Aren't you a little bit in this? And a big part of the book is like, let's have a personally fulfilling life right now.

5:03Yeah. I think that a lot of people just don't realize how well the math works out. So I'm saying to work longer, but I'm also saying that by recognizing that you'll probably work longer it should translate into you not feeling like you have to work a lot of extra hours now when maybe your kids need you more or maybe when you want to travel or date your spouse more aggressively. It's more about taking advantage of the fact that this income will be coming in the future. And it's sponsoring the idea that you can do these other things and invest in these other relationships and skills and experiences in a way that maybe you didn't think you were able to when you wanted to stop at 65.

5:39five. Your next book. I'm sorry. I got distracted there, Derek. Your next book is Date Your Spouse More Aggressively. That's maybe like the second or third time I've said that out loud. So there's a book I read a few years ago that I thought made a lot of sense. I think I might get the title wrong. It was something like Die Broke. But the idea was that a lot of people also just hang on to all this money that they squirrel away for retirement. And instead of like giving it to their kids who, or their grandkids to send them to college now. You know, like my children when they're 55 probably don't need my money as much as they might now.

6:18And I think that idea of take that, you know, take that vacation now, you know, do that big trip, you know, now, because when you're 75, 80, maybe you don't go to China or you don't go to Vietnam or something because it's harder. Yeah. You know, I think you're referring to Die with Zero by Bill Burkin. Yeah, that's it. That's right. That's right. And really good book. And I think that one area where maybe we differ a little bit is he's making the case that you're going to enjoy a trip to Europe more when you're 35 than when you're 50. You're not going to be as physically capable to do some of these things.

6:50But I'm of the belief, and there's a lot of science that backs this up, to where if you're taking better care of yourself now, if you're going on more trips now, if you're more active now, you're more likely to be able to continue doing those things in the future. It's really that people aren't doing those things and I have a harder time with it. Yeah. I'm actually an avid bike rider and I'm doing a triathlon this year, you know, and I'm 65. And my fear is if I stop doing those, I won't be able to do it. I think it's a valid fear and it's a fear well backed by science that agrees with you. I do have to let the cat out of the bag there.

7:26The triathlon I'm doing is a run fish drink. So not exactly the same thing, but yeah. So you have obviously in your financial practice, that's like literally your research lab, right? And to some degree, but then also cadre, you know, you work with a lot of high powered CEOs, folks that run their own companies in that, that are probably looking at, you know, they're not looking at the pension plan, you know, retirement. How has that in kind of informed some of your views? What's interesting is even the people that sort of know that they're never going to stop working, they're still living their life like they're going to.

8:03They're still making financial decisions and choices based on the fact they're going to retire at 65 like everyone else. So for example, when they meet with their financial advisors, they're saying, yeah, like, what do I need to do to stop working at 65 and to stop doing this? And I would say that with entrepreneurs and business owners, sometimes it's not retirement, but it's I'll get around to doing X once I have an exit, once I bring in a CEO, once I bring in someone else. And I think that it's the same story. It's justifying deferring maybe things in relationships that deserve more of your attention right now in the name of getting around to it once you have a certain amount of money or a certain financial experience or exit from your business.

8:47Are you finding, I think to some degree, we're talking about just extending how long you work. But what about a major pivot? It's like, I've been doing this for 30 years, done what I want to do here. I want to go do something different. I'm not going to retire, but I'm going to do something totally different. Maybe something that I think seems totally cool or that I'm more prepared to do today. Yeah. Look, so I have an entire chapter. It's the longest chapter in my book that are case studies about people that have taken this and they've gone into a lot of different directions. And one maybe that might be fun to share with you is just our mutual friend, Jay Baer, who I wrote for the book.

9:22And Jay sold his agency, I think early on in COVID and was sitting around and decided he wanted to start making videos about tequila. And so he went from that to really leaning into one of his passions and one of his interests. And after sharing the case study, I have a callback later in the book to say, look, I mean, if Jay Baer can make a lot of money drinking tequila and talking about it on video, then I'm sure that there's a lot of different cool ideas out there that are waiting for you as well. Yeah, that also necessitated some amount of travel to some places he hadn't spent time into. So I think he's mostly hurt by the fact that more people recognize him as the tequila guy than the keynote speaker.

10:10He's still doing a fair amount of that too. Hey, it's John Jantz here. Look, if you're an agency owner or a marketing consultant who's feeling the pressure, right? tactic overload killing your groove, retainers drying up, AI is changing the game. Then it's time for a new model. That's why we created the Anti-Agency Model Workshop. Look, there's nothing wrong with agencies. It's the model that's broken. So what's the new model? It's a framework for delivering strategy first, system-based marketing that scales without burnout. Look, learn how to evolve and thrive in the future. Check out dtm.world slash new model.

10:48That's dtm.world slash new model. So talk about some of the changes. Maybe they're not changes, but if somebody's going to read you, pick up your book and really the ideas in it just resonate. What are some of the changes that they're probably going to encounter? And maybe it's just mindset. it? Yeah. One of the first things that I want to point out is just the financial impact it's going to have. And so I share an example in the book about a fictitious guy named Tony, who's 45 years old. He makes$150 ,000 a year, and he has$150 ,000 saved up for retirement. You could call it$250 ,000, $500 ,000,$100 ,000, whatever you want it to be.

11:27But if Tony wants to have a traditional retirement at 65, he has to save about$2 ,500 per month in order to make that happen, which is 20 % of what he's bringing home, which is a non-starter for most people. That would mean that you are saving about what you're living on. If Tony decides to work until he's 75 instead of 65, the amount he has to save on a monthly basis goes from$2 ,500 down to$110 per month. It goes down by 96%. And even if he doesn't want to work till he's 75, he wants to go till he's 70, it goes down 75 % to$600 a month. And so we've all seen these articles that make us feel really dumb about how we should have saved more when we were 22 years old and taking advantage of compounding interest.

12:11And while a lot of us didn't do that, and even if we would have done that, we weren't really earning a lot of money at that time compared to what we're earning now anyways. There aren't a lot of articles talking about the benefits of having the advantage of compounding interest by letting it sit in for an extra five or 10 years longer. So immediately, I want people to know, I want people to see they have a lot more money and a lot more time that they can spend differently once they realize, you know, I'll probably be doing this a little bit longer than what I was originally thinking. Yeah. I mean, doesn't even factor in, assuming it'll be there for a few more years, doesn't even factor in the escalation of social security, right?

12:45Yeah, exactly. I'll tell you like something maybe more specifically, 401k plans became all the rage, mainly because of the idea that I can put money away on a tax free basis while I'm working, get a tax deduction based on my current tax bracket. and when I pull it out, I won't be working. So I'll be in a lower tax bracket. And that seems like a no-brainer to anyone when you lay it out like that. But once someone realizes there's a good chance they might be working into their 70s and they're gonna be taking required minimum distributions from their 401k plan and they're still earning an income, then maybe they're not in a lower tax bracket.

13:23All of a sudden that tax hire bracket. Yeah, maybe this 401k plan isn't as good of a deal as it seems. And without getting too technical here, like an easy fix for that, right, is I think over 90 % of 401k plans right now have the option to convert it to a Roth. And that might be something that people want to do where they're making their contributions on a post-tax basis. But that's just one example of maybe how you're thinking should change a little bit once you realize you might be working a little bit longer. You've also missed, you know, I know in our case, we have a 3 % match on the, you know, employer match.

13:54So that certainly helps that out a little bit. I say that's the place, even maybe before you work to aggressively build up your emergency reserve fund, if you're getting a match, probably take advantage of that. Plus owners have the ability to profit share into a 401k. Yep. Which I may or may not have taken full advantage of every one of those. Amazing. Yep. Is there any lifestyle change? Because I am here and I'm just going to work longer, right? So how does that affect my spouse? How does that affect, you know, other lifestyle things? I mean, is that, you know, is that something that's going to be realistic in that regard?

14:31I'll give you like an even short term example of how it's playing out for me and some people I know. So I have a 15 and a 12 year old and I spend a significant amount of time with them, with my wife, with my friends compared to most people. As your Instagram account will attest. Exactly. Exactly. And one of the driving factors behind that is that when my youngest moves out of the house in five and a half years, I'm going to be ready to turn it up a notch. I'm going to be ready to work even more than I'm working now. And just knowing that I'm going to have this income coming in five or six years really frees me up and liberates me to lean into spending as much time with them as possible.

15:11And I think that's just the more shorter term, more abbreviated version of how it works in my mind for thinking about what I'm going to be doing 20, 30 years from now. Are you doing any coaching workshops, anything outside of the book? Yeah, I'm not. I'm open to it. I'm interested in it, but I feel really good about where I'm going right now and this message that I have to share. And we'll see where it goes. Yeah. Yeah. And because I think one of the challenges, it's not necessarily just a, oh, implement these five steps in this framework. And you'll be, I mean, it's really a mindset first, right?

15:47I have to accept this idea because I've spent my whole life, you know, thinking a different idea. Yeah. Yeah. I mean, look, and I'll give you an example of that. I mean, I have clients who are in their seventies who have, you know, significant assets, right? I'll say client A has, client A and client B both have$15 million. Client A and client B could spend their money as much as they want from now until they pass away and they're going to be fine. Client A is working a job making about$100 ,000 and$150 ,000 a year doing things the way they want to do on their terms, how they want to do it. And client B is not doing anything at all.

16:25Client A is spending their money in so much more of a carefree way. I think mainly because they know they're still making money that's still coming in. They haven't entered that phase where, oh my gosh, all I'm doing is taking out right now. Or watching the news or the stock market to see what happened to my retirement account, right? Yeah, exactly. But I agree with you. I mean, again, even the people that know they're going to work longer, they haven't really done the software update to make a change to how they're living their lives. Yeah, yeah. So are there first steps? I mean, is there like, how do you get people rethinking their retirement plans?

17:02Well, it's a couple of ways. One is I shared the example about how they now have more money just by realizing, and that usually makes people feel a lot better about leaning into it. Oh, gosh, yeah, I'll easily work an extra couple of years. Are there calculators? I mean, have you developed calculators that could actually allow somebody to put those numbers in? Yeah, I have a calculator on my website, which I can share with you. It's DerekHoburn.com forward slash never retire. And it kind of allows people to enter in their own numbers and plug in and see the difference that it would make. but it's that, but it's also combined with maybe, you know, appealing to their fears and their concerns.

17:37So one of the, one of the examples I share in the book is when my boys were 10 and five or 10 and seven, we had a nighttime routine where we would take turns, my wife and I laying in bed with them for 10 or 15 minutes and helping them settle down and go to sleep. And it's really nice when they're that little. And I caught myself with my oldest. I'm like, this is not going to last much longer. And here I am most nights wishing it would hurry up and end. Hurry up and fall asleep. I'm not telling him this, but I'm saying it to myself. I want to go watch a show. I want to go finish this work, respond to this email.

18:09And I really worked hard. I was like, I want to appreciate this and value it more. So I had this thought, what if a company invents a time machine? And 20 years from now, they offer me the opportunity to stroke a check, to go back in time for one night with the 10-year-old version of my kid for one nighttime routine, one nighttime snuggle, what would I pay for that? And I caught it 50 grand. I'd pay more than that. But I know that 65-year-old me would pay 50 grand in a heartbeat to do that. And I think we're just having parents are having these$50 ,000 moments happening all the time that we're taking for granted.

18:43And I think me personally, I'm going to really miss my kids when they're gone. And I know there's going to be a new phase. I know that it's going to be good, hopefully. I know that our relationship will evolve, but I really don't think that parents are spending the amount of time that they'll wish they would have spent with their kids. Yeah, it's interesting. I'm in a different phase in that I have grandchildren now. And I will tell you that college is a different phase, but post-college is really... I mean, we spend... They're all over the country now and we spend a fair amount of time with them as individual family units.

19:18And I will say that's pretty cool. Yeah. I see how you're doing it, man. I have a lot of respect and I have no doubt that you are, that you guys are just amazing grandparents. Well, that's one that there's, you know, just like parenting, there's no like course or book that you can read that will actually allow you to know how to do it. So we're all doing this. Yeah, absolutely. Well, Derek, I appreciate you taking a few moments to stop by. It's always great to catch up with you. Is there someplace you, you already mentioned DerekCoburn.com. Is there anywhere else you You mentioned that people might want to connect with you or find more about the book.

19:52Yeah, that's great. Like I've already been writing and elaborating on a lot of the ideas from the book that aren't in the book on my website. I'm really just looking forward to starting a movement and seeing how far we can take this thing. So I appreciate you having me here. And it's always wonderful to spend the time with you. Yeah. Well, again, appreciate you coming by and hopefully we'll see you one of these days out there on the road. All right. Thanks, John.