July 24, 2013

What Is A Retro Retirement? Are You a Candidate?

Originally posted two years ago, I thought those of you who weren't part of the satisfying retirement family would find this worth reading and commenting on. I have updated as needed.


I'm sure you have seen the headlines: a bare bones satisfying retirement lifestyle requires at least $1 million. If you want to maintain your standard of living and keep up with inflation you need at least $2 million in retirement savings. And, on and on. It is enough to scare you into staying on the job (any job) until you drop dead of old age.

I have a different viewpoint. Remember I am not a financial adviser, just an average guy who has been a retiree for 12 years. The financial professionals would probably tell me I'm full of it. I am 62 64 years old. When I am 72 or 82 it is possible I'll look back on this post and decide I was full of it. But, until then, let me make a few points that might bring you some comfort: your retirement savings doesn't need to be anywhere near those lofty levels. The idea that you must have at least a few million socked away before considering retirement to me is nothing more than a scare tactic. How can I say that? Experience. My experience.

There was an article in Canada's Financial Post a week or so ago, written by Gary Marr entitled, "Try the Retro Retirement." He made the same point that I have made several times on this blog. There is a way to live a very happy, satisfying retirement lifestyle that doesn't require huge sums of money. It doesn't deprive you of pleasure and excitement and happiness. You don't shop only at thrift stores and eat beans and rice every night for dinner. You can vacation where you choose. You eat meals out and go to movies. You own a car. You dress well and are healthy.

How? By living under one simple rule: instead of worrying about how much money you need, base your lifestyle on what you have. That is worth repeating: instead of worrying about how much money you need, base your lifestyle on what you have. Determine what your life will look like on that reality and live accordingly. Instead of following the siren call of ever greater expectations and wants, be content in how people used to live in retirement: comfortable with what was available.

Do you play golf? Fine, but do you have to play at Troon North in Scottsdale where a round in season tops $250 dollars? Not as fancy, but golf at a municipal course may cost $45.

Do you want to travel in an RV? Great. Do you need a 45 foot super unit, or is a popup camper a better fit for you?

Do you plan on gardening more after retirement? That is rather inexpensive if you don't recreate the Hanging Gardens of Babylon. How about exercising? Walking at the mall or around your neighborhood is free. Weights and exercise bands cost less than a month at the gym. Maybe you like the gym with all the equipment, pool, and sauna. Fine. It is cheaper and better for you than doctor visits due to poor health.

Play with the grandkids? Free. Go out to dinner with friends? No problem, but does it have to be at the steak house that charges $50 for 6 ounces? Have you ever considered a potluck at your house? If it is good enough for schools and church, why can't it work at home?

I guess it all comes down to your expectations. And my experience is they change the longer you are retired. The dreams of cruising the world, jetting off to spend the summer in Italy, or having a vacation home in Aspen begin to lose their luster as you age. Why? Because priorities change. Time with family and friends, giving something of yourself back to the community through volunteer work, a new passion for writing or biking or gardening suddenly become more important to you than spending spring in Tuscany. This approach is simply a conscious choice to live a mostly frills-free retirement.

Certainly you can decide that working longer or harder, or gambling on riskier investments so that you can have the baubles, the vacation home in the Cayman Islands and a new car every year would make you happy. Then, you will need a $4 million retirement fund. Just don't be surprised if the tricked-out retirement lifestyle wears thin after a while and you find you aren't as happy as you though you might be.


Life on the front porch with an iced tea. The way it once was, and can be again.

Or, you could approach retirement more like your grandparents did: a time to savor life, use your talents and skills, and strengthen your relationships. Live life with the money you have, not with the money you can only dream about.

I wager you will be happier. Want to bet?

42 comments:

  1. You nailed it here, Bob. And with that kind of attitude, saving is so much more effective. BTW, my gang does golf for $30 or less (do I get bragging rights?). :)

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    1. Actually, at this time of year it is possible to find greens fees in the Phoenix area at some municipal courses for $10. The major resorts are still charging closer to $100, but that is quite a bit better than the $250 they get during high season.

      I'm willing to bet you are not playing in 105 degree heat, so $30 does get you bragging rights!

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  2. A very comforting post. We just spent 4 days in Pine, sitting on our decks,reading,relaxing,taking walks, and enjoying the animal parade on our property. A simple retirement sounds like HEAVEN. Your wise words are a reminder that it doesn't take as much as we believe to "live the good life!"

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    1. I was thinking about you a few days ago since I hadn't seen any comments recently. Betty and I were just down the road from you on Monday and Tuesday: we were at a friend's home in Payson enjoying the rain and decidedly cooler temperatures. Pine is a perfect place to be in July.

      Living the good life is so much about attitude and so little about money.

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    2. We had a long trip Back East to see relatives, some of whom are ailing. Not much internet access. Caught up with everyone. May need to make a trip back soon. But now, Back home and up in the mts. a lot. Your posts are a lifeline!! We're waiting for sale of practice,Ken pretty settled with our retirement plans now.. it's been a long haul and I am sure we will continue to enjoy tips and hints when we make our first steps... we're also coming up with contingency plans if the bus. does NOT sell by our time frame in early 2014.

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  3. Perfect timing for this post! I've had an interesting couple months; I've been helping my daughter & her Aussie (Australian Shepherd) move in with us, & I made three trips to Western Colorado from coastal California in five weeks because my uncle passed away. I am SO grateful I am retired & could do these things; at the same time I feel like I lost that time & obviously our finances took a hit because two of the three trips were unplanned. I'm doing a retirement re-set & realizing that our finances will be much tighter for the next couple of months & that I have the power to make that more than ok, rather than struggling with someone else's idea of how much money we "should have" or how time should be spent. I also have some time now to catch up & get my time management plans back in order.

    I won't bet with you; from my perspective you're right.

    pam

    ps-I missed you while I was in Colorado. I don't have a fancy smart phone & had no internet access. That was actually a good thing overall, but I haad a lot of blog reading when I got home!

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    1. Wow - a rough couple of months. You are so right that retirement gives you the chance to do what you did and then put all the pieces back together again. Welcome home.

      BTW, Betty and I will be at an RV resort in Paso Robles for 4 nights during our California trip in October. I hope we have the chance to share a cup of coffee!

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    2. Would LOVE to see you when you get in the area; let me know which dates when the time gets closer & if there is anything you'd like to do or see while here. We do live in a great location....& hopefully the weather will cooperate.

      I'll be reading you (& occasionally commenting) until then & will see you then!

      pam

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  4. I like to think we all finally 'get it' by the time we reach retirement. By that I mean, understand it's not about 'things', it's about simplifying and enjoying life. Often the simplest pleasures are free!
    Great post!
    b

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    1. The simplest pleasures are not only often free but the most satisfying. Thanks, Barb.

      BTW, are you at your vacation place on the Jersey shore? How has the weather been this summer?

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    2. Yes, we have spent most of the summer here at the shore. We do go back and forth fairly regularly, but usually just for a day. It's been unGodly hot this summer, but it's usually about 10 degrees cooler here, so it's a help. We haven't had to turn the a/c on yet, and I'm grateful for that. When I can't have all the windows open I don't feel like I'm at the shore! That's why I would never last in Arizona...not a fan of a/c.
      b

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    3. We have very good friends who bought and live in a famous old resort in Phoenix for the past thirty years without air conditioning. Granted the thick walls, fans, and evap coolers help, but there are days when I don't know how they stand it. There is a window AC in the master bedroom so I guess they spend many hours there.

      But, without AC I wouldn't be here!

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  5. I've never really had expensive tastes, so the idea of basing my lifestyle on what I have is very fitting. Cayman Islands? My mother lives on Galveston Island, and that's enough beach for me. Fancy little expensive sports cars? Most are manual transmissions, which I have consciously avoided learning how to use. 45 foot house on wheels? My recent trip in a 22 footer proved that bigger is not always better - 25-30 feet will probably suit my needs just fine. Caviar and champagne? Don't like either one LOL

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    1. I see that you will be retiring soon and plan on traveling extensively with your RV. I have found RV travel to be a very rewarding experience and something I plan on doing for years and years. My wife never wants anything bigger than our 30 foot Class C. A 40 foot bus on wheels? Not for us.

      Oh, by the way, champagne makes me hiccup.

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    2. Oh..so Cari in North Texas is now LadyTexan! I'm glad to see your picture.

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    3. I'm pushing 60 and retired 4 months ago after 34 yrs of nursing. I've always had to live a lifestyle based on what I had. Few people in my circle had new vehicles every year and vacations outside of the country (never mind vacation homes). Consequently retirement seems like easy street - a comfortable pension income and freedom. I think about the next generation with their sense of entitlement, not having lived through a "recession" yet, easy credit, vacations out of the country 2-3 times a year. I guess I need to quit thinking about it and just enjoy my retirement and life experiences.

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    4. I think there are two very different generational groups behind us. The 40-55 year olds will be paying directly for the mistakes of our generation and the lack of political will to resolve our serious problems.

      Then there are those who are in their 20's-30's. They are going to inherit a very different world and have very different attitudes when they get to be our age. The idea of not working will probably be both impossible and unthinkable.

      Enjoy your retirement!

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    5. Yeah, I accidentally selected my Google account name as my "reply as" so that's why the name change and the picture. It's easier that way, so I'll probably keep using that name, and just put Cari in the text. That's good to know that you and Betty like your 30 foot RV, that may be my final choice.

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    6. We both would probably opt for a slide out next time to give us more room in the diming/living area. But, 30 feet is plenty long enough.

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  6. Like some of your other readers, I've lived my whole life based on the idea of living on what I have, instead of worrying about how much money I need . . . and it's served me well. Btw, where's that street in your photo? It looks nice. I want to retire there!

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    1. That is the street of your dreams!

      Actually, it is a photo I purchased from an on-line source so I have no idea.

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  7. Thanks for reposting this, Bob. It is such good, solid advice -- and much more realistic for most people than the $1 million target. -Jean

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    1. A million here, a million there...pretty soon you are talking about real money!

      We humans can be pretty good at adapting to what reality presents to us. As several comments have mentioned, the key is working with what you have, not what you want.

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  8. Well said.
    Priorities change and it is good.
    My encore life is as slow paced or high geared as I wish it.
    My husband continually asks me to get a new car. Why? My convertible can take me where ever I need to go-- with the wind blowing through my hair.
    We talk about a trip abroad or two...but I think a chairs at the sea side will be more enjoyable.
    Making "ends meet" means that you find out what the ends are and meet them at the end of the day. The freedom that allows is amazing.

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    1. I like your idea of figuring out where your "ends" are and making them meet. That is certainly less stressful than trying to stretch those ends in a way they were never meant to go.

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  9. I can't tell you how many retirement calculators I tried, trying to reassure myself that we were indeed OK to retire. What I finally realized is that depending on the calculator, the assumptions were quite different, and did not necessarily take into account that we are capable of adjusting as we go along.

    The lifestyle factor is an important one. I am grateful that my husband and I see eye to eye on this. We are both pretty content with our life as we have created it; full of life experiences, as opposed to things. It's interesting to reflect back 30 years ago to see how our perspective has changed over time.

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    1. A typical retirement calculator assumes there is a "correct" answer. That is a wrong assumption.

      Being on the same page as your spouse or partner is vital. There is nothing that can turn a retirement unpleasant more quickly than not agreeing on your asset use.

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  10. Jumping in again here with the reminder that a good network of friends is crucial, IMO, to a satisfactory retirement. But critical to that, I also think, is the importance of having friends who are close to you in economic level - financially and values-wise.
    This is an aspect close to me, having seen my father and mother in-law retire to a posh Florida condo on a golf course, replete with couples so very much more well-off than they actually were. And seeing/hearing the envy in my mother-in-law's life take over during that time. No surprise, they too-quickly ran down their funds and had to relocate to our area in a much more financially reasonable retirement community (with our $ help). And resented it hugely, as they felt they "deserved" better. So sad when reasonable pragmatism gets lost in such an important process.

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    1. You are so correct, Steve. Because peer pressure is a powerful force, living in the midst of excess will eventually have its way. Your parents experienced that first hand.

      As a general comment, and not really singling our your parents, the pervasive feeling in our society that we "deserve" this or that is one of the root causes of so many of our ills.

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  11. This is a terrific post, Bob, and of course, 'retro' is going to be unique to each individual according to their means. In our case, traveling from place to place in our trailer, and staying in RV parks, saves us about $60 a night on lodging, plus the cost of eating out on a regular basis.

    We enjoy going to Las Vegas once a year to see a couple of splashy shows back to back, but we're then content to rely on Goldstar.com to pick up show tickets at deep discount the remainder of the year. The same with dining out - we enjoy one or two no-holds barred nights out a year, then rely on Groupon offers, or Happy Hour specials the remainder of the year.

    Biking and hiking remain some of our most pleasurable activities, both free once you've obtained the necessary equipment.

    The irony is we could spend more than we do based on our portfolio, but why would we when life is already so rich and full? As the article so aptly points out, more money does not necessarily equate to more happiness.

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    1. Even in retirement, spending below your means is important. Life has too many twist and turns to play things so close to the edge that you can't quickly adjust to a major shock.

      Your approach is much like ours...a few biggies each year, but then the happy hour-discount-coupon route keeps us happy and solvent.

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  12. Well, I do have to confess that Grand Cayman is on my short travel list-even willing to climb on a plane to get there and snorkel! Other than that, I agree that working with, and being comfortable with what you have is important.Im more than happy to take train and road trips, just as I am to enjoy the peace of my own patio.

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    1. Betty and I honeymooned on Grand Cayman oh so many years ago. Back then, the 7 mile beach was pretty empty. Now it is lined with resorts, but the beach and water are still spectacular. If you ever go, be sure to have Turtle soup and steak. They are farm grown so no fear of eating an endangered species!

      Maybe I should write a post on "patio peace." There are few things better than a sunny afternoon with a good book and a cup of coffee on the back patio.

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  13. Well Bob you have made me think. I'm 61 and if I sold my house for market value and added my other retirement savings I could walk away with about $1.4 million. BUT, so far I have felt this wasn't enough. Based on what we WANT to do, and we are NOT into possessions (I drive a 10 year old Acura for example), we still don't think we have enough. If I go to 66, I'll have $2 M and think that MAYBE I can do it.

    Then again, maybe I should just re-read your post.

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    1. I retired 12 years ago with less than the magic $1 million (not counting house equity). I know I will inherit enough to carry us to the end of our life and have some left over for our kids. But, it has taken simplifying and downsizing to leave me feeling things will be fine.

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  14. Bob, I enjoyed your article very much. The one thing that I have discovered is that the older I get, the less "stuff" I need. My daughter is 24 and has lived with us most of her life, well she is getting married in 3 mos. and my wife and I can't wait until we finally have the house to ourselves! We love her very much, but being able to go through the house and "declutter" will take a huge weight off my shoulders. One step closer to selling this big house and downsizing, I guess.

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    1. One of our daughters has been living with us for the past two years and is planning on moving out in September. When we downsized we bought a house great for two people, but not so great for three. Like you, we will get back a home that isn't stuffed to the gills.

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  15. This is so reassuring to read Bob. You are 12 years ahead of me and your information just set my mind at ease. Whenever I check my calculations, it seems right but great to have the voice of experience to reinforce that.

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    1. I drove myself crazy with calculations for the first few years. I finally accepted things would be OK, or I would figure out a workaround.

      Thanks, Kelly.

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  16. This is so perfect. How many times have we both said, " [live] under one simple rule: instead of worrying about how much money you need, base your lifestyle on what you have." As always you say it better than anyone.

    Barbara

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