Don’t be fooled by your retirement plan.
It may contain an excellent asset allocation and distribution strategy. Estate and tax planning are top-notch. Your retirement location is ideal.
What’s missing?
The most crucial component. How to manage the gradual decline in all aspects of both your mental and physical health.
The breakdown of your body starts much earlier than you think. A new study shows that declines in strength, cardiovascular fitness, immune response, and cognitive processing begin while most people would still consider you technically healthy.
Maintaining their Peakspan should be on every investor’s mind. Take a look at this eye-opening chart showing the decline in capacity across various cognitive and physical functions.
Peakspan is defined as the age interval during which an individual maintains at least 90% of their peak functional performance in a specific physiological or cognitive domain.
Most people spend most of their lives in a healthy but declining state. This condition is called a functional gap.
While all of this sounds depressing, knowledge brings power.
The slope of the decline rests upon habits rather than genetics. In addition, not all functions decline at the same time. Fluid intelligence (The ability to learn new things) starts to decrease in your 20’s and 30’s. Crystallized intelligence ( The ability to process information through experience and memory) doesnt peak until your fifties or later.
The goal isn’t reversing time. It’s all about staying as close to your peakspan for as long as possible.
This revelation brings us to investors’ retirement plans. They are not worth the paper they are printed on if maintaining peakspan isnt the chief retirement goal.
After all, what good is your money if you can’t move or get around in tremendous pain?
Cognitive impairment is even worse. It’s difficult to complete your bucket list when you don’t even recognize your wife and family.
Don’t get me wrong, bad stuff can still happen despite maintaining optimal sleep, eating, stress management, and exercise regimens.
Just like investing, it’s all about probabilities—your odds of mitigating the decline in peakspan increase significantly when you do these things. Focusing on what you can control is always the optimal strategy for increasing your wealth and maintaining your wealth.
As I get older, I tend to dwell more on observing the absurdity of human behavior.
For example, how people panic over snowstorms and shark attacks but pay no attention to the real danger, their lack of movement, sleep, and all the processed garbage they shove into their mouths daily.
For investors, it’s the same dilemma. Diverting valuable bandwidth to when the Strait of Hormuz reopens is not an optimal use of precious time.
The same goes for being an expert on the percentage of emerging market stock you may hold and their small deviations from their assigned percentage allocations.
In the big picture, the only goal that matters is maintaining your peakspan so you can enjoy the fruits of your labor in your golden years.
What are you doing about this?
If the answer is nothing, you have a lot of wood to chop. Burn this chart into your brain.
Lengthen the curve, my friend, you won’t regret it.
