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Case Study 3: Dwayne, Ready to Retire
Introduction
My most recent client Dwayne is a 45-year-old married man with 3 teenage children in
private school and he wants to retire in a decade. As an account executive at a major tech firm,
he makes great money in the present and he lives like it. He has reservedly saved for retirement
investing only 10% of his income annually and he is beginning to realize that is not enough.
With his wife currently a stay-at-home-mom, like a pregnant mom eating for two, Dwayne is
saving for the retirement of two people.
Now I know comparison is the thief of joy, but I couldn’t help but look at my own life in
its current state since Dwayne and I are the same age. I have been saving and investing for
retirement for the past 10 years as well, but I only have 1 child who is in college and no husband
(as of today). Dwayne and I earn a similar salary, but I have multiple streams of income and zero
debt where he does not. In my financial coaching training I was fortunate enough to learn the
fundamentals of diversification, the various financial vehicles and how they positively impact
your bottom line, and I am so happy to share this information with Dwayne as we work together
to formulate a strategically aggressive retirement plan to get him to his retirement goal. While
the bible doesn’t tell us specifically how to retire it does tell us to have a plan or vision (Proverbs
29:18), submit that plan/vision to the Lord (Proverbs 6:13), get wise counsel (Proverbs 5:22) and
the Lord will establish our plans by ordering our steps (Proverbs 16:9) (Zondervan, 2010).
Session 1
During our first session and all subsequent sessions we opened with a word of prayer
thanking God for the finances we do have and asking Holy Spirit to guide our discussions
teaching us how to multiply our money like the servant in Matthew 25 (2010) who received 5
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talents, wisely invested it, and doubled his master’s money. From there I introduced myself as
his CFC and covered the mission, vision, and values of the American Association of Christian
Counselors, what I provide as a financial coach as well as the structure for our sessions together
that will be guided by Holy Spirit (Murphy, n.d.-a).
From there I reviewed Dwayne’s intake form with him and discovered a good amount of
relevant information regarding his current financial state. Dwayne felt like he was in great shape
financially and wanted to save more. I had to break the news to him that based on his spending
habits and his lifestyle, he wasn’t doing as well as he could be in preparing for his future. I asked
him a series of quantitative or factual questions to gage his desired outcome (Huff, n.d.). He told
me he wants to retire in 10 years at age 55 because he didn’t want to be like his parents; forced to
continue working well into their sixties. He also told me that his lifestyle costs about $18,000 per
month which includes expenses like the mortgage on his $400k home, the lease payments on the
2 luxury cars that he and his wife drive, the tuition payments for his 3 kids’ private school
attendance and debt repayments. He said he wants to retire living on 50% of his current annual
salary. Together we looked at the personal financial statement that I created for him and showed
him his strengths (investments for retirement and children’s education and home ownership) and
his weaknesses (luxury car leases, use of credit 3 of 7 cards in lieu of cash and $2996 credit card
debt). I pointed out the areas he is spending frivolously asking why he needed to lease a brand-
new luxury car every other year? His response was that is what the elites do citing the tax
advantages. I told him that is a money myth and revealed to him that a vehicle lease has the
highest cost to operate than any other form of vehicle procurement (Ramsey, 2013). I also told
Dwayne that because he doesn’t own a business there are no tax advantages for him in leasing a
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vehicle and even if he did, owning outright would be way more cost effective in the short and
long run (Ramsey, 2013).
We moved on to the qualitative questions surrounding why he’s retiring, what he and his
spouse plan to do during retirement and what will bring him fulfilment once he’s no longer
traditionally employed (Ramsey, 2013). Dwayne shared that he wants to retire because he
learned a valuable lesson from watching his parents work well into their advanced years because
they didn’t have the knowledge necessary to plan for their financial future. He also
communicated that he desires to begin working on some ministry endeavors that his current job
and life circumstance with 3 teenage children doesn’t afford him and his wife the time to do.
Together they plan to volunteer at their local church using their gifts to support the building of
God’s kingdom. I was immediately reminded of Numbers 8:23-26, “Now the Lord spoke to
Moses, saying, ‘This is what applies to the Levites: from twenty-five years old and upward they
shall enter to perform service in the work of the Tent of Meeting, but at the age of fifty years,
they shall retire from the service of the [tabernacle] work and serve no longer. They may assist
their brothers in the Tent of Meeting to keep an obligation, but they shall do no [heavy or
difficult] work. Thus, you shall deal with the Levites concerning their obligations.’” (Zondervan,
2010). I commended him for his vision and excitedly moved to the final part of our session.
We ended the session with me explaining that while he is more advanced in retirement
planning than most Americans, to retire when he desires, he still has a good way to go. With a
shift in lifestyle now and an aggressive plan he can accomplish it (Murphy, n.d.-a). For his
homework I tasked him with reviewing his personal financial statement and auditing his
spending. He was to then find and implement 2 areas where he could cut unnecessary spending
and increase income. I asked what he took away from the session and his response was, “Today
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was a reality check for me, and I needed it.” Following up I asked what he looked forward to
discussing in our next session and he said he wants to review portfolio diversification options.
Session 2
After praying we jumped right into his homework review. He said after visiting the car
dealership he returned one of the luxury cars, worked out a deal to purchase the other and bought
a second [used] car that was $20,000 cheaper than the one that was returned. His monthly
payment was cut by 25% and with his lowered interest rate he ended up saving thousands on a 3-
year payment plan which left him with 2 years on the manufacturer’s warranty. He also
enthusiastically remarked that he didn’t have to eat the initial depreciation on the car since it was
used. He also said he was going to develop a budget and stick to it so he can further reduce his
spending. He wasn’t sure about why he needed to increase his income since he was making
$250K per year.
Moving on, we looked at his vision for retirement and he developed the following
SMART goal, “To retire in 10 years with zero debt in a lower cost of living area with an annual
income of $100,000 per year.” I pulled up the BankRate.com retirement calculator and plugged
in the numbers. Based on his current investment rate his retirement savings would only last for 6
years and to maintain that cost of living he would need to invest an additional 60% of his income
to reach that goal. He looked defeated. But I told him all is not lost. He can keep the same goal if
he and his spouse started a small business that she could run during the day while the children
were at school. He liked the idea but wanted to run it by her first. He ultimately amended his
SMART goal to, “To retire in 10 years with zero debt in a lower cost of living area with an
annual income of $75,000 per year.”
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From there we looked at investment opportunities and retirement savings vehicles that could
push him to his goal. I asked how he managed the 10% of his income that he invests, and he told
me all of it goes to his 401K, his company matches up to 6%. I inquired about his tech-firm’s
stock options since they’re a publicly traded company. He said he has 50 shares that came with
his initial offer of employment. We also discussed the difference between 457 and 403(b) along
with other tax deferred contribution plans and Roth plans some of which receive post-tax
payments (Huff, n.d.). Traditional individual retirement account (IRA) plans are tax deferred and
reduce taxable income for the year contribution but will be taxed when it comes time to
withdraw after retirement. Roth IRAs receive taxed contributions and the withdrawals after
retirement age are non-taxed (Schwab Brokerage, 2024). We discussed him investing his
retirement savings into a mix of mutual funds as an option for long-term financial increase. With
the right mix of various growth, equity, and income funds he would see a steady return year over
year with minimal risk (Ramsey, 2013). And incorporating a portion of his investments into
Emerging Market Funds or Small Cap funds has a higher risk but also a far greater return
(Ramsey, 2013). We also discussed penalties for early withdrawals from his retirement accounts
since his goal retirement age was younger than 59 ½ years old. I told him he has to add that into
the equation which would increase his contribution requirement by an additional 10% (Huff,
n.d.).
With all of this information being presented to him, I could see Dwayne was becoming
overwhelmed so I followed the prompting of Holy Spirit and brought the session to a close by
commending him for establishing a SMART goal that he felt he could achieve. I asked him to
consider amending his retirement age goal by 4.5 years. I remarked that his plan didn’t account
for emergencies, advanced age care and other potential pitfalls. For his homework I tasked him
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with finding ways to increase his income (passively or through a business endeavor with his
wife) and to choose additional retirement investment options. I asked what his takeaways for the
session were and he responded he discovered that he and his family will have to make some
temporary sacrifices now to ensure the longevity and success of their plans for their financial
future. He also said he realizes how his upbringing influences a large part of his fiscal decision
making and he is ready to change that. At the conclusion of our time together, I recommended he
bring his wife for our 3rd session. I felt it prudent for her to hear what he’s hearing so that she
doesn’t have to depend on his interpretation of the information shared.
Session 3
Dwayne came in with his wife by his side for session 3 and we discussed his homework,
final decision on his plan and the action steps to achieve his retirement goals. He realized that 5
more years of working wouldn’t kill him, but it would keep him from being penalized and allow
him more time to save more money. He and his wife agreed to rent out their current house once
they retire to increase their passive income since their plan was to move to another area and they
also agreed to begin a Notary business and use the income gained to invest in their retirement.
Additionally, they used the Ramsey Solution website (2023) to research ways to cut costs and
decided to eat out less, meal plan, cut television subscriptions, follow his wife’s example, and
use cash for everything and stick to a realistic spending plan. To diversify his portfolio, he
decided to invest 50% of his retirement savings into low-risk long-term funds such as the growth
and equity funds and invest the other 50% in Emerging Markets Funds since he had some
making up to do. The two of them decided that the income from their small business would be
used to invest in the stock market. I asked about the savings for his children’s education, and he
told me it was in a regular savings account. I immediately informed them that they were amongst
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the 37% of Americans who make that same mistake and recommend they look into the
Education IRA has a more lucrative yield (Ramsey, 2013).
Just prior to the close of our session I took a moment to discuss asset protection
mechanisms and insurance planning. While he has a life insurance policy with his job, I told him
he could be missing out on the benefits of other life insurance policies such as Whole Life
Insurance which has cash value and universal life insurance policies that has investing vehicles
within the policy which can yield great returns (Carlton, n.d.). I also informed them of the idea to
prepare for the potential of long-term care needs and described some of the benefits of long-term
care insurance such as in-home care, access to assisted living facilities and inflation protection
(Carlton, n.d.).
At the end of our time together, I tasked him with the assignment of implementing his
retirement investment and savings plan and to get insurance to cover him and his family. I asked
what he took away from our sessions as a whole. He said he and his wife had to make a mindset
shift to begin processing what life will actually look like when they retire. He was thankful to
God that he chose to get financial coaching and plans to look for a financial advisor to assist in
making investment decisions and how to manage their assets better. He ended by saying he and
his wife have started praying about their plans and asking God for wisdom concerning how to
execute them.
Conclusion
I give all glory to God for the privilege of working with Dwayne and his wife as the make
preparations to enter into retirement. I can admit was difficult to highlight to him the reality of
where he was in terms of saving for retirement. The first 2 sessions were challenging for him, but
I could see Holy Spirit working to adjust his perspective and teach him what he should be aware
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of. One of the things I have learned as a CFC is the picture my clients paint is rarely the picture
that is revealed to them during our sessions, but it delights me to partner with them in crafting a
plan that gets them to their expected end.
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References
Carlton, B. (n.d.). Lecture Notes: Lesson 10 Protecting Assets: Risk Management and Insurance
Planning. LIFC603 Lecture.
Huff, Rick. (n.d.). Lecture Notes: Lesson 11 Retirement. LIFC603 Lecture.
Murphy, D. (n.d.-). Lecture Notes: Lesson 1 Introduction to Financial Coaching. LIFC603
Lecture.
Ramsey. (2023, September 1). How to cut spending. Ramsey Solutions. Retrieved March 1,
2024, from https://www.ramseysolutions.com/saving/how-to-cut-costs
Ramsey, D. (2013). The Total Money Makeover: Classic Edition: A Proven Plan for Financial
Fitness. Thomas Nelson.
Schwab Brokerage. (2024). Individual Retirement Accounts (IRAs). Retrieved March 1, 2024,
from https://www.schwab.com/ira
Zondervan. (2010). Amplified Bible. Zondervan.
