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Wednesday, October 9, 2013

Ask Arlee: How Can I Afford to Retire?

Retirement (Photo credit: 401(K) 2013)
     Talk about serendipity!   Or was another blogger and I on the same wavelength?  Whatever the case may be, I was quite surprised when I began compiling the current "Ask Arlee" post and went to visit the blog of Gracie who had posed some interesting questions for me back in February.   Since I was going to use Gracie's question I decided to visit her blog to see what was going on with her.

     First off I was surprised to note that she had not posted anything since July.   At least not until Monday's post at In Search of a Title.  What a thoughtful beautiful post it was.  In her post Gracie expresses some concerns that more than one of us share to some extent or another.  After you read my post I encourage you to visit In Search of a Title and give Gracie some encouragement in return.

How Can I Afford to Retire?

 In my post of February 25, 2013 Graciewilde said...

How can I afford to retire? I need stupid heath insurance but I want to free myself from the stupid daily work grind. I like my work (most of the time - but I want time in my life to read, to write, to hike, to paint, to be, to travel - oh yeah, that costs MONEY! Answer me that :)
So I want to know what you did. I think I blew it already by being the responsible (read: good) parent and refinancing the house to pay off student loans for two offspring - good for them but now I am tied to house payment when I had been within six months of paying if off.What did you do? teach me!

       Oh Gracie, you don't want to do what I did because I didn't do much as far as retirement goes.  I wanted to have a good time in my younger days and do the things that fulfilled me the most.   My show business career allowed me to have some great experiences, live comfortably, and do something that fulfilled me.  During those years I had plenty of time to do all the fun things that you say you'd like to do and when I was working I was doing something I loved.  I did not, however, put away much of anything for retirement and what I did have I blew on business investments gone bad after I got off the road in 1991.

       If you like your work enough then make the best of it while you can and be thankful that you have that job.  After I lost my regular job in 2009 I thought finding a new one would be a breeze.  Boy was I wrong!  I had enjoyed my job in the 18 years I worked there even though it provided virtually no benefits for retirement or health insurance.  Call it another bad career choice, but the job served me well in many ways during that period of my life and it was something I enjoyed doing.  I miss that job!

       Outcome of that story is that I didn't find anything suitable and started collecting social security which doesn't get me far.  I felt forced to retire, but I can't really afford it.  Thank goodness my wife still has a good job with benefits.  I'm looking for new opportunities, but so far--nothing.

         One thing my parents taught me was if the money's not overflowing don't pay for your kids' college. I paid my own way for the most part and I didn't take any student loans at that time. When my own kids got out of high school they had to do like I did when I was their age.  I didn't have the money to pay for schooling for them so they were on their own for the biggest part of the venture.  I helped where I could, but all three had to make their own ways in life and they've been doing pretty good so far.

         My big dumb mistake was that I took out a student loan to finish my own degree.  Since I had my job at the time, paying off a loan didn't seem like such a big deal.   A few years after I got the stupid degree I lost my job and the degree wasn't any help in me finding another one.  My B.S. in Business Management was a lot of B.S.   I don't regret the degree, but now I'm saddled with a student loan that will take a few more years to pay off with me getting my pittance of a social security check.  

         So, Gracie, from what I know about you from your blog and comments you have left me, it sounds like you have a fairly decent job and you need to try to enjoy it as best you can while balancing out your free time doing things you love and spending time with family.  It's too late to teach me anything, but I could have learned something from your experiences.   We can pass on what we have learned in life to our kids or other younger folk, but will they listen?    I sure didn't listen to a lot of the advice I was given when I was younger.  But do I regret my decisions in life and get depressed about my current state?

          There's nothing we can do about our past other than accept it and try to find all the best parts of what our lives have been and put them to good use as memories or lessons learned or however we want to refer to them.   No point in worrying ourselves sick over yesterday or tomorrow for that matter.  I like to subscribe to the Matthew 6:34 philosophy.  You can look it up, but essentially that very wise verse advises us that worry is unproductive and we need to focus on today.  If we worry ourselves sick in mind or body then what good have we accomplished?

           Sure, I know it's pretty simplistic, but why should we fret over things that are not even guaranteed?  I don't mean to neglect things like health, retirement, or where we'll get the money to pay the bills.  It's important to do some sensible planning.   But we can't count on anything in this world.   We can look at affairs in current society and see that plans can be dashed in a short matter of time.  Some people who have saved for retirement may not be as set for comfort as they thought.  The whole economy could crash for all we know and then what would all of our slaving and worrying of the past be worth if that time comes.

          For me I might not have much, but I'll have had a lot of years of great memories and experiences and a life that had a pretty decent quality to it.  For you I hope you find the best things that your life offers now and savor them.  I know you have plenty to be thankful for and if you focus on those positives then the other things you want in life will fall into place naturally.  


7 Reasons to Be Happy Even if Things Aren’t Perfect Now (from the Tiny Buddha blog)

1. Enjoying the present moment is a habit that takes practice.
2. Finding reasons to be happy now can benefit your future
3. Tuning into joy can improve your health
4. Consistent, long-term happiness depends on your ability to notice and appreciate the details; you can hone that skill right now. 
5. Every day is a new opportunity to be better than yesterday; that pursuit can increase your self esteem and, accordingly, your happiness.
6. You can be who you want to be right now, no matter what your situation looks like.
7. Finding joy in the present moment—no matter how inadequate it may seem—makes a difference in other people’s lives.

(To read more about these visit Tiny Buddha)

         What good advice would you give to younger people about the future?  How do you cope with uncertainty and difficult times?   Do you think that you will be able to afford to retire?   How are you planning for retirement?  

         If you are already retired, are you enjoying your retirement?   What advice would you give to those facing retirement? 

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  1. You're so wise Lee, I love your advice here and think that it's all actually applicable too. I think it's tough for somebody, not even a young person, but just somebody who's caught up in the moment and the bills at the current time to plan for their retirement because it feels like more important things are always up next on the pipeline, great advice though, I'm going to have to keep this in mind myself.

  2. My wife and I enjoyed life for a while. Then it suddenly hit me that we needed to plan for retirement. We're fortunate that we started planning early enough that we'll be fine in ten-twelve years and I can retire early.
    And planning early means start planning now, because it's never too late.

  3. I am retired and on the whole have enjoyed the traveling I have done. Can't say I've enjoyed certain things in my life happening but they happened and one can't turn the clock back.
    Planning for retirement these days is essential,Being widowed before I retired I did have a bit put by from my husband's certainly helped.

  4. I find it hard to give others advice as I don't feel I know enough about life to give it. Your advice is brilliant and I hope Gracie.

    I've told my son as soon as he can he should put money away for his pension, if he doesn't want to work until he drops. I know how hard it is to save in this day and age as there seems to be too many things to spend your money on.

    I'm lucky, because I'm in a position where I'm following my dream after years of working hard and going without to enjoy my time now, and all thanks to my kind husband too.

  5. I took my sons to the bank so they could open their first Roth IRA accounts when they were 18. Wish I had done the same when I was 18, but Grace is right - health insurance is the reason folks continue to work. We would love to retire early, but it all depends!

  6. It IS the insurances in my life that prevent me from retiring. I went to college late in life but like you I now have to pay those loans. I signed up recently for loan forgiveness since I work in a school district. You have to pay on your loans for ten years and then the remaining balance will be forgiven--if they accept you in the program.

    I agree it's never too late to start saving even a little for retirement.


  7. Yeamie -- I don't know about wise, but I do know stupid. The problem with stupid often is that we don't recognize it when it's happening or don't want to think about it. I'll admit to being stupid in many ways, but then again maybe being stupid in a world gone stupid won't matter that much anyway.

    Alex -- Plans can always fall through. Investing in the future these days is like buying a product that has a lifetime guarantee and then the company goes out of business. What we have been told and led to believe may not be valid in years to come.

    Yvonne -- You've been fortunate to have been able to take advantage of the programs set out for you. I'm not so sure that future generations will have this same good fortune.

    Paula --Enjoy your situation while you have it because things can change. If I had taken the advice you gave to your son, I'd be doing okay right now. If the economy collapses though that money could be gone. There is always some risk and we never know for sure.

    Yolanda-- The health insurance is one of the big things that keeps my wife working. Plus she'll have some added benefits if she stays until her official retirement. Besides, she likes her job and if she weren't working she'd probably just be blowing money. If I had a decent job presented to me now, I'd gladly take it.


  8. Teresa -- I'm not eligible for the loan forgiveness so I'll have to pay mine. And I am now spending my retirement. I hope some money will eventually come in that can go back into savings, but it may not so I know I can't count on it happening.


  9. I was one of many who had a deadend job and wanted to retire and was afraid to because the corporation I worked for took good care of me. As it happened, my healthy spouse took sick and I realized there was absolutely no reason to be at my office when I could spend his last precious days with him. So I retired early. He's gone now but I absolutely have no interest in returning to work.
    Before he died, we did the opposite of the OP, I changed my home loan so I could afford the payments on one salary. So yeah, I have to pay for 10 more years, but at least it's not a big payment.

  10. Lee, that is one of the nicest, wisest posts I have read anywhere for a long time. I'm sorry that you're in the spot you are now in but it sounds like you have the right attitude. I'm sort of where you are now. I never ever thought I'd be out of work. I was at the top of my game in the newspaper world, making good money, getting great benefits. When I was a young reporter I never would have guessed that the newspaper business would die within my lifetime. But there it was... at age 52 I got "a package" and there aren't any other newspaper jobs to go to. My experience means nothing anymore in that world – and guess what? I'm TOO OLD for most other jobs (except the Wal-mart greeter) and too inexperienced in every other profession! Like you, I have a spouse who supports us, thank gawd. I guess I'm retired... and I guess that's good, but it's something I didn't necessarily choose so it's a bit off-putting.

    Sorry to ramble... and hugs to you!

  11. I am not saying that a person shouldn't try to plan in this economy, but we don't know what the future holds. I think of that line from Van Zant's song Help Somebody... "If you want to hear God laugh, tell him your plans."

    I think Tiny Buddha has it right. Life really is all about appreciating each moment as it happens. If we can find the joy in now than our lives will be joyful.

  12. What I want to retire from is getting up every morning between 5 and 5:30am.

  13. My parents have talked about moving to Costa Rica since the cost of living is so low. I think that's a growing trend these days.

  14. Mimi -- Sacrificing for others, especially for those we love most, is the ultimate thing that any of us can do in life. I think you did the right thing. Life is short, but love expanded from each of us throughout all of those with whom we come in contact has a big impact on the world.

    Cathy -- Thank you so much for this comment. In many ways we are kindred spirits in our situations. I found the same conundrum when I lost my job. Overqualified, but under experienced and too old to make an investment in. Over thirty years in management left me with little in the way of marketable skills. Feel free to ramble here anytime.

    Robin -- Love that quote. We should make plans and have certain expectations, but the only thing we can really count on is that most of them rarely turn out as we thought they would.

    Andrew -- I may be "retired" but I still get up at that time every morning to fix my wife her breakfast and see her off to work. And even when she's on vacation I tend to still get up early. Old habits are hard to break especially as I get older.


  15. Jay-- After my past summer vacation to Ecuador the thought has crossed my mind. Still I'm not sure that I'd want to leave my family and friends that far behind unless I could afford the travel. I'm not sure that the cost of living will be the biggest issue as the future comes. There may be greater complexities to consider politically, socially, and economically. The world and the influence of the U.S. may be changing in big ways in the years to come.


  16. It was not so long ago that between working and maintaining a house, there was very little time left for hiking and painting...the whole concept of a work/life balance is a relatively new one.

    I'm not that old, and I remember a time before microwaves and washing machines and dryers, and cable TV with a zillion channels and phones that are not attached to your kitchen wall.

    While I empathize with Gracie, I echo Lee's comments.

    If you are working in a job you DO NOT HATE, which puts you well ahead of a good percentage of people on this planet.

    I'd like to be able to do a lot more of the things Gracie mentions, but have the same trouble finding the time.

    But on my most stressful days, I keep in mind how much better my job is than so many others I hear about.

    I also doubt myself-would I really keep busy if I retired or would I turn into one of those people who seems to care about those idiot guests on most daytime television shows?


  17. One other thought to any reader who is young and working for an employer with a savings plan and match.

    Do not make the mistake I made. I did not contribute for almost six years when the company matched your first 6% of contributions with 0.50 on the dollar.

    My excuse was I could not afford it.

    The truth-I couldn't afford not to.

    I might be retiring early had I contributed during those years.


  18. Great post Lee thank you and for the tiny buddha wisdoms.
    I often think of my late father, who had a very secure job but who resigned from his company at the age of 63, 2 years before retirement and all the perks he would have received, in order to follow my mother to another part of the country. I remember his putting in his application for a position in a company in the place my mother had now relocated to - that company was looking for man of approx 35 yrs old. He was hired, moved .. and worked until he was 70. For me an eye opener to not be tied into a company only because of pension etc ...
    Do the work you love no matter how humble it is ... life is too short for otherwise.
    Attitude is all -
    And always important to not spend more than one earns etc ...

  19. Try being self-employed. The last time I got a report from Social Security, letting me know how much I'll earn when I "retire," I laughed. I make that doing one short speaking gig now.

  20. Larry-- I guess you know what you're talking about when it comes to retirement and investments. Despite your late start I'm sure you've done far better than most of us in your retirement planning.

    Susan -- I would gladly take the right job if I encountered it. I enjoy working--in my retirement I probably work just as much as when I had a regular job. I think spending more than one earns is a common trap that many people fall into in our era. Credit is too easy to come by and much easier to abuse when one gets it.

    L.Diane -- Self-employment was part of my problem leading to where I am now. For many years I was considered an independent contractor and during a few of those years I reported very little if any income. It's a good thing that I had the job that I had as my last job. It helped boost my social security check.


  21. I just retired this year but I wouldn't have been able to if my daughter hadn't received a big scholarship to college. We paid for our children's college, working extra jobs, and doing without a lot of things we wanted at the time. It was exhausting but worth it to give them an easier time in this difficult economy. The good thing is that they also worked hard to pay for books and everything extra and now they all have great work ethics and appreciation for the benefits of education.

  22. My retirement plan went to crap when the Mayans blew it. Now I'm back to cheering for coronaries and/or meteor strikes.

  23. Hi. Lost my job in 2010 and decided to retire. Fortunate for me, my husband still has a good job. He retires next year. We did dabble into the home equity though for college loans and material needs. I do regret not paying off the house. It is our only debt, but that's income we could have had. Finanaces look sound now with pensions and social security, but one never knows. I agree though we can't stay up nights worrying about it. You do the best with what you've been given, save for a rainy day, have faith--and I would add--help those we can.

  24. Susan GK-- I think it's wonderful what you were able to do for your kids. I wish I could have done more for mine, but I think they understand and appreciate the things I did do for them.

    CW -- Sometimes I think in those same terms, sometimes not. It depends on what kind of weird mood I'm in at the time.

    Sharon -- I'd like to be able to help others. We're saddled with our house payment, but we're trying to work it down before my wife retires. Life can be very unpredictable that's for sure.


  25. Hubby and I have been retired for a long time. The first years we spent in North Carolina where we really enjoyed our lives, after 12 years we came back to Canada, life is still pretty good although pensions don't pay for everything we would like to do. Living in Canada we are lucky with health care and not only that hubby has an excellent insurance from his previous employment.

    However, I do think that if you can save something towards your retirement you should definitely do so. There are always things you want to do or need to have that pensions just won't stretch to.

  26. Great post, Arleen. I think the advice you end with is very true. We can plan the best we can, but mustn't forget to enjoy life as it goes on. Shucks, I wish I could retire *now* and I'm nowhere close to retirement age - I just want more time for writing (and reading and other hobbies)!
    But I've been following the blog of this Canadian couple that are doing their best to retire at 45. Very interesting!

  27. Jo - You and your husband are among the lucky ones. I don't know if future generations will be able to enjoy the same type of retirement that you and your husband have enjoyed.

    Deniz-- In some ways I feel like I experienced some of the benefits that retirees have when I was younger and working on the road. It was a great life that allowed me to do a lot of things that most regular working people don't get to do. Even after retirement comes there never seems to be enough time to do the things we want to.


  28. Hey,

    I'm a card-carrying member of the enjoy-life-now party, and have - for the most part - no regrets, but as a stay-at-home Dad, I am officially "unemployed," so I do hope I can sell a few books before I retire!

  29. The advice I'd give kids today is to put off college until they knew what they wanted to do and decided that a college degree was either necessary or would help. Too many kids are going into college without a clue as to why they're there and get degrees that they chose because they were at the end of their second year and they had to decide on a major.

    I'm not old enough to collect Social Security, but I'm out of work and legally can't take any of the money I saved for retirement until I turn 65 without paying a massive penalty, so I'm out looking for work again. Them's the breaks...

  30. Retirement is not in the near future for my husband, so hopefully we will have everything paid off and have enough saved when the time comes. When my son was younger we used to joke with him that he needed to get a good job so he could take care of his mom and dad in our old age. Sometimes I wonder how close to the truth that really is.

  31. No matter your age, it's scary to think of retirement.

  32. Mark -- I'm all for that party and all of civilization falls to crap tomorrow then I don't care how many retirement plans you've got unless it's a bomb shelter stocked with food and supplies and even then will it matter?

    Sound -- I agree with you about college. Going to college has been somewhat overrated and now more than ever. These days I might give trade schools more of a recommendation. Trades can't very well be outsourced.

    Susanne D. -- It's not that much of a joke. We may be returning to the day of extended family units living together under the same roof and kids caring for their parents. It's already happening for many.

    Nicole -- I think we as a society have made retirement scarier than it should be. And government probably should stay out of it for the most part.


  33. Some great advice, Lee. I'd rather save my own money then trust the stock market or some company's 401k program.

    I agree, though, I think we should all do some prep work for the future. I work with a guy who's 70y.o and -has- to work because he has no other income. I don't want to end up in that boat, for sure.

  34. I recommend that people start thinking about long term care insurance while they're young and healthy. It will come in handy if you or a loved one ever needs to go into assisted living or a nursing home.


  35. When I recently quit my job to write full time, I gave up both health insurance and a retirement plan. In some ways, it's the dumbest thing I ever did. On the other hand: I'm so happy. I think it's even worth all the uncertainty to be living a life I enjoy.

  36. Mark -- I might be "that guy" some day. I've made no preparations.

    Julie -- Getting "put away" to be under care is very expensive.

    Kelly -- All of life is uncertainty. Even for those who are certain that they've got retirement covered.



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