In this week’s episode of Retire in Texas, Darryl Lyons, CEO and Co-Founder of PAX Financial Group, unpacks one of the most common phrases he hears from clients: “I’ll retire in five years.” But what does that really mean – and what’s holding people back from following through?
With stories drawn from real-life experience, Darryl explores how this five-year mindset can become a psychological trap, one that offers comfort without commitment. From the emotional side of financial planning to the real-life consequences of delay, this episode is a call to clarity and action.
Key highlights of the episode include:
- Why “five years from now” is often more of a coping mechanism than a plan.
- Why defining your retirement date matters, and how to actually do it.
- Small but powerful first steps that move your plan forward (like healthcare and Social Security strategy).
- Why simplifying your life may be the smartest financial move you make.
Whether you’re five years out from retirement – or have been saying that for the last decade – this episode offers thoughtful insights to help you stop waiting and start planning.
For more insights or to connect with a PAX Financial Group advisor, visit http://www.PAXFinancialGroup.com.
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Transcript:
Hey, this is Darryl Lyons, CEO and Co-Founder of PAX Financial Group. And you’re listening to Retire in Texas. And this information is general in nature, it is not intended to provide specific investment, tax, or legal advice. Visit PAXFinancialGroup.com for more information. Okay, so you want to retire in five years. I mean, I don’t know if you’ve ever heard anybody say that.
Maybe your parents, maybe it’s you. Maybe, a friend. I’m going to retire in five years. What is it, about five years? And remember when I say retirement, I’m talking about pivoting. Not necessarily retirement by the definition, we know which, the definition of retirement is the disposal of an asset over its useful life. That’s not what I’m talking about.
I’m talking about pivoting. But I’ll use retirement because it’s easy for us to digest. I want to retire in five years. You’ve heard this so many times. So, what is this idea behind five years? It’s kind of our brain’s way of managing hope and fear at the same time. And it’s far enough that we feel like we’re doing something, it gives us a little degree of ambition without really taking action right now.
So, this five-year thing gives us a little dopamine hit. You know, we study behavioral finance a lot. And it’s kind of crazy how money is really more so, you know, in the head and in the heart than even in the math. And so, here we have this idea of saying, I’m going to do it five years from now, which is basically a little dopamine hit.
It doesn’t give us discomfort, but it just gives us a little, little bit of dopamine and something to think about and something to chew on. And it’s non-committal. But, you know, the problem is, is that you’ve got a lot of people depending on us, you, to pull the trigger. I mean, there’s kids and grandkids waiting for the day.
There’s spouses, there’s family, and frankly, there’s employees. And I don’t think we think about this enough, but there’s a lot of people, like, waiting to take on this new responsibility. And they’re waiting for John to retire or Mary to retire. And then they want to step into that role. And, or business owner, there’s people waiting to step into a leadership role, into the next chapter.
And yeah, people don’t talk about it, but they whisper and they’re waiting. Because so-and-so’s not committing. They keep saying every five years, they keep procrastinating. I can’t tell you how many times I’ve heard this story. I’m gonna retire in five years. I’m gonna retire in five years. Let me give you one story to help you.
I’ll give you a couple, actually. So, Linda, let’s talk about Linda. She spent 30 years working in a career, raising a family, paying bills, doing everything that she had to. Just hustling. But when it came to retirement, she had a habit of just kind of putting it off. She always thought, I’m going to start saving seriously in five years, because there’s just a lot of stuff, as you would imagine, braces and camps and things.
But I’m gonna start saving in five years. And then in five years, came. She was like, okay, another five years. Because of course now we’ve got, whatever weddings or other things that come up because, as you know, stuff always comes up. Then she finally gets like 15 years down the road, she finally gets to sit down with somebody and starts talking through this.
You know, this idea of retirement and she doesn’t have enough. And she lost something that she’ll never get back. That’s time. And that’s the magic of compounding, which is very legit. Never, ever, ever, ever will she get that back. And so not that life is horrible, but there’s regret. She has regret. I’m not doing something.
And then just always dealing with the chaos. And I just don’t want that to be you. Let me give you another example. We’ll call this guy Mike. And any relation to these names is just coincidence. It’s not as though I’m actually telling real life stories here. I’m using experiences that I’ve gathered, collectively. But Mike is a business owner, and, he’s from Dallas.
Sharp mind, works hard. Strong work ethic, you know, proud provider. Been working for this business, is one of the founders, and one of the few founders for over 30 years just grinding it as an engineer. He said, okay, just five more years and then I’ll retire. And then so if you think about it, like when you start doing some of those things and you get your wife in the room or your spouse and you start talking, okay, here’s the dream.
So, we’re going to travel to Italy, we’re going to go to the Rockies. Maybe we’ll even get an RV and travel around the country. And so, Mike, you know, just like I guess most men that have been grinding over the years to get a little bit of high blood pressure, nothing alarming. And he ran the numbers. He actually sat down with an advisor, ran the numbers and the advisor said, you’re actually pretty good.
You could pull the trigger now. But Mike, in his engineering mind, said, I’m going to wait until my investments hit $1.5 million and then I’m going to pull the trigger, which isn’t always a bad thing, but there are consequences for putting this thing off. So, as you would imagine, year four rolled around, getting closer, but Mike started to kind of feel a little bit more tired, just kind of like, you know, stressed.
But he just brushed it off. Five years came, hit the number and he had a stroke and he recovered mostly. But his energy was never the same. Travel was harder. Hiking was out. Long distance driving was tricky. I mean, obviously trying to stay positive, but it just wasn’t the same. And definitely no RV. So, you know, sitting and just kind of wrestling with life regrets.
A glass of wine and a fire. He said if I could do it over again, I would have pulled the plug at 60. The money was plenty. And I don’t know, really. There wasn’t just a real reason. It was just kind of an arbitrary. I felt better, but I should have retired earlier and, you know, this stuff happens all I mean, I want to say every day, but, you know.
I don’t see clients like I used to, but I saw this a lot where the idea of retiring in five years was just kind of a psychological hack, was just ambitious enough, but noncommittal enough. So how do we solve for this? How do we push through this idea of this five-year nebulous concept? I think there’s two ways to do it.
One is define the date and two is to take the next step. So, let’s unpack that just in brief. So, defining the date, you could write it on the calendar which is a pretty simple exercise. That’s a start. Some people I’ve seen that’ll do kind of like a retirement vision board. Think deeply. Maybe read some books, there’s some good books if you ever need some recommendation.
I’ve read a ton of them on retirement, but some of them will do, like whiteboarding and maybe write down or put pictures on a like a word document to try to dream about retirement. That kind of helps put things together a little bit more, announcing it to people, you know, kind of getting it out and, that most psychologists will say if you commit something verbally to somebody else, it’s more likely you’re going to do it.
So that’s a good hack. Savings targets. We talked a little bit about that. That helps. So, you know, if you have a savings target, I would probably give it a range versus an absolute number. You could even if you wanted to start planning your retirement party, you know, rent the space out or, you know, start thinking about that a little bit more.
But these are things to just kind of define the date, not a date that just keeps moving. So that would be your first next big step. Your second step is to take the first step. That sounds kind of backwards, but, you know, you don’t really have to see the whole staircase to take the first step. You don’t.
And when you take the first step, it’s going to start opening up kind of a pathway. James Clear in Atomic Habits. He talks a lot about this. And if you ever grab the book, it’s a great book. It’s become almost a cult classic now. He says you do not have to rise to the level of your goals.
Oh. I’m sorry. Let me say it this way. You do not rise to the level of your goals. You fall to the level of your systems. Really, another way to say that is you don’t rise to the level of your goals. You fall to the level of your strategy, like how you’re going to get things done.
So, I don’t need you to just, like create the whole retirement framework in day one, but just take the next step. One of the next steps a lot of people think about is, how am I going to solve for the health care in retirement? So many people say I’m going to retire at 65 because Medicare. But you don’t have to wait for Medicare.
You can jump on a lot of health insurance plans before Medicare. In fact, PAX. I say PAX is really good about helping navigate that. A lot of financial advisory firms don’t talk about health care. We talk about it a lot. That’s a little plug for us, because I’m proud that we are able to navigate that. And we’ve actually helped people retire before Medicare age because we were able to figure out a way to get them health coverage.
And that was important because their health was deteriorating. And the only reason they were working was because of Medicare. And so, we’re able to come up with a strategy for health care to bridge the gap before Medicare kicks in. So, step one might be just making sure you got your health care strategy down. Step two might be or maybe another step one like.
The order is not critical but figuring out when you’re going to pull the plug on Social Security and crunching those numbers, it’s not too difficult. There used to be a lot more loopholes in Social Security. Now it’s pretty cut and dry. A good next first step is funding your 401k. If you’re over 50, you get some catch up provisions.
So, you need to make sure you’re maxing out your 401k. It’s a good first step, converting your IRA if you’ve got any old IRAs. Converting those to Roths is a good step. Paying off debt. My Dave Ramsey folks paying off debt, moving or downsizing, that’s a big one, but one that I wrote about in the book 18 to 80, how I just noticed over the years how many people got to a point in life where simplification became a priority.
And I’ve even seen that as I get older, how important simplification is. But I’ve learned that from some clients over the years and how valuable it is. And so downsizing and just selling some stuff that’s just, you know, you’re just tired of maybe even rental houses or whatever, just stuff that you just don’t want to deal with anymore.
They serve you well, but it’s just time. Maybe thinking about a part time job, what that looks like, developing some skills, or maybe cultivating a hobby. I say habit, but hobby. Hobbies can be a habit. And if you’re selling a business, that’s a whole other first step checklist. But that could include, you know, business valuation or, you know, setting up a buy sell agreement, succession planning, making sure that there’s enough cash for buyout, whether that’s internal or external, like, that’s all.
That’s the whole staircase. But what I’m asking you to do is just kind of pick one and say, this is my first step. A good first step is certainly meeting with a financial advisor, because then they can start, you know, kind of laying it out a little bit more. You know, again, you can Google these things, ChatGPT things.
I think there’s a certain point where you’re going to need to sit down with somebody, because you’re going to need somebody that has some empathy and can use some judgment on the order of these things. And I think that’s why our role as a financial advisor is a helpful one. But just define the date. Define it.
There’s a lot of people sitting there waiting for you. And this is not retirement as we know it. This is not the disposal of an asset. This is you pivoting into the next chapter with purpose, with good health, with vigor, and looking for opportunities to make a difference. So, define the date. Take the next step and then follow the breadcrumbs and make progress.
Because you will wake up in five years and you will be ready to go. And as you know and I know, five years goes by like that. Remember, you think different when you think long term. Have a great day.
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