Congressional leaders are playing a dangerous game with their constituents\’ money, their livelihoods and their retirement savings. On Wednesday, all Congress did was flip over the hourglass on a game of chicken that cost our economy $24 billion and left America\’s future up in the air — and, by doing so, may cause some of our hard-earned retirement savings to disappear into it.
Archives For retirement
I had to discover a passion for retirement because I had worked all my life at something that I was not passionate about. I understood that in order to discover a passion I had to understand who I am. Figuring out who I am was not complicated, but it required time and effort. It took a lot of mental work, the hardest kind of work. It took a lot of experimenting and trial and error, the scariest kind of work. But almost anyone can do it. You don’t have to be a monk, priest, philosopher or psychologist. You don’t have to have a college degree.
The above quote comes from a fellow blogger Bob Lowery over at Satisfying Retirement a few days ago. It was a guest quote from Boyd Lemon. I was very surprised that it didn’t get the usual number of comments for that site. Several things in the post struck me as almost profound in their wisdom. Particularly the quote above. Sometimes I write a post that I think has at least at some level a profound message only to see that it gets a minimum of views. I don’t understand why?
As I have faced lately, I have finally come to admit that I was probably in the wrong profession throughout my corporate years. I blame the indecision to admit that early on and do something about it at least in part to a lack of guidance counseling in my high school years. I went to a very small high school in the 1960s so I understand the lack of guidance. I hope that is not the case today but I fear that it is.
One of the most profound responsibilities that a parent has is to help their child learn their ingrained passions and talents early in life. If appropriate counseling is not available in the school system then it should be sought elsewhere. When a person is passionate about what they are doing they are much more likely to make a difference in this world and isn’t that what most of us end up wanting? To make a difference.
But of course I realize that most teenagers think they know it all and would probably resist this type of guidance. Forming young minds is probably the most noble of all professions and guiding them to listen and learn about their compassion is one of the most critical things that you can do for a person.
It is not that I didn’t have a fulfilling life in the occupation I ended up in but instead it is more of a road not taken type of thing. I will always wonder if I had recognized earlier on what I felt strongly about if it would have been even more fulfilling?
Thanks Bob for doing the guest post that got me to thinking about this….
I know the source article says basically the opposite of what the title is. That is because I think the article is, at its foundation, wrong. It wouldn’t hurt almost any of us to take a lifestyle cut now or even in retirement. I know that my wife and I are now living on a little over half of what we spent but prior to my retirement. We moved from the “high cost” State of New Jersey back to my roots in Indiana. We quit buying much of the things we bought before and to tell you the truth we are living a much more happy life in the process. I have fallen thoroughly into the mantra of “Simplify, simplify, simplify….”
The U.S. being a capitalist society teaches us that if we want our country to prosper we must continue to spend and consume more as each year passes. If we don’t our businesses will die on the vine or so they say. The problem with that is that for most of us working folks we make little if anything more in income than we did twenty to twenty-five years ago. So in order to consume more we have to buy it on credit. Being good little citizens many of us now have $10,000 or more in credit card debt and often times a second or even a third mortgage on our houses to pay for our ever spiraling spending.
I think it is time for us to get out of the “spend more this year than we did last year”. That is especially true for those of us who are now living in our retirement years. We should have learned it much earlier in life but we should at least now know that having more and more stuff does not insure a happier life. In fact I have found the exact opposite to be true.
So even though I trust my friends at Fidelity Investments to manage my retirement saving I did indeed take a lifestyle cut in retirement and am having a ball. If only I had learned this secret much earlier in life. My country is going to have to somehow figure out how to prosper without my increased spending…..
Ravages of the stock market. The people Redmond encounters most who are lacking sufficient retirement savings weren’t necessarily delinquent or negligent. Many had money saved but were wiped out by the sour stock market in the past decade and poor investment strategies, Redmond says.
That’s what happened, in part, to Robert and Connie Cabana of Tampa, who are both in their 60s. Robert built up a sizable 401(k) working as a financial executive at Verizon. Connie was a business assistant for a local irrigation supply company. Connie was laid off four years ago; Robert was let go three years ago.
But the serious hit to their retirement, which wiped out half their 401(k) savings, resulted from the stock market and an overexposure to risky stocks, they say. Now, 75% of their 401(k) is gone, and they have “very little” left, Robert says
I can remember in the early 1990s wondering if I would have enough to retire on. Fortunately for me the 1990s Clinton era was a prosperous one. My savings more than doubled during those years. I was never one to take a lot of risk so I was pretty much unaffected by the dot.com melt down that occurred in 2000 as I got most of my savings out of the markets before that happened. But I did have a friend that insisted that the “good times” would go on forever. He, like the people in this article, lost a good portion his 401(k). I haven’t heard from him in years. I wonder how he and his wife are making out in their retirement?
I can remember the stories from the pundits about how people are not prepared for retirement throughout all my adult life. First there were the oil embargos of the 1970s then there was the savings & loan fiasco of the 1980s followed by the melt down of the dot.com era and now due to deregulation the near meltdown of our entire financial structure. But this is the first time I have seen times remain as dreary as they have for more than ten years now. I can see the “malaise” has grown exponentially since President Carter’s famous speech. Maybe if we had actually listened to President Carter and freed ourselves of dependence on foreign oil back in the 1970s we would be in much better shape today. Who knows what that alternative history might have been if one of our past presidents had been brave enough to make that happen! Who know how many young lives would have been spared if we didn’t need so much middle eastern oil?
Will any future generations ever be prepared for a secure retirement? It’s hard to say. About the only thing you can do is keep putting a little of each paycheck back and hope for things to get better. There is not much else an average guy can do.
Let me start of by saying that I am by no means an investment professional but that doesn’t keep me from having an opinion. And I will also admit that looking backwards is a lot easier than looking forwards, especially in money matters. That being said there is something to saving for retirement the old fashioned way and that is to save the money while you are in your income earning years. Fortunately I retired just before the dot.com bubble burst. I had already moved much of my savings into more, some might say very, conservative areas that were somewhat unaffected by the coming down markets. I was more fortunate than many of my follow front-of-the-herd baby boomers in that regard.
It seems that, especially during the boom years of the Clinton administration everyone was betting their retirements savings on doubling or tripling via the stock market’s constant upswing. The feeling was “if I can just put $10,000 into the stock market it will be worth $30,000 to $40,000 in a few years. Many people were planning on retiring with the new found wealth in the their forties instead of waiting for the usual sixties.
And then came the Bush years of stagnation. When Mr. Bush came into office the stock market was right around 10,500. Now more than ten years later it is at a little over 11,000. that make for an annual percentage basis of about 0.3% annual gain. If you had bought $1,000 worth of U.S.Savings Bonds in January 2000 it would now be worth $1500 or the same amount of profit as your $10,000 would likely have gained in the stock market over the same period of time.
I know all you financial advisers out there are saying “what you say might true be but these are unusual times”. To that I say over the very long term you might be right but this has been going on for almost twelve years now. To many that is well over one-third of the earnings years and there seems to be no reason to believe that things will change any time soon. Given the vitriol atmosphere in the congress now there is little reason to believe that your government will ever be able to help bring back prosperity even if they could in the first place.
So, here we are again back to the old-fashioned way. If you want to be more assured that you will be able to live comfortably in your senior years you are going to have to give up some of the “stuff” you deem important today. This includes things like that $3 cup of coffee, the vacation home, the $300 monthly budget for new clothes, and the new car every three years. Instead put it away for retirement. It doesn’t seem to matter much where you put it; if putting it in your mattress makes you feel secure then put it there. Just put it aside where you can’t get to it too easily.
One of the things that we let our corporations get away with is shedding any responsibility for their employees future well being. The company pension plans of my generation are long gone now so the only thing you can be assured of is the social security you will receive. It will be the only thing that will provide even the most basic safety net. And, no I don’t think we U.S. voters, especially us senior citizens, will allow anyone to take that away. But then again what do I know
The title to this post seems to be more frequent the last few years. When the kids are grown and out of the house (sometimes those are two totally separate events ) then Mom and Dad make the announcement that they will no longer be living together. This often comes as a shock to the kids but maybe it shouldn’t. When Mom and Dad got married twenty-five or more years ago they were at one state of their lives. They had fallen in love and that alone is an overwhelming experience.
But as the years progressed Dad took an interest in certain things and Mom took an interest in certain things and they were just not the same things. In other words they grew apart. Maybe Mom turned into a resolute homebody who totally enjoys puttering around the house and her garden and plans to spend the rest of her life in that mode. But Dad moved in another direction. He is more into traveling and seeking new adventures and the “stay-at-home” life is unthinkable to him. As Mom and Dad grew older they knew they are growing in different directions.
And then comes a life milestone to make them realize they have different priorities. For some that time might be as mentioned above when they become “empty nesters” but it also might happen when they retire. It may come when their parents die and they get a strong sense of their own mortality. But at some point Mom and Dad realize they are very different people than when they were newlywed. Put simply, they have different overriding priorities for the remainder of their time on this earth.
So the logical conclusion is to go their separate ways. Some do this and maintain a close friendship with their spouse; for some the separation is more stressful. Many can find some sort of compromise to avoid this state entirely but for some the wants/needs for the future years is just too different. So, if your Mom and Dad want to get the family together for an announcement don’t be too surprised if the above is the topic of the conversation.
And the journey continues…..
I have discovered another nice blog about retirement. It is http://retiredsyd.typepad.com The blog is called Retired Syd and is by a young lady (at least by my standards) who choose to retire in her 40s. She was an accountant in her working years. I didn’t realize accounting paid so much that you can retire with less than twenty years in the business! Maybe that fact would help one endure the boredom of all the number crunching (ha). Anyway, Syd is now on my regular view list. She definitely has a way with words. More power to her. I retired more than ten years ago while I was in my early fifties so I guess I didn’t wait much longer than she did.
In one of her recent posts (I can’t seem to find it right now) she cited a statistic that about 60% of those entering retirement thought they had mostly accomplished what they set out to do in their work life. Less than 25% thought they missed what they set out to do. After reviewing that post I asked myself the same question. Did I accomplish what I wanted during my working years?
Forty one years ago when I started in the corporate world I really don’t think I had much of a plan of accomplishments. It seemed more of a day-to-day thing to me. I didn’t say things like “I will do this for eight years and then I will do that”. I have always been a planner but I guess it was always about the short term stuff. So, to answer the question that Syd reported, no I didn’t accomplish what I set out to do as I didn’t set out to do anything. I know today kids seem to have so many more possibilities for their lives than I did. I just didn’t see that when I was supposed to be planning my life in the 1960s. Looking back I know now there were several opportunities that I would have liked to have had but that is called “Monday morning quarterbacking”.Don’t get me wrong I did accomplish some pretty significant things in my life and I am proud of them but none of them were planned before I started.
Here I am starting my second decade in retirement from the corporate world and the same thing seems to be happening. I have not had a long term goal for my retirement. Instead it has been a day-to-day thing. But that is not bad in and of itself. I am not just drifting through life but it seems I do just let it come at me and then I make my choices. In the Bible Jesus tells us to not be focused on the past or to worry about the future because God will take care of that. Instead he wants us to live in the day. That is not such a bad way to do things, at least not in my mind. It is the choices we make day-to-day that really determine who we are and what impact we have on the world.
And the journey goes on…
Retirement is not a onetime thing; it is a long term process. In earlier years when I was preparing for retirement I deemed it pretty much that event where I left the workforce and collected my virtual gold watch. But after that ceremonial event is when the real thing takes place. I must admit I struggled with just what to do for the first year or so of my retirement. I finally decided that I really didn’t want to fully retire so I ended up opening a woodworking cabinet shop. That lasted, to one success or another, for about six years and then I moved on to other things.
Basically retirement, among other things, is a period of experimentation. I made certain decisions and then changed them to something else as the years have progressed. If something didn’t work, and many things I tried didn’t, then I moved on to other things. Don’t worry that you may make some wrong decisions. You almost certainly will make wrong decisions. To me that is part of the retirement process. It is great that at this point in my life what I do is up to me (with my hubby’s permission of course ).
In the ten years since I left the corporate world I have been into several different things. I am now gladly in the full retirement mode. That is I no longer take money for what I use my time for. One thing that has remained constant during these years is my volunteer work. I have spent a couple of days a week giving back some of the blessings the Lord has showered on me during my life.
My latest thing is building a slot car track. I am going to fill the room which used to be my cabinet business paint shop in the back of my barn with a slot car layout. I considered model railroading but that just seems to boring for me (ha). In the Spring I may just migrate on to remote controlled trucks. I am eyeing a place behind the barn to build a track for those.
And the journey goes on….
One of the problems I have faced with retirement is the question “Where are the milestones?” I have up until retirement gauged most of my life by its milestones. They go something like this:
- Starting School
- My first communion
- Becoming a teenager
- Getting my driver’s license
- Graduating high school
- Deciding on college
- Being able to drink “legally”
- Graduating college
- Getting my first full time job
- Getting married
- Getting my first promotion
Ok, so now I am at the last milestone on the list. What comes next? What is there to look forward to now? I have viewed my whole life around milestones. As I was progressing through these milestones retirement was always the last one on the list. When I entered retirement the main question was “Now what??” Yes, I had dreamed about not having to get up every morning and give the better part of my day to my employer. Even though I enjoyed most of my employment years this was still on my mind. I did go through a period in my early retirement years where “now what?” really started depressing me!
So what came next that I didn’t foresee beyond this list? Of course that is up to each of us to determine. For me a big part of it is”Giving Back”. Even though I have had my share of hardships I was always aware that there were many others who had it much worse than I did. I was deaf but what about those who were both deaf and blind! I couldn’t imagine who they coped! I always had a good paying job. What about those who were not fortunate enough to have gone to college or the many who rode the employment/layoff cycle throughout their lives. Some at times struggled just to put a simple meal on their family table.
So a big addition to my milestone list is helping other who do not have it as good as I do. I spend a considerable amount of my time now giving back. These are some of the most enjoyable moments of my life. Of course there are also things like traveling and hobbies but in my mind although they are fun they don’t deserve a milestone category rating. I have a few other milestones on the list now but they will have to wait for a future post before I reveal them. Of course the obvious final milestone on my or anyone else’s list is going to meet my maker. But I guess I am like most people I really want to go to heaven but I don’t want to have to die to get there :)
And the journey goes on…..
I think most investment advisers are actually in the “anti” retirement business as they scare us out of it by insisting that the you need as much income in retirement as you did before! They actually seem to be discouraging us from thinking about actually retiring! But then again they make their living taking a “small” percentage of your money in the process of fixing your mistakes and getting you ready for your retirement years! I guess that needing as much money after retirement as before might be true to some who have maxed out a bunch of credit cards, failed to pay off their mortgage, or didn’t put saving aside before their leaving the work force. But I can say that after six years of semi-retirement and four of full retirement I have not spent nearly as much as I did before I retired.
- our homestead was paid off
- I no longer need two reliable vehicles. I now drive a twenty year old truck.
- buying clothes and other such things is almost a non-existent thing for me except for socks and such
- although gasoline has increase pretty dramatically during that time I use much less of it now.
- I have always paid off my credit cards on the due date
So I find myself living on about one-third less than I did before. and that even includes a substantial amount of traveling. One thing that has increased dramatically is health insurance. My retirement insurance keeps increasing the co-pays and out-of-pockets.
I know the advisers all say you need a well-rounded portfolio in your retirement years. To them that usually means letting them constantly shift you from one stock or fund to another, for a fee of course! I know a good friend who thought he had a “well-rounded” retirement fund in 1988 and ended up losing a big chunk of it in a drastically falling market that year. Then when he got most of the losses back he proceeded to lose them again in the markets of 2000! Given that the markets haven’t done much in the last ten years I suspect that he is still waiting for retirements. I don’t think we should count on making the big bucks in stock profits to finance our retirement years. I believe it needs to be done the old-fashioned way by saving it. That doesn’t mean that I am not in the market, I am but not to the degree that the investors would advise me to be. I guess I am a fairly conservative guy but it has paid off for me over the last twenty years. I’m not saying that all retirement advisers are of no value. You just have to watch them almost as carefully as you do your assets they are controlling.
And the journey goes on…
Yeah, I’m probably pretty typical of a retiree in that I have read several books on what to do in my retirement years. To be quite frank none of them have been terribly useful to me! But that does not mean they were not worth reading. They did incite me to think about various things. Most retirement books are pretty generic: Get a hobby, enjoy the simple things, adjust your spending…. But there are tidbits of useful information out there. Just don’t expect a paradigm shift as a result of reading a retirement book.
One of the things that retirement books seem to emphasize is to stay healthy. As if I really had a choice in that regard. Yes, I do go to the YMCA three or so times a week. But most of my health problems are related to past life choices not the ones in my retirement years. So, as far as I am concerned that is a horse already out of the barn (if you understand rural analogies that is). I live with the health I have. I don’t really have much choice in that matter now. Of course “good health” is really a relative thing.
Another thing the books do emphasize is to stay busy. I certainly agree with that. But I think it is up to each of us to determine how best to do that. I don’t think anyone can really learn how to do that from a book. I enjoy writing and journal keeping so blogging was a nature for me. I also firmly believe I should show compassion for others so volunteering my time in this area was also a natural. I enjoy U.S. history so traveling around the country is also my thing.
It is up to each of us to sit down and decide what are your priorities in your retirement years and then make it happen. Sitting back and doing nothing should not be an option as it would be a very dangerous one. The only thing I would advise is to be sure you get outside of yourself. Look for opportunities where you can help others with your available time. I guarantee those will be the most rewarding moments of your retirement years. Concentrate on others not yourself.
The picture here is of one of my signature country cabinets I made for several customers in my semi-retirement years. Building cabinets and furniture was very enjoyble but after six full years of doing it, it was getting a little boring! That is one nice thing about retirement, you can shift gears whenever you want. After six years I packed up my woodworking tools and moved on to other things.
Don’t get me wrong, I have found my retirement years to be some of the most enjoyable of my life.
And the journey goes on..
One thing I haven’t mentioned yet about this blog is that it will be much about retirement living. Yeah, I know you are saying “You are in retirement and still don’t know what you want to do when you grow up?” Well, that is just who I am I guess! I retired, or I could say I was retired, from the corporate world ten years ago by a down sizing. I think the Hong Kong company that bought our corporate division just wanted to get rid of all the higher paid old people and I was included in that group. I must say that at that time I already had my thirty years in the corporate world so I welcomed the layoff money and the full pension that followed. But that is a story for another time.
When I was downsized I decided move back from the East coast to my roots in the Midwest and open my own cabinet/furniture making shop. That lasted with some degree of success for about six years. I have been in the full retirement mode for the last four years. Switching from a sixty hour a week corporate job to retirement is quite a transition! I handled it, or should I say I muddled through it, as I expect many people do. There was a lot of anxiety, many things I was just not prepared for, and some successes. I will be going into much more details about all this in the posts in the coming months. It has been quite a journey but I think much is still ahead. I am pretty well settled in my life now but I still have a lot of antsy moments so am constantly seeking changes.
The picture above was one of my signature items when I was fabricating furniture. I designed and built it over twenty years ago for my wife. It was quite a successful item in my product line.
And the journey goes on….