A retirement plan

The last chapter of the last subject. First the plan, then what the whole stream was for.

Six steps

1. Estimate the number. Chapter 1. Retirement spending, adjusted for what stops, continues and rises, times about 25. An estimate you revisit beats a precision you never compute.

2. Total what you have. Chapter 2. Every pot, including balances left at former employers. Consolidate them.

3. Find the gap, and the monthly contribution that closes it. This is the number that changes behaviour, because it converts an abstract corpus into something you do on the first of the month.

4. Automate the contribution. Chapter 3 of Finance 101 and chapter 9 of the Risk subject: a transfer that happens before you see the money removes the monthly decision, and the monthly decision is what erodes plans.

5. Choose the structure. The buckets of chapter 7 — a few years of spending in cash, the medium term in bonds matched to their dates, and the long term in growth assets. Glide into it rather than switching on one date.

6. Build the floor. Chapters 4 and 5. Cover essential spending with income that does not depend on markets, and take discretionary spending from the portfolio where it can flex.

The page to write

• The number, and the spending assumption behind it
• Every pot, with balances and where they are
• The gap and the monthly contribution
• The intended floor — what is essential, and what will guarantee it
• The allocation, and how it changes approaching the transition
• Nominees, on every account, current
• Where the documents are, and who else knows

The last two are not administrative detail. Chapter 6's fourth risk is that you may not be the person managing this in twenty-five years, and the page is written for whoever is — possibly a later version of you who will be grateful it exists.

The five things that matter most

If the rest is forgotten:

Start earlier. The only lever available for free, available once.

Save a meaningful fraction. Chapter 3 of Finance 101: it is the gap between income and spending, not the income.

Keep costs low. Chapter 10 of the Mutual funds subject: a point a year compounds against you for forty years exactly as returns compound for you.

Keep growth assets, including in retirement. Chapter 6: a thirty-year retirement needs a corpus that grows.

Stay flexible. Chapter 5: willingness to take less in bad years is worth more than precision in the withdrawal rate.

Nothing there requires predicting anything, which is the point.

What the Finance stream was arguing

Ten subjects and a hundred and twenty-nine chapters, and they have been making one case.

Finance 101 established that what you keep is the gap between what you earn and what you spend, and that time does the work.

Markets showed that a price is the opinion of whoever traded most recently, not a measurement.

Equity showed a share's return has exactly three sources, and only two come from the business.

IPOs showed the seller chooses the timing, the disclosure and the band.

Mutual funds showed the cost is charged inside the NAV every day, and the plan you buy matters as much as the fund.

Fixed income showed a fixed promise means the price must move, and that certainty about a number is not certainty about what it buys.

Company analysis showed profit is an opinion and cash is closer to a fact, and that every multiple is a discounted cash flow with its assumptions hidden.

Derivatives showed what happens to ninety-one per cent of the people who trade them, four years running, measured by the regulator.

Risk showed that volatility only becomes loss when you are forced to sell, and that the defences are dull.

Tax showed that the law can be rewritten under your feet, and that structure outlasts rates.

The common thread: almost everything that matters is knowable, published, and dull — and almost everything that destroys outcomes is a decision made quickly under pressure.

Which is why every subject ends the same way. Write the page. Decide while calm what would change your mind. Then let time do the part that only time can do.

The point

Estimate the number, total what you have, find the gap, automate the contribution, structure the buckets and build the floor. Write it on one page with nominees and locations, and tell someone it exists. Start earlier, save a meaningful fraction, keep costs low, keep growth assets, and stay flexible — none of which requires predicting anything.