October 30, 2011

What is Retirement?

I can assure you of one thing: retirement is not what it was for your parents, maybe even an older sibling. The environment that created the Sun City model of endless golf in a tract home under the desert or Florida sun is vanishing and not likely to return. Are there still folks who live like that and even aspire to that type of life? Absolutely, and there is nothing wrong with it if that is how you describe a satisfying retirement.


In large part that model for retirement depended on an employer who paid you a pension and took care of your medical bills in exchange for 30 or more years of loyalty. That model depended on a system of affordable housing that would increase in value, little by little, year after year. That model depended on a banking and investment system that believed in a fair profit but managed to keep the most greedy and immoral members of its community under check or quickly disposed of. That model depended on a government that worked, compromised as needed, and understood that we are all in this together. To create a nation of a few haves and a whole bunch of have-nots was in no one's longterm interest.


That model has been either severely damaged, if not shattered. Certainly, there will be an increasingly  large percentage of our citizens who have no real expectation of a standard retirement lifestyle. The financial meltdown has destroyed too many nest eggs and shredded financial plans.  Working as long as possible will be essential, or even desired, by many. 


For those who do plan on retiring there has been a shift in expectations. With retirement now likely to stretch over 20 or even 30 years or more, roughly 25% or more of one's life span can occur after full time employment has ended. With better health, folks are likely to stay active and vital well into their 80's. Looking forward to just sitting in the recliner, watching TV, and puttering in the garden doesn't hold much attraction for many.


So, for those whose future holds a promise of retirement, what has it become? What is retirement now? What are the basic elements that build a satisfying retirement and are, at least to some degree, under your control?


Retirement is not the end of something. It is just a change in direction.

Originally, the concept of retirement was a vision of a life of leisure and a worry-free existence. After years of toil, it meant full time relaxing with some travel and time with the grandkids for the last decade or so of life. 


Very few of us would be satisfied with that retirement lifestyle today. As noted, we probably have two or three decades of life ahead of us. Ending full time employment means we are simply entering the next stage of our life, a stage that offers as much fulfillment and excitement as we wish it to.


Our life is made up of different phases, or stages: youth and life with parents, going away to college or moving away from home and starting our own life, starting our own family while working to support that life, and now, retirement.


Retirement is more control of your most valuable asset: Time.


During the first few stages of life most of us spend time to generate income, on relationships, social commitments, and to build a particular lifestyle that makes us happy. Control of this resource is turned over to others much of the time.


When we enter the retirement stage, we are given the opportunity to grab much of that control back. As we get older, we become much more aware of the value of time, and its rapid passing. I wrote awhile back about the odd phenomenon of weeks, months, even whole years racing by much more quickly in my 60's than they did in my 40's. As I become more aware of its value, the more quickly I seem to spend it. But retirement does gives me the opportunity to be purposeful and diligent in how I spend my time. I am more likely to eliminate time wasters from my schedule.


Retirement is freedom to explore that unique creature: You

Parts of me that are uniquely me were kept under wraps in my working years stage. During that time I used certain gifts and talents I had been given to earn a living and help raise two incredible daughters. But, I felt there was more of me waiting to emerge, I just didn't know what.


When given the time and freedom of retirement I began to experiment. I tried new hobbies. I discovered the gym. I had a brief fling at bird-watching and hiking. I wrote a travel book about Arizona. But, I was still looking. I started playing the guitar. I became a lay counselor at our church with the Stephen Ministry program. All these activities were fun and fulfilling, but some part was still itching, waiting to be scratched.


For the last few years, those itches have been identified: prison ministry and writing this blog. When I retired 10 years ago I never would have  guessed either activity was in my future. But, today, they are my focus. Will they still be so at some point in the future? I have no idea. But, that is what makes retirement so satisfying and exciting: I don't know what lies ahead but I have the opportunity to find out.


What is retirement? It is a time of your life when you can take center stage. It is when you can explore all that makes you so special, a creature who will never be duplicated. Isn't that thought incredibly exciting?



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October 28, 2011

A Day Of My Retirement: How Has It Changed?

A little over a year ago I wrote a post asking, "So, What Do You Do All Day?" It generated enough comments to be in the top 10 most responded to posts of the satisfying retirement blog.. I think there is a natural fascination with how others spend their time. Especially if you are retired, or close to it, there is a real concern about how all that free time is going to be filled when work no longer takes care of 8 hours a day.

As someone who writes a lot about the importance of change in our lives, I decided to compare what I wrote 13 months ago to how I spend my time today. I would expect to notice some differences but I'm not sure what I will find. That's what makes it interesting. Let's start.


I begin with breakfast and then a quick read of two newspapers. I used to spend a full hour reading the papers but realized mornings is my peak productive time. Now, I scan the papers and am at the computer by 7:00 AM.   

OK, I'm off to a good start. I don't read newspapers anymore. That's not quite true. We get the Wednesday & Sunday papers after the company offered them for $50 a year. We use them for the coupons and grocery ads. But, I no longer start my day with two, or even one newspaper most days. Do I miss them? Absolutely not. The news was stale by the time it landed on my porch. The advertising content was far in excess of the editorial content. The weather was a joke. How someone can be so wrong with a 7 day forecast, every single day, is beyond me. The local news section was mostly obituaries. No, I don't miss the ritual of a morning paper. That part of my retirement lifestyle has changed for good.


From then until lunchtime I write, work on this blog, read other blogs, deal with e-mail, maintain my Twitter presence, and run any essential errands.

This is essentially the same for some days of the week. though the time I spent with the newspapers is now spent with a laptop. After a quick check of the news and stocks, I begin going through  e-mails. Several are the Groupon-type offers. Others are comments for the blog, requests to review a book, and, on average, 5 new Twitter followers. I must admit I am spending less time reading other blogs because this blog and writing my next book are taking up more time.

Two mornings are now taken over by out-of-the-house activities. On Mondays I volunteer at the prison ministry office for 4 hours. Wednesday morning begins with a Bible study at a friend's house with 8 other people. These commitments were not on my schedule a year ago.


After lunch is a 30 minute nap. That short break helps me maintain my energy for the rest of the afternoon. After the nap, three or four days a week I go to the gym. Like a nap, this is important to me. It helps me maintain my weight, gives me more energy, and helps keep my knees, hips, and back from causing me problems. Maintaining my health is worth this time and money investment.

This remain pretty accurate, though in all honesty three days a week is much more likely to happen than four. While my wife is often too busy for a nap, I will pay for it later in the day if I skip that 30 minutes of down time.



Then, back to the computer to answer e-mails and more writing. I try to quit by 4:00 PM. Guitar practice, a glass of wine, and it is time for an early dinner by 5:15 PM. My evenings usually include a movie, fiction reading, a little more computer work, and off to bed by 10:00 PM.


Now, afternoons tend to be when I am more likely to read other blogs I enjoy rather than in the morning. But, the writing is part of that time. I have also decided to complete household chores during the week so weekends are free for fun and family. I was finding Saturdays and Sundays were nothing but lawn work and other chores, so that changed a while ago.


I rarely do much writing or computer work at night any more. I am more likely to spend some time with the guitar, reading, and Bible study than I did a year ago. The amount of TV watching has dropped, though Netflix can be seriously addictive. Some readers have turned me on to British shows, like Doc Martin and Foley's War. I watch too many episodes in a row, I admit. Two nights a week I have commitments that take up most of the evening. Both are new to my schedule from last year.


Weekends are mainly reserved for family time and something special with my wife. I work as a mentor to recently released prisoners so some time each weekend is given over to that. I try to complete most of my chores during the week so Saturday & Sunday are kept as open as possible.

As I noted, this is more likely to be true now than it was 13 months ago. During certain times of the year, the amount of yard work, gardening, and maintenance can spill over into weekends. But, I'm making a concentrated effort to not let that happen. 


In summary, my overall daily schedule is pretty close to the one I followed 13 months ago. Frankly, I am a bit surprised. I thought I'd see more change. I am busier than I was one year ago after the growth of the blog and adding several volunteer and church commitments. Seeing my Dad once a week after Mom's death last December is part of my week, too. I think I am a bit more productive with my time. But, apparently, the pattern I have established is working well. My journey toward a satisfying retirement continues.


Whether you are retired or not, it is your turn. Think over the last year or so. Have you seen any major changes in your day-to-day schedule? Has something happened in your life that has turned out to be good, or bad to your productivity? Have you taken on new commitments? Has the economy altered your day? I'd appreciate your comments and thoughts. Like everyone else, I'm anxious to know, "what do you do all day?"


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October 26, 2011

Retirement Frugality: What Does That Mean?

The post of a few weeks ago highlighted the concern many of us have about our ability to retire comfortably, or even at all. The news has not been encouraging for quite some time. Maybe you have decided that it is time you take a more active role in making the best of a troubling situation. Maybe you believe that the people in Washington are likely to continue putting their interests ahead of yours. Or, maybe you are simply tired of being the victim and want to have more control over your life.

A satisfying retirement is built on much more than money. But, let's not be naive. Without financial resources retirement could be anything but satisfying. At this stage of the game, whatever the reason for your situation is almost unimportant. What is crucial is what you are going to do about it. But,, if the forces of the financial world are aligned against you, what can you do?

There are a few things that make sense to me. You can control your spending by controlling your wants versus your needs. You can change your lifestyle to reflect the reality you find yourself in. You can adjust your attitude to become a positive force instead of a negative drag on your life.

I can't solve all the problems. If I had those answers I'd be running for President....no, wait. Who in their right mind would want that job? But, I have experience in being fired with two young children and a wife to take care of, having a company collapse from under me, living on mac and cheese for several months, losing 40% of my IRA  and 50% of my house value in a year, and being bled dry by health care costs. I've been there.

If you have been visiting this blog for a while, you know about some of the steps my wife and I have taken to adjust to our financial reality. Look under Related Posts below if you may have missed those ideas. This time I am writing more about an attitude change rather than a list of things you can do to get your budget under control.

Wikipedia defines frugality as " the quality of being frugal, sparing, thrifty, prudent or economical in the use of consumable resources such as food, time or money, and avoiding waste, lavishness or extravagance." Since few people would want to be known as wasteful or extravagant, why isn't frugality something everyone embraces? Why is it almost a dirty word to many folks?

Like anything else, there are different degrees of frugality that range from casual to extreme. For example, I can clip some coupons, look for price match opportunities, and stock up on something when it is on sale. Or, I can become an extreme couponer, getting massive amounts of products for free or low cost and spending hours on the computer to get 100 rolls of toilet paper for a few cents.

I think frugality may have become a captive of those who are extreme in their definition and pursuit. Using both sides of copy paper is fine; using it to wrap a present not so much. Taking handfuls of sugar packets home from Burger King, probably not. Keeping the air conditioner off all summer and heating the house to 55 degrees in the winter goes beyond what is reasonable for most of us. But, I would guess that the concept of frugality makes many think of those extreme examples.

As a teacher of mine used to say, "I beg to differ." Frugal living means keeping more of what is yours, yours. It means not spending money for things you don't need and don't enjoy. It means eliminating the habits and activities from your life that take your hard earned resources and gives them to someone else. Wikipedia goes on to say, "Common strategies of frugality include the reduction of waste, curbing costly habits, suppressing instant gratification by means of fiscal self-restraint, and seeking efficiency."  All that sounds good to me. Retirement and frugality seem made to go together well.


US News recently carried a story, "The Secret to Living Well on $11,000 a year." This man's approach isn't one many of us would follow, but it makes for interesting reading. It was a follow up to "The Secret to Living Well on $20,000 a year." This fellow's life is more mainstream. It is interesting to see how frugal others can be.

So, my simple question to you is are you frugal? Are you doing all you can to avoid waste and trim your expenses by eliminating things that no longer serve you well? Are you accepting whatever your financial reality is at the moment, regardless of why you are where you are, and controlling what you can control? Have you taken a hard look at everything in your life that costs you money, time, and effort and assured yourself that whatever it is passes the test?

If so, then I'd suggest you are frugal. Wear the badge proudly.

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October 24, 2011

Social Security: Help Me Decide!

A decision everyone faces at some point is when to start receiving monthly Social Security checks. Retirement experts do not agree. The government web site designed to help you also provides no definitive answer. Like so many other decisions involved in navigating the rocky road to a satisfying retirement, you will have to make the final call.

There are several factors to consider: your financial situation without Social Security, your health, other insurance you own like long term care coverage, even your family history in terms of longevity. Disclaimer: I am not a Social Security expert. In fact, I have yet to start getting my checks. I think I have made up my mind but the only thing I know for sure is I won't start at 62 because I passed that mark 6 months ago. So, what I am offering in this post is as much for me as you. If I misstate something, please let me know with a comment or e-mail. This subject confuses even the experts, so we can all learn.


Social Security Basics:


You can start receiving a check at 62. Yes, there are exceptions that allow an earlier start, but I don't want to confuse the subject any more than it already is. You have what is known as a full retirement age, which varies depending on your birth date, somewhere between 65 and 67. You may also delay taking checks until you are 70 to increase the size of the payment. You may wait later than 70, but the size of the monthly checks doesn't increase so there is no reason to do so.

If you take your Social Security payment at 62, you will receive a monthly amount that is between 25-30% less than what you would get at your full retirement age (FRA). For each year you wait past 62 the monthly check goes up approximately 5%. If you wait until 70, your monthly check could be 75% higher than what you'd get at 62.

If you work after starting to collect Social Security and you are younger than your FRA your government check is reduced by $1 for every $2 or $3 (depending on various rules) you earn over an amount set by the government. In a rule only possibly thought up by a large bureaucracy, the money you lose isn't really lost. Starting at you FRA, your checks will be increased to make up for the money taken away during the earlier years. The exact point of this is not clear, it is just the way it is.

Spousal benefits:

Here is where things get a bit more confusing.  If both you and your spouse work, deciding when to start accepting checks takes on a new twist. You might assume it is simple: you get a check for what you are entitled and your spouse gets one to reflect his or her earnings and the age when the checks start.
No. There is a thing called the spousal benefit. If one spouse never worked he or she:

 •can begin collecting the benefits as early as age 62. However, if the benefit begins early, the amount will be permanently reduced by a percentage based on the number of months up to his or her full retirement age.

•can qualify based  on the working spouse's record for Medicare at age 65.

•can receive a benefit equal to one-half of your full retirement amount if they start receiving benefits at their full retirement age.

Wait, there's more. If you are full retirement age, you can apply for retirement benefits and then request to have payments suspended. That way, your spouse can receive a spouse's benefit and you can continue to earn delayed retirement credits until age 70.


If your spouse has reached full retirement age and is eligible for a spouse's benefit and his or her own retirement benefit, he or she has a choice. Your spouse can choose to receive only the spouse's benefit now and delay receiving retirement benefits until a later date. If retirement benefits are delayed, a higher benefit may be received at a later date based on the effect of delayed retirement credits.

And, the fun continues: If your spouse worked and is eligible for retirement benefits on his or her own record Social Security will pay that amount first. But if the benefit on your record is a higher amount, he or she will get a combination of benefits that equals that higher amount (reduced for age). It doesn't matter if your spouse starts getting benefits before, after, or at the same time you do--the government will check both records to make sure your spouse gets the higher amount.

And, finally: If one partner dies, the survivor can claim the deceased spouse’s check instead of his or her own, assuming the dead spouse’s check is bigger.

It is easy to see why this is not a simple decision, and I have left out several exemptions, clarifications, and exclusions that would only make your eyes glaze over. So, how does one decide when to take the checks? Various folks who make a living at unscrambling this stuff suggest:

If you’re still working, don’t claim benefits before your full retirement age.

If you delay taking your check until you turn 70, the break even point is roughly 6-8 years before you get back the money you didn't take in the earlier years.

 Consider your family genes and general health. How long do you think you will live?
You are better off to delay taking the checks unless you need to money to make ends meet or....

You have a solid retirement fund and the Social Security money would allow you to live a more enjoyable life by indulging in the extras of life: travel and vacations, giving money to your children or grandkids, helping a parent.

By now I assume you have figured out why the answer when to start taking Social Security is so confusing. Let me help a bit. Here is what I think I'm going to do:

Start taking payments at 64. Why? That is when I plan on starting to withdraw money from my retirement account. Social Security checks will allow me to withdraw no more than 4% year year from that account. While not everyone agrees, a 4%  annual withdrawal should mean my retirement money won't run out before I do. It will also give us extra money for what we expect to be substantial medical expenses until my wife is eligible for Medicare.

Without divulging the amount, the monthly Social Security check  is enough money that I'm not comfortable leaving it on the table every year. The difference in the size of the check between 64 and 66 isn't enough to delay the payout.

Betty's Social Security payment, even at her FRA, would be quite small. She will be better off waiting until her full retirement age, at which point she can get the spouse benefit of one-half my monthly amount.

My parent's estate is such that at some point in the future (no rush, Dad!) there will be a distribution sufficient to carry me to at least 100 years old.

I reserve the right to change the above financial plan. But, for the moment it appears to make the most sense for me to continue my satisfying retirement.

So, how about your plans?  Has this post helped you come closer to a decision? If you are already receiving Social Security, at what age did you start? Is it working out the way you thought it would?  Please share your insight, opinions, and ideas.

October 21, 2011

Retirement and Health Care Costs: Brick Wall Dead Ahead


I saw a story in the New York Times while on vacation (I know, a vacation & the NY Times?) that highlighted the results of a study done by the Kaiser Family Foundation. No longer associated with the health insurance company, Kaiser Permanente, the foundation is developing a reputation for a non-partisan source of health-related research.

The study provided fresh insight into what has become a problem with no obvious solution: health care cost in this country. As someone striving for a satisfying retirement I keep looking for some light at the end of the tunnel. So far, all I see is a train heading straight for me, and the rest of us. Consider some of the the findings of this research report:
  • The average annual premium for family coverage through an employer is $15,000, or roughly double what it was 10 years ago. 
  • Half of workers in smaller firms now face “deductibles of at least $1,000, including 28 percent facing deductibles of $2,000 or more,” according to the study.
  • A growing number of business owners are delaying or eliminating hiring because of the cost of health coverage.
  • Some provisions of the new health care legislation have added to costs without controlling increases in premiums to cover those costs.

It seems to me the health care bill had several flaws, but one of the worst was the delay of full implementation for several years. All that did was give the insurance industry a green light to raise rates as high as possible prior to the law taking full effect. I know my rates have gone up an average of 17% for the last several years while benefits have decreased and my deductible is a whopping $5,000.

This outcome was as predictable as the bank bailout producing huge profits for that industry at the expense of the rest of us. Haven't we learned anything yet about the ability of large corporations to use any loophole or flaw in a law to maximize profits?

Interestingly, the study reports that the last two years have shown an apparent slowdown in the rate increases for some segments of the industry. There is no reason given but I can guarantee you it isn't because the insurance industry has developed a heart. It is more likely that people have stopped going to doctors and dentists as often, or even as needed, so the insurers' costs are not rising as rapidly.

It could also be that the industry realizes that eventually they will be selling a product not enough people can afford to purchase to keep them in business. With somewhere around 50 million Americans uninsured, the health industry is reaching the point of diminishing returns in driving away customers.

Obviously, I have no answer to this very serious problem. The health care legislation of 2010 had the intent of reigning in costs and providing coverage for those unable to afford the out-of-control increases from health insurers and hospitals. Unfortunately, except for a few benefits for a limited number of folks, the result has been an acceleration of the problem.

What is scary to me are the number of people trying to make it without going to doctors or clinics on a regular basis and waiting for an emergency to get treatment. Then, either the costs bankrupt them, or the charges eventually get passed on to those with coverage. Much like the financial mess we are in, health care and healthy living is becoming a case of the haves and have-nots.

I fully understand the increasing role of personal responsibility for health care. Eating well, exercising, not smoking.....those are steps that everyone can take, insured or not. But, the human body breaks down. I don't care how many servings of fruits and vegetables you have each day, at some point you will suffer from a medical problem that only a doctor and hospital can address. Without adequate insurance, your life will change forever.

I believe a satisfying retirement lifestyle is in large part a matter of personal choices. Your spending habits, your healthy living decisions, your attitude, your relationships, your passions, and your acceptance of responsibility for what you can control all are things you have a major role in determining.

But, in the area of health care insurance, we seem to be on an out-of-control train. I am beginning to wonder if it has to crash completely before we  develop the collective will to find a solution that protects us and still allows doctors, health care professionals and insurers to earn a decent profit.

For retirees, pre-retirees, and frankly anyone who is above ground and breathing, it feels as if we are reaching a breaking point.


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October 19, 2011

Marriage After Retirement: What Are The Odds of Being Happy?

A satisfying retirement requires lots of pieces to fit and work together. Obviously, your financial situation must be sufficient to support you. Your health, or lack of it, will play a huge role in how much you enjoy your time after work. But, if you are asking my opinion, the quality of your marriage or committed relationship is the one factor that will be more important than all the rest in how happy your retirement lifestyle turns out to be.


There are all sorts of studies on the Internet, books in the library, experts with degrees in counseling, and your sister-in-law who will tell you what to expect. It has been said that the first few years of retirement are a lot like the first few years of a marriage: learning enough about each other to stick it out until you figure out how the game works. As Sydney Lagier said in a blog of hers a few years ago, " [It] turns out that when you spend all day with your best friend, he is going to annoy you, and really for nothing more offensive than eating, breathing, and living. She has captured the mood perfectly. Ships passing in the night are suddenly docked at the same pier.


I have written a few posts that give you some basic guidelines from various sources on how to make the relationship work. If you haven't read them, or would like to review them, see Related Posts at the end. It is generally agreed that communication and commitment are the two linchpins of  a successful retirement and marriage or serious relationship.


Rather than rehash that material, I thought I'd share some of the ups and downs of the marriage relationship that I know rather well: mine.  After 35 years together, with 10 of them as a retired couple, I have a fair amount of experience to draw on. I have no intention of telling you this is the way that will work for you. That would be foolish. All, I can tell you is about of the problems we encountered and how Betty and I resolved them (the the most part).


Timing

We discussed our plans for retirement in general terms a few years beforehand. But, the reality of what a non-working life together would mean to us wasn't seriously addressed until the last year or so. When we made the decision to pull the plug on my declining business and she was tired of pre-school teaching, the timing of that change was something we both discussed and agreed to. We also decided that when I stopped working, so would she.


That didn't work out quite as we planned. Within a year or so of my being home, she went to work full time at a department store. She hated the job, but a sudden fear that we didn't have enough money saved prompted her to agree to un-retire. That lasted a year, during which I felt guilty sitting at home, and Betty disliked the job enough that we agreed to re-retire. Besides, by then my financial phobia had calmed a bit.

Daily Routines

Being married and retired is an interesting study in balance. Each of you wants to spend time together and each of you requires time apart. Just because a job has ended doesn't mean everything else that makes up a typical day is going to change. We each have certain routines and habits that bring us comfort and happiness. Starting the day before dawn quietly reading and enjoying a cup of coffee alone may be an important part of your schedule. To lose that "me" time just because your spouse is now home could be a serious mistake. Then again, maybe you are ready for a change and would enjoy sharing cereal and conversation. 

The point is to make a change just to accommodate another person may be risky to the overall retirement experience. Marriage is a constant compromise, but sometimes your turf must be protected. Betty and I want a mix of both together and alone time. It is very important to us that we are "allowed" time to pursue solo activities and interests without feeling guilty. Even after a decade I can't report we are entirely successful in this regard. But, we are getting better at voicing our need for separation as well as togetherness. I am working at being more respectful of Betty's timing and she is getting better at telling me to buzz off.


Chores

A post from last year generated some rather strong comments (several of which never saw the light of day), particularly from men, that I had caved into the pressure to become too much of a house husband. I had earned my leisure time and shouldn't have to do chores.

Besides being downright silly, that attitude will buy you a very unhappy household. Betty and I have divided the chores for our entire married life. The only change retirement brought was I stopped traveling so I could pitch in a bit more. But, I have always done my own laundry. After all, I dirtied the clothes, why shouldn't I clean them? One of us cooks and the other cleans up. While I tend to do most of the yard work, it isn't because that is "man's work." It is simply that she can't take the heat like she used to and I enjoy the process more. Every two weeks we rotate the chore list so one person isn't always stuck cleaning the kitchen or floors. In this area things have worked well because we followed the same procedure before retirement.

Goals

This is one area where we need to do a better job: setting goals in a more democratic fashion. I will admit that most of the time my opinion wins. What I think should happens, usually does. But, over time, Betty has used various methods, both passive and aggressive, to remind me she gets a vote too.

Short and long-term goal setting is vital in a retirement relationship. Everything from financial adjustments to vacation choices, when to see the grandkids and whether we should get a new dog require a decision. Both partners need to feel his or her opinion is being considered. Both pros and cons need to be aired. I have been very good at airing my thoughts. This is a very public way to say I need to shut up more and listen harder. It will make the marriage stronger and the experience richer.




Marriage after retirement is different. But, as any married person will admit, nothing in a marriage is static. Change is continuous. What retirement does give you is the time to improve how that change is handled. If you do it well, the odds of being happy increase dramatically.

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October 17, 2011

Average or Above Average: It's Your Choice

Being average means doing what is expected, following the ordinary path or making the usual choices.  Few people decide they'd like to grow up be be average. But average is what most of us become. Don’t rock the boat, don’t stand out, don’t make waves, reduce your risks.  It is the safe choice. It is the average choice. 


I’m guessing you want more. You want each day to be special, to mean something. You’d like your life to follow a path that you create. You aren't looking forward to an average retirement, you want a truly satisfying retirement. If so then here’s my answer: ignore common wisdom. Just forget it. Common is average. Your life can be more by being different. Here are 4 things to consider if you truly want to break from the pack and create a satisfying retirement lifestyle that is under your control.


Short cuts can will get you lost. Too many people think they have figured out how to get something for nothing. Hard work is for other people. The path to glory and greatness lies through other's efforts or money. Don’t bother perfecting your skills. Don’t waste time learning what you need to know. Look for the easy way to your goal. Look for the shortcut.


Just don’t be surprised if you find yourself in a forest with no easy  way out. I am afraid there are no shortcuts on the road to a non-average life. You have to want that life enough to be willing to work hard for it. There is no bypass on this road. You see the sign for the shortcut, and choose the other path.


Experts often know less than you. Our society worships experts. If someone is an expert, whatever he or she says must be right. It is certainly better than what you think or believe. You can save a lot of time and worry by just doing what they say, buy what they think is best, and live how they have determined is best.


Bunk. An expert is often self-identified. That label may not be backed up by a track record or experience. That person has no idea what works best for you in your unique set of circumstances. Is it possible that maybe you are the best expert in figuring what is right for you? Stop blindly listening to every "expert" talking head. Start listening to yourself more. After all, you are more than average.


Newer isn’t always better. Isn't it true that we sometimes upgrade, replace, or redo out of boredom with the old? Commercials have convinced us our life will be a whole lot better with the latest.... whatever. Newer is always better. Our clothes will be whiter, our teeth brighter, and our home life more pleasant if we just replace this with that.


I don't believe that. Today’s appliances are made to fail, whereas the stuff from 20 years ago would last forever. Getting most home appliances or electronic equipment is impossible. You will be told it would cost more to fix something to just replace it. 


But, guess what? Sometimes you can resist that siren call and be just fine. Computers will work years after Microsoft wants you to upgrade to Windows 10 or 11 or whatever. Often all those updates do is make your other equipment like printers or disc drives obsolete. With decent care, your car can easily go 125,000 miles or more and be fully paid for. But, to resist the constant call to buy what is new and improved takes above average will power.


You can’t spend your way out of debt. This is not what our consumer society wants you to do. In 2006, back before our last one (or is it now two) recession the average household spent 133% of what it earned. I haven't seen any more recent figures but I’d suggest there is a very direct correlation between that kind of mindset and the economic mess of of the last few years. Our entire average way of life is built on  credit for housing, cars, giant TVs, vacation, just about everything. Waiting is just so..... unnecessary. 


Sometimes credit is helpful and necessary. Few of us can buy a home with cash in our checking account. The problem arises when we attempt to fund our day-to-day lives with credit we can’t pay back. Suddenly your life is out of your control. Decisions you make are predicated on how you can balance this bill against that credit card, against that obligation. Your entire lifestyle can collapse in a week or two if you lose your job. The solution seems rather obvious. But, with the average American household having total credit card debt of $15,000, apparently not.  


Do you want to be more than than average?  Do you see the flaws in the 4 ways of thinking and acting listed above. Do you have the desire to excel and exceed expectations. It does take above average will power, determination, and a clear vision of what you want to accomplish. You will have to ban average from your vocabulary.  


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This post is supported in part by Reader's Digest Canada: 8 tips for saving money


October 16, 2011

Can You Go Home Again?



With apologies to author Thomas Wolfe, my question really is "will home still feel like home when I go back?" It has been 10 years since Betty and I have been to Hawaii, and probably 14 years since we have been to Maui, well before the beginning of my satisfying retirement. That is a long time between visits. It would be normal for there to be changes on Maui, and what my reaction might be. 


For over 20 years I had visited Hawaii at least a dozen times. Some trips were for business, some with family, and two of them alone to decompress from business. When our daughters were growing up we celebrated two fabulous Christmas holidays, learned to scuba dive together as a family, snorkeled, saw whales, and created lifelong memories. During every one of those visits I would step off the plane, feel the breezes and smell the flowers and scents in the air, and feel like I had arrived home. I can't tell you why Hawaii, and Maui in particular, felt so comforting. But, it did. During the long time between visits I occasionally felt the pull to go back. But, a few trips to Europe, two long driving excursions, and the addition of a son-in-law and grandkids kept my need for the islands at bay.


About 6 months ago, while planning another driving vacation, I suddenly realized I really needed to come back to Maui. I needed to find out if it was the place that had so engaged me. With Betty's quick agreement we had the planes, car, and condo booked in a few days. Time passed and in late September we were back "home." I was both apprehensive and eager to discover what had changed. Would I still feel that pull? Would the island magic grab me as strongly as it did when I was younger? Would Maui have changed enough over the intervening 14 years that I didn't bond to it like I once did.


For the first several days, it seemed as though things were different. It wasn't that Maui had changed much but apparently I had. The instant strong feeling of past visits wasn't there. It remains amazingly beautiful. True, the airport felt partly abandoned. At least half the 30 gates were no longer being used since Aloha Airlines went out of business several years ago. Some wind turbines had sprouted from a hillside to take advantage of the constant breezes. A new highway or two made travel a bit quicker. Food and gas prices were astonishingly high. But, the Maui of 1997 was little changed from what I found in 2011. 


That must have meant I had changed. Was it simply being older with deeper roots in Arizona? Was it a widened range of experiences collected during the trips to Ireland, England, and Italy? Was it the amazing hassle that airline travel has become? Was it not needing whatever Maui once supplied me with? Was it that since my last visit I had retired? I had no idea.


Then, on the 5th day, as Betty and I drove from our condo the old feeling returned. There wasn't any one thing that triggered it, just a sense of peace and relaxation that has always been at the core of my stays on this island. It was as if the intervening years had not passed. 


Things looked and felt familiar. Lahaina's Banyan tree is still the center of the town's life. The Saturday morning art festival under its shade continues in full swing. The harbor at Maalaea had added several new buildings, but Buzz's restaurant was right where I left it 14 years earlier. The windsurfers just past Pa'ia were busy defying gravity and waves, while the surfers cut through the water with tremendous grace. The road to Hana was every bit as twisty and upcountry every bit as beautiful. Tedeschi Winery remains one of the most peaceful places I have ever been.


Even after all the previous visits this special place held some surprises. For the first time we watched the Maui  Fair parade, all one hour of it, with floats, bands, fire engines, clowns, every Boy Scout and Girl Scout on the island, and amazing high school-aged acrobats. We sat for a delightful afternoon while watching the Maui Polo Club (seriously!) play dozens of chuckers (games). 


The sunsets at the beach park just across from the condo were as spectacular as any we have seen anywhere in the world. Because this time of year is off-season for Hawaii we were happy to find fewer cars on the road and fewer tourists on the beaches. We approached each day with no definite plan and no agenda. Time seemed to slow down and each day felt well-spent. Betty was content taking hundreds of photos each day while I read, relaxed, and kept an eye on the blog comments.


The only real change in my reaction to Maui was my long held desire to live here for three or four months each year. The distance from family and the sky high costs have made that dream not reasonable for now. Also, there is a definite feeling of disconnect being on a small island in the middle of the Pacific. By the time I woke up and had breakfast, the stock market was about to close for the day. Football games start at 8 AM Sunday morning and are all over by lunchtime. In talking with a few of the locals, it became obvious they have little interest in what is going on in the rest of the country or world. In fact, if surf is up, it seems as though virtually every person under 30 is on a board in the ocean. Their universe is this island. I can see how it would be too easy to slip into that mindset when you are 2,500 miles away from the nearest land. I need fresh challenges and to be part of the whole.


Can you go home again? Yes and no. I was happy Maui has remained the special place it is and I could feel comfortable being there after such a long absence. But, I had changed to the point where I treated it like a well-deserved vacation rather than a prelude to living there for part of each year. Will I ever go back? Probably. Two or three weeks seems just about right. But, if I don't go back I will have learned what I needed to know about this place and its part in my life. 


My satisfying retirement has completed another chapter.
                   



October 13, 2011

Retirement Concerns: New Study Takes a Look


Having a Satisfying Retirement has never been easy. But, there is no argument that the last several years have made it even more of a challenge. It is hard to read anything about this stage of life that doesn't spell out all the difficulties are face. 

A week or so ago I was given the results of a bipartisan, national survey. Conducted by Lake Research Partners and Public Opinion Strategies, it shows widespread anxiety over having the means to maintain a comfortable standard of living throughout retirement. It shows that anxiety continues to grow, with near universal concern about having enough to make ends meet throughout retirement. The poll was commissioned by Americans for Secure Retirement (ASR), a broad-based coalition of more than 70 organizations committed to raising awareness of policy issues related to retirement security.


“What we’re seeing is significant, and increasing, concern from Americans of all political stripes about falling short financially during retirement,” said Bill McInturff, founder and partner of Public Opinion Strategies. “Not only are Americans concerned about their own financial health, but they also express widespread concern over how the continued contentious debate in Washington could further undermine what they are planning for in retirement. Even those who feel we must make dramatic cuts to deal with the debt think Congress needs to identify concrete ways to help Americans deal with further retirement instability.”


The survey reveals pervasive anxiety over how efforts to reduce our national debt may impact retirement security. Regardless of party affiliation, the majority of voters are concerned that cuts to Medicare or Social Security would have too significant an impact on retirement or that, if cuts are made, Congress must look for other ways to help Americans better plan for retirement. A majority of respondents also expressed support for proposals such as tax incentives to help save for retirement.


Additionally, the poll findings include:


88 percent of voters expressed concern about “being able to maintain a comfortable standard of living throughout retirement,” with 52 percent of those individuals indicating they are “very concerned.” This is up 15 percent from just last year.Concerns about being able to maintain a standard of living in retirement are extremely high across very diverse demographic groups: 


White (86%)
African-American (88%)
Hispanic (96%)
Those without any investments (93%)
Those with over $100,000 in investments (84%)
Financial elites (81%)
Retired (81%)
Not-retired (89%)


A full 50 percent of voters believe lawmakers should not cut Medicare or Social Security because it would have too significant an impact on retirement.  A plurality of Republicans and Tea Party supporters (34 percent of self-identified Tea Party supporters, 39 percent of Republicans) and the majority of Democrats (62 percent) express this viewpoint.


88 percent of voters view tax incentives to help save for retirement as important. This includes 81 percent of Tea Party supporters, 83 percent of Republicans, 86 percent of Independents and 94 percent of Democrats.


“Continued economic uncertainty, high unemployment and instability in the stock market have placed a growing concern on retirement security, and it’s an issue that transcends party affiliation,” said Celinda Lake, President of Lake Research Partners. “As all eyes turn toward the 2012 election cycle, it’s clear that fears regarding retirement security will play out big not only for Democratic voters, but even the most conservative of Republicans as well.”


“We commissioned this poll to illustrate the overwhelming anxiety that exists about having the means to live comfortably in retirement,” said Shannon Hunt, Executive Director of Americans for Secure Retirement. “As policymakers look for ways to address our national debt, they must find ways to generate peace of mind among Americans as they look toward retirement. Promoting solutions that provide guaranteed lifetime income – for example, annuities –would go a long way toward balancing these concerns.”


The poll was conducted as part of a national omnibus survey of 800 registered voters. The survey took place from September 10-13, 2011. More information, including a detailed breakdown of the poll results, can be found by clicking on this link.



What I find important about this survey is the broad-based, non-partisan approach to data gathering. Frankly, I had never heard of the Americans for Secure Retirement before, but am  impressed with the diversity of groups it represents. If you are interested, a list of the groups included is available here.  The only obvious caveat: the life insurance industry is well represented in ASR. Therefore the recommendations for annuities is to be expected. But, to their credit, all sorts of folks were interviewed, including those with no history of investments or ownership of insurance industry products. 

Over the past 17 months I have written thousands of words that the path to a satisfying retirement lifestyle is based on so much more than just solid financial planning. I continue to firmly believe that to be true. Strong relationships, focusing on your health, feeding your passions and creative side, travel, even working after retirement are part of the package.

But, for many the effect of the economic mess we are in is beginning to drown out some of that message. While I am not sure what the new reality of retirement should mean to this blog. be aware I understand we are seeing a shift in attitudes and it is important that I reflect it.

At the same time,I am encouraged when I read stories like this one. A lady suffered substantial losses, tried to be upset and bemoan her fate, but couldn't do it for more than 6 hours! She has done what she needed to do, has adjusted and moved on. It is an affirming story that I urge you to read.



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October 11, 2011

Mom and Dad want to Move in With You. Now What?

I've written about the effects of having an adult child move back home. There are adjustments and the need for an agreement on topics as varied as loaning versus giving money, charging for room and board, an agreed-upon end date for such an arrangement, an the importance of treating the returning child as an adult.


Another "move-in" situation that I have yet to address is  becoming more common. It is also much more difficult since it tends to be long term with major commitments in time, effort, and expenses: having a parent or two move in with your family. PR expert Ginny Grimsley, sent me the following from David Horgan,  a gentleman with plenty of experience in this area. I felt it worthy of your attention. I pass it along to you, with a few minor edits.


When Your Parent Moves In

There is a rising trend of parents moving in with their adult children. All across the country unexpected problems that arise from this living arrangement can cause family arguments, financial stress, even increased divorce. The arrangement can also be enriching, a strong statement of love for parents from their grown children, and a lesson in responsibility. 

Before moving a parent in and making a life altering change to the family harmony, there are many things to consider. Inviting an elderly parent to move in has far reaching implications on every aspect of your life, from financial impact to changing family dynamics, from role re-assignment to safety issues, from power struggles to eroding privacy. 

  • Be Open: Have a clear and open discussion with your family, siblings, spouse, kids, and ultimately your parent(s), to decide if making the move is the right decision for all parties involved.  Discuss:
    1. The pros and cons
    2. The different ways this move will effect the family
    3. The ways each family member’s routines may be disrupted. 
    4. Expectations that may differ from “the way things have always been”
    5. Any possible monetary issues that could arrive
    6. Compromises that each family member will have to make
  • Medical Management: An elderly parent is apt to have a litany of doctor appointments, medication, and needs.
    1. With the help of medical and geriatric care professionals, assess your parent’s medical needs and gain a clear understanding of how those needs will affect you and your family.
    2. Gather all possible medical resources, containing both specific people and organizations, to minimize frustrations as well as possible mistakes.
    3. Use your support network to create and implement a plan as well as back-up plans. 
  • Moving Day: Moving is stressful under any circumstance. Moving in an aging parent entails a permanent lifestyle change and one that may be met with resistance, which can make it even more difficult. Plan for every detail upfront to minimize the potential strife.
    1. Ready yourself for possible volatile emotions and flaring tempers from all parties.
    2. Use your utmost compassion and support when you decide what stays and what goes.
    3. The move may not have been a parent’s first choice. Avoid sweeping decisions, such as throwing away Grandma’s 50 year-old collection of National Geographics, without discussing it with her first. 
    4. Decide ahead of time on furniture placement.
    5. Make a disbursement plan for who gets items that cannot fit into your house. (Storage, give away, other siblings.)
  • House Rules: Your parent is used to running the household with his/her own rules. Everyone must openly acknowledge that each family member must compromise to make the new living arrangement successful. It is important to create a plan that is respectful to all parties, so your parent doesn’t feel slighted and uncomfortable as the “newcomer” to your home. You also want to make sure that you and your spouse do not feel like outsiders. Decide on:
    1. Chores
    2. Who waters the plants and feeds the cat etc.
    3. Who helps and who doesn’t help in the kitchen
    4. How you like laundry done
    5. Bathroom etiquette
    6. What you make for dinner and what time
    7. When are lights out, and television off


The economic reality is that your, or your partner's, parents may not be able to afford a retirement home, continuing care community, or even a well-run nursing center. As Mr. Horgan points out, there will be changes in everyone's life that could last years. As the parent declines, nursing care will become more of an issue. This is not an issue with easy answers. But, it is certainly a good idea to work out as many details as possible ahead of time. There will be enough stress as it is.

I'd be quite interested in your comments, especially if you have had to face this problem, either as the adult child or the parent who moves in. Your experiences and feedback will be quite valuable to us all. If you'd feel more comfortable sharing anonymously, that is perfectly fine.


My thanks to David Horgan, an award-winning medical educator, filmmaker and director from CaregiverVillage.com. he has written a book that provides his firsthand account of what to do, what not to do, and what can happen (the good and the bad) in his book When Your Parent Moves In. Mr. Horgan is also Media Director for Project-13, a non-profit drop out prevention program in Holyoke, Ma that reaches inner-city kids through film and music production as well as practical work experience. http://www.whenyourparentmovesin.com/


October 9, 2011

Be Careful: It's a Scary World On-Line

The Internet is probably an important part of your life. It is quite possible you pay some of your bills on-line. You certainly visit blogs or you wouldn't be reading this. You may stream movies and TV shows over your laptop. In all likelihood you look at pictures of your children or grandkids on line.


Believe it or not, close to 50% of all those over the age of 50 are involved in some form of social media, with Facebook being the clear leader. Over 70% of adults between 50-64 and over 40% of 65+ folks use the Internet on a regular basis. The average Internet user spends a whopping average of 37 hours a month logged on.


So, all that use means we all feel comfortable with the Internet. Not by a long shot.The Internet may have become a part of our daily life, but many of us are worried about the dangers that seemingly lurk everywhere. The top worries are actually quite similar across most ages, Only children show a different set of concerns, mainly centered on those who prey on kids, or cyber bullying. But for the rest of us, see how many of these worries make your list. Don't completely despair. I'll give you some basic steps to help protect yourself.




Fraud. This can cover lots of territory. You order something that never comes and you can't contact the seller because they have disappeared. Maybe you sign up for what you think is a legitimate credit card offer only to discover the whole thing is a scam to steal your important information. Lotteries are a serious problem for some seniors. They look so good and sound so easy, until you hit the send button. Even legitimate web sites can involve  a form of fraud: you sign up for something that you need or want but find out there are other charges for other services you never agreed to.


Stealing your Identity. Of course, this is form of fraud but one that can cause immense problems. It can take years and cost of thousands of dollars to clear up the mess left when some bad guy pretends to be you long enough to wreck your credit and  leave you with thousands of dollars of unpaid bills. The problem with this type of Internet crime is you often have no idea it has occurred. It might take days, or weeks, or even months for the theft to come to your attention. You go to swipe a credit card at the food store and it is denied. You check and get the bad news. Everyday we seem to read about an  endless parade of companies that announce millions of personal information files have been lost or stolen. Does that include you?


Draining a checking or investment account. Often linked to your identity theft, few things can be more terrifying than looking at your stock broker or bank statement and finding the money gone. A life's worth of savings can be stripped from you in seconds. While many safeguards are in place, they are not foolproof.


Personal Information collected. Usually the purposes are legitimate: to properly identify you as the person you claim to be or to make your on-line experience more satisfactory. But, in other cases, you wonder why they need this information. Many larger merchants will ask you for your e-mail address when you buy something at the store in the mall. Giving someone the last four digits of your social security number sounds pretty safe. But, by knowing where and when you were born (available on the Internet with very little effort) the person suddenly knows the first three numbers, too. Randomly generating the other two is something any decent computer can do in a few seconds. The government collects information about you continuously. Google knows more about your Internet and shopping habits than your spouse. That grocery store loyalty card gets you hamburger for 40 cents less a pound but gives the store detailed information about what you buy.


So, what can you do? No steps will protect you from everything. Too many people are spending all their time inventing new schemes. But, there are some  things you should do to help swing the odds a bit more in your favor.

Basic Steps to protect yourself from the big bad Internet:

  • Change your passwords often and don't use the same one for all accounts.
  • Make the passwords unusual: a combination of letters, numbers & symbols
  • Don't keep a copy of your passwords on your computer.
  • If your computer suddenly starts running slowly it could be infected. Immediately run a scan.
  • If on a social network, set the privacy settings to protect important information about you
  • Don't put anything on the social network that you don't want the world to see.
  • If using Internet Explorer upgrade to at least IE 8. Set security to at least medium
  • Use Private browsing in IE to prevent web sites from tracking you.
  • Delete browsing history, temporary files, and cookies on a regular basis.
  • Examine all bills closely for unexpected charges.
  • Run a free credit check every 4 months (with one of 3 agencies) to catch problems.
  • Don't open e-mails from someone you don't know.
  • Never respond to an e-mail that says it is from your bank or credit card company and needs to verify some of your account information. They don't send e-mails like that, ever. Neither does the IRS.
  • Make sure your computer's anti-virus software is running and up to date.
  • Sign off from the Internet when you are done. Don't leave the computer connected, regardless of how safe the site is.
  • If you are using a wireless connection, secure it. People driving or walking by your house can use your WiFi connection. Same rule for coffee shops. Those wireless networks are not secure. Never do anything that involves important data or private information over a public WiFi network.


The Internet is a tremendous tool for learning, entertainment, staying in touch, and managing your affairs. But, it is largely unregulated and open to bad things done by bad people. Be alert, follow the basic steps above, use common sense, and you should be just fine. 


Do you have any experiences to share? Have you been a victim of some on-line scam? Is there any other safety hint you'd like to pass on? Now is the time.


A safe place to go on-line is the purchase of my new e-book, Building a Satisfying Retirement. I'd appreciate your support. Click here for more information on how to download the book.




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