You can improve your retirement and your chess game in 10 minutes. Using the 10-10-10 Rule, you can improve the outlook for retirement in the short, intermediate, and long term. The approach is similar to what some chess players do to improve their game.
I love playing chess. Growing up, I learned chess from my neighbor, who was about four years older than me. He beat me in every game. But I never gave up. I was disappointed at losing, but I never got frustrated. I got more determined. Strategy was not my strong suit when I was twelve years old. I just liked to play the game. But after beating me about a thousand times, my friend pitied me and started to teach me strategy. I also learned a beneficial thinking strategy that I teach to people for retirement planning. It is called the 10-10-10 Rule.
I’ll show you how it applies to chess and how you can adapt it to improve how you might live when you retire.
For chess, the first ten applies to the next 10 minutes in a game. It can vary, but the average tournament chess player will average four or five moves in 10 minutes. So within the 10 minutes, a player strategizes their next four of five moves. The second 10 corresponds to the intermediate-term game plan. What will the player do in the next ten moves? And the last ten corresponds to long-term improvement as a player. During this time frame, a player thinks about their strengths and weaknesses and starts developing a playing style and repertoire of openings and defenses.
The key to winning at chess is anticipating your opponent’s future moves and how you will counter those moves. That forward-thinking strategy is called second-order thinking.
The 10-10-10 Rule in retirement.
Similarly, the 10-10-10 Rule can also be a beneficial retirement planning strategy. It can simplify retirement planning and make it more accessible for anyone to improve their odds of a happy retirement. Here’s how to use the 10-10-10 Rule for retirement planning:
Step One of The 10-10-10 Rule
The next 10 minutes: This step may seem out of place, but you’ll initially focus on your immediate retirement needs. Ask yourself these questions. But don’t go into a lot of details right now. Be brief. You want only to take 10 minutes. Ready? Go!
- What is a vital retirement goal for you?
- How much money do you need to save to meet that goal?
- Are you currently contributing to a retirement account, such as a 401(k) or IRA, that will help you get that goal?
- Do you need to adjust your current savings plan to meet your retirement goal?
- What’s your next step?
Help if you’re stuck.
If you need help thinking about these questions, let me give you an example and then explain why this helps.
Question: What is a vital retirement goal for you? Answer: go on a big vacation at least annually.
Question: How much money do you need to accomplish that goal? Answer: $5,000 per year
Question: Are you currently saving enough money to help you have an income and have the goal you want? Answer: I don’t know
Question: Do you need to adjust your current savings to meet your retirement goals? Answer: Yes
Question: What’s your next step? Answer: Figure out how much income I need to retire. Look at what I have. Then, figure out how much extra I need to save for the annual vacation.
Here is how this will help anyone improve their prospects for retirement. This is such a simple process, and it will help kick-start the changes you may need to make to get what you want.
For most people, step one is going to lead to questions. That is what step two will help you work to answer.
Step 2 of The 10-10-10 Rule
The next 10 months: Now, consider your short-term retirement needs. The following questions will take longer than 10 minutes. Toward the end of this post, I’ll suggest how to adapt your daily or weekly habits to incorporate this step and radically change your retirement outlook. For now, ask yourself these questions:
- Will your retirement savings or income cover your basic living needs?
- Are you saving enough?
- How can you tell?
- Do you need to change your spending habits today to help you retire?
- What changes, if any, do you need to make?
- Do you need a budget?
- Are there any tax implications of your retirement savings plan that you need to consider?
- Should you be saving in a retirement account or an outside account?
- Should you choose tax-deferred, taxable, or tax-free savings?
- Is it better to pay taxes on retirement savings today or in the future?
Thinking about what you should do over the next ten months will lead you to consider what is next. What is going to be the outcome of the next ten years?
Step 3 of The 10-10-10 Rule
The next 10 years: You can adjust the time frame from a decade to whatever timeframe is necessary to bridge you to your retirement age. So, let’s jump to your long-term retirement needs. First, ask yourself questions such as:
- Will your retirement savings be enough to support you for the rest of your life?
- How can you tell?
- Have you considered healthcare costs and potential inflation?
- How will changes in the economy or the job market impact your retirement savings plan?
Using the 10-10-10 strategy can improve your chances of having a happy retirement. How do I know that? Here is why. People who want to retire are in one of three situations. They have done nothing to plan, they have done some planning, or they have done a lot of planning. Using the 10-10-10 Rule will help you self-evaluate where you are today. But, equally important, the strategy will give you a realistic view of what you need to do to improve your chances of having a happy retirement.
The problem with most approaches to retirement planning is that most of them are designed only to help people that already have a lot of money to retire. But, regardless of how much money you have, the 10-10-10 strategy will help you.
If you genuinely want to improve the next stage of your life, that is retirement; it may take changing your habits. A quote from Harry Potter and the Chamber of Secrets fits this situation beautifully. Dumbledore tells Harry, “It is our choices, Harry, that show what we truly are, far more than our abilities.”
Your choices are the sum of your habits, regardless of your age. If you are not where you want to be in retirement planning, begin by making a small change in your habits. This small change in your habits may significantly impact the rest of your life. Begin with a habit of planning. Start with the 10-10-10 Rule outlined here.
Make it a habit of working on your retirement plan a little at a time. For example, resolve that you will work on it three times a week for 20 minutes at a time. Or use whatever time frame suits you best. But don’t try to do it all at one time. Retirement planning is like the question, “how do you eat an elephant?” The answer is one bite at a time. OK, if you’re vegan, how do you eat a giant jackfruit? FYI, a giant jackfruit can weigh up to 100 pounds. Again, the answer is the same, one bite at a time.
Resources to help you improve.
You can translate that “one bite at a time” concept into a strategy for improving your retirement. Start a journal, write down the questions above, and work on it a little bit at a time. If you want to improve your habits, I am a big fan of James Clear’s book “Atomic Habits.” Besides his book, he offers many other resources on his website to help improve your habits.
I have created an excellent resource for you to help improve your cash flow during retirement called The Easiest Retirement Budget Worksheet. You can download that resource for free too.
As always, to end today, remember that this information is for educational purposes only. This information is not investment, accounting, or tax advice. For those things, you need to find yourself a good fiduciary advisor. 😉
Have a great week,
PS, here are some other great topics from my blog that may interest you.
Investing in ESG for Your Future
Does Asset Allocation Still Work In 2023?
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