October 7, 2011

Blogging and Comments: I Am Very Lucky

The last few weeks have been an active time for comments left after some of my posts. Actually, the largest response was generated by some of the comments left on CNNMoney.com after my profile article. So, I guess that was lots of comments about lots of comments!

What I enjoy about this blog so much is the overall tone and quality of those who leave thoughts and reactions. Many blogs fight the problem of inappropriate, rude, or nasty remarks. Some bloggers spend a fair amount of time each day weeding out the hateful from the worthwhile. I don't have to do that, and for that I sincerely thank you. That is what this post is about: the power of your comments.

I could have picked any of dozens of comments as my focus. But, in the interest of keeping this to a readable length, I have selected two that do an excellent job of capturing the essence of a satisfying retirement.

This one, from a reader with the pen name, jazz angel, provides an excellent overview of a couple just beginning their journey to a satisfying retirement::

My husband and I both worked for decades as public school teachers. We lived within our means, in a comfortable but modest raised-ranch home that felt a little snug when we were raising our three kids, but it's quite roomy now, and it's paid for. We also managed to pay for all three children's undergraduate college education. We gave them each a car (used) upon graduation from college, and now they are each gainfully employed and we feel that it's our turn to enjoy what we've worked so hard to accomplish.

My husband retired two years ago, and I just retired this year. We both just turned 60. We do not have millions of dollars saved, but we've crunched the numbers and we have enough to live on. Our state teachers' retirement system, which we've paid into for many, many years, pays us each a modest pension, and allows us to have an affordable health care plan and dental insurance plan. We are lucky in that we are both in good health.

We are taking this first year to figure out how to balance family, friends, interests, and travel on a budget. We've put one together that allows us dinner out once in awhile, a couple of days away every few months, and paying for a family vacation rental property every summer in order to get all of our kids and grandkids together for a week.

One day a week, we provide childcare for our daughter's one-year-old son. This is a joy that we love to share together. Another one of our children has two boys, and a third baby is expected in November. We'll be able to help out by caring for the older boys while their mommy gets plenty of rest after the birth. I am also looking forward to spending more time with my mother, who at 86 is still active and enjoying life. I'll be able to go visit her much more frequently now that I'm retired.

I've continued to teach by doing some one-on-one tutoring of adults, and I love it. Plus, I now have more time to teach my Jazzercise classes. I've been an instructor since I was 53 years old, and I love the exhilaration of a workout. Memorizing routines exercises my brain as well.

My husband and I both enjoy golfing, theater, learning to cook different cuisines, and traveling (except for the hassles of flying), and we are planning our budget so that we can go someplace warm for a week or two each winter through a combination of renting and visiting friends.

I feel that we're off to a good start. Staying active in the winter will be our biggest challenge, because we live in a cold climate and we've never been into skiing. Maybe snowshoeing would be something we could try together.

Thank you, jazz angel. What a tremendous look at the life of two folks who have planned, sacrificed, provided for others, and are now reaping the rewards. I second her contention that they are off to a good start.

Another reader, Steve from Los Angeles, is also following a carefully thought out plan to get him where he wants to be:

I am living modestly yet comfortably. I have my own residence, which is a two-bedroom and two-bath condominium in a suburb of Los Angeles. Although I have a loan on my residence, I will have the loan paid off within the next 11 years and 10 months. (I am 14 months ahead of schedule with my loan payments.) In addition to making the regular monthly loan payments, monthly homeowners' association dues, and twice-a-year property tax payments, I also pay the insurance premiums on my condominium owner's insurance policy and earthquake insurance policy each year. I also am making additional principal-only payments on the loan.

I am in my latter 50's and currently living on a modest government pension (which I will get for the rest of my life) and on savings that my parents left for me after they passed away. Later on (between the ages of 65 and 70), I will be living on the distributions from two annuities with lifetime income riders and on Social Security. I also have a Roth IRA. Starting at age 65, I also will be covered by Medicare.

I started planning for retirement when I was in my 20's. I am set financially for the rest of my life. I have lived beneath my means for almost my entire adult life. I currently live within my means by doing the following: (1) I devote most of my financial resources toward housing expenses (including my loan). (2) I prepare almost all of my meals at home. (3) Even though I do have a paid-for automobile (which gets great gasoline mileage), I rarely drive my car. I drive no more than 1,000 miles per year. I usually walk, ride my bicycle, or use public transportation. Consequently, I keep my automobile maintenance, gasoline, and automobile insurance costs low. As I do a considerable amount of walking, I am in great physical shape. (4) I keep the utility costs (electricity and natural gas) for my home low. My homeowners' association pays for hot and cold water.

It is possible for people to have a comfortable retirement. However, people must be highly motivated to do so.

In addition to being full of helpful information, both comments are supportive and pleasant. They have been posted by the readers in an attempt to validate the idea that a satisfying retirement lifestyle is quite doable, even in the midst of a poor economy.

Please take two points away from this post: my readers are an incredible group of people, and you have the power to shape your life and your retirement.

If you are a visitor or occasional reader, please consider making this one of your regular stops. You can subscribe by e-mail or reader. Both are free and both choices insure you never miss all the great comments left by folks just like you! Look for the link about halfway down the right sidebar.

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  1. Bob - What a surprise to see my comment included in your post of the day! I am glad to have found your blog, and I've recommended it to several friends.

    Last week there was a special series about retirement on NPR. Perhaps you listened to it. If not, you could listen to it on the NPR website here: http://www.npr.org/series/140809067/retirement-in-america-the-not-so-golden-years.

    I'd be interested to hear your reaction to the series. The title alone is rather grim: "Life In Retirement: The Not-So-Golden Years."

  2. I certainly don't want to be the first one of your readers to post a negative comment, but both of these readers have one BIG thing in common.

    They get a pension for the rest of their lives.

    There is no worry for them about their 401k hemorrhaging money constantly. My husband once had a pension. His company did away with it. My company also had a pension. They did away with it as well. For many of us, this is the horrifying reality. We have been handed a line of BS as far as putting money into 401k's. Every time I look at mine it is down, $10,000 or more. It is frightening.

    So yes, while these people have scrimped and saved, the pensions and health benefits that go with their retirement is why they have no worries.

    For the rest of us, who have also scrimped and saved, it is not so simple.

    Sorry, I don't mean to be negative but this jumped out at me.

  3. Jazz Angel,

    I am on vacation on Maui but will make a note to listen to the show when I return. Thanks so much for the information. Yes, the content of most retirement stories leans toward the negative. Obviously, things are very tough for a lot of people. But, to constantly tell us how bad off we are doesn't do anything constructive. Tell us how to do the best we can with what we have.

  4. Roberta,

    Rest easy, you are not being negative. Presenting all sides of an issue without rancor and name-calling is exactly why I wrote this post. The number of times I have had to delete a totally out-of-bounds comment can be counted on one hand with a few fingers missing.

    One note: both folks quoted in the post have "modest pensions." Obviously, that is better than none, but it doesn't sound like they are living with money to spare. Of course, it is possible that their pensions will be cut or eliminated in the future, too. They must live with the uncertainty of changes completely out of their control...much like your situation.

    All that being said, the collapse of your retirement plan (along with millions of others) is producing anger, fear, and resentment. I think that is much of what is causing the growing "Occupy Wall Street" movement that has started to spread to other cities. Where it goes we won't know for awhile. But, I for one am glad to see people breaking out of their apathy and making their voices heard.

    Roberta, you are a valued reader and regular commenter. I appreciate you taking the time to point out the other side of the issue. That makes you a positive, not a negative!

  5. Sorry, Bob but I have to agree with Roberta. People with government jobs, state jobs etc. with pensions should not be included in any successful retirement stories. Our government is broke and soon will be targeting these retirees and the odds are very, very good their pensions will either be eliminated or reduced. Especially their health care, most particular dental care (which may be deemed a luxury).

    I had the exact same retirement style such as jazz angel, all done privately, of course and I am sorry to say, my retirement only lasted 10 years before I HAD to go back to work. Not a nice scenario as one gets older. I've always lived below my means but lately that is no longer a recipe for success. I too bought snowshoes for hubby and myself for our winter months. Trust me, it didn't work out. Winters are cold. We need to get our of here between 1 to 2 months. Thankfully, my sister has a condo in Florida and she is gracious (yet, charges me) for my time there.

    Did you get any successful retirement stories from private individuals? I'd like to know how they are making out?

    Many local municipalities, such as Central Falls, RI just declare bankruptcy and now, no longer have to pay any retirement benefits. It's all just a matter of time. Best to prepare now whilst you are still young (60). Make sure you have a Plan B, C and even a D.

  6. I do agree with Roberta-one of the main reasons my retirement is so pleasant is that I have a pension-it's not big but it does cover my basic expenses. Although I always lived below my income and have investments, deferred compensation and IRA what makes my retirement secure is the pension and health insurance. I think there are a lot of people who don't make enough money to be able to save for retirement. People who have the money but don't save for retirement will never retire.

  7. Thank you Bob! I try not to worry by burying my head in the sand most of the time but every so often I pull my head out. Needless to say, it goes right back in the sand :)

  8. Morrison,

    Does my story count? I have never had a pension, employer-provided health care, paid vacations, or any of the normal benefits of working for someone else. Except for 5 years early in my career, I was self-employed, and self-insured, with a self-directed and funded IRA.

    I disagree that someone with a pension doesn't "qualify" as an example of a successful retirement. No matter what "benefits" one has received from an employer, there are many things that individual must do to on his or her own to make a go of it. Disqualifying those folks would be like saying anyone who did save enough for retirement and hasn't lost it shouldn't count.

    I certainly agree that those with a pension and employer-provided benefits are still at risk. As you noted, businesses and governmental agencies have this annoying habit of changing the rules after you have played the game.

  9. Donna,

    Having a pension and benefits is one of the lynchpins of what used to be considered an employer's responsibility to someone who worked for him. That is no longer the case, and as Morrison mentions, the rules can be changed.

    I have never had employer-provided health insurance and have spent a fortune buying it for me and my family on the individual market. There are times when I wonder how things would be been different if i had picked a career that afforded me the usual compliment of benefits.

  10. Steve in Los AngelesFri Oct 07, 06:57:00 PM MST

    I have some comments about what Roberta and Morrison stated about pensions. First, when I reach age 70, my government pension will make up about 20 percent of my total income. The rest of my income will come from my two annuities, Roth IRA, and Social Security. Second, about 70 percent of my pension payment comes from my own contributions and the earnings on those contributions. Third, I was required to participate in my former employer's pension plan. In other words, participation in the pension plan was mandatory just as my participation in Social Security and Medicare is required by law. By the way, Social Security and Medicare are not entitlement programs. They are insurance programs in which the overwhelming majority of people with earned income must, by federal law, participate.

    Every person has a choice as to where to work. They also have a choice as to whether they live beneath their means or beyond their means.

  11. Steve,

    I was hoping you'd stop by and maybe add a thought or two. Thanks for clarifying the reality of your pension situation. The misconception is probably that you are set for life with a government pension. The reality is as you noted.

    Your points are excellent ones and important to spell out. None of us gets a free ride regardless of how we fund our retirement. Unless a parent leaves you a million or two, personal responsibility and effective management of the opportunities presented to you still make the difference.

    Mahalo (thank you) and Aloha from Maui.

  12. When speaking to my family I often quote the turtle and the hare. My husband and I are turtles. Our jobs paid much less, but offer pensions. He stayed long enough for one, I did not. Still, we always lived below our means and have a good savings.
    My siblings and parents are small business owners. Two continue to be extremely successful and two are broke. They took the opportunity to be a hare and chanced speeding ahead. Sometimes it pans out.
    Don't blame the turtles for good or bad fortune. They take the slow slog and lose the chance of being bagillionaires:)
    I wish I were in Hawaii.Instead I am in a hotel in Tucumcari headed home. I cannot wait until March

  13. Janette,

    New Mexico and Hawaii are quite different! I'm sure you are looking forward to your break in March.

    My wife and I have always been turtles, too. For us it has worked, but it is no promise of success. I think that is how you complete the course, regardless of speed.

  14. I hope that Bob's posting of my story hasn't begun a polarization of the pensioneers vs. the non-pensioneers. We're all in this together, folks. My pension could go away, everyone's Social Security could be cut or disappear altogether, and any one of us could have a catastrophic illness befall us that would wipe out all of our savings.

    It's enough to make us curl up in a ball and weep.

    How we deal with the vicissitudes of life is our own choice. All we can do is hope for the best, plan for the worst, and enjoy each day as best as we are able. I could be really envious of people richer (financially) than I, but that would not bring me joy or well-being.

    Carpe deum and may your glass always be half-full.

  15. Jazz Angel,

    This post on the good manners and intelligence of commenters has proven to be true. There has been a disagreement of sorts over what qualifies as money for a satisfying retirement.

    But, it has been polite, and instructive. It has helped expose some issues that may not have been thought of before but done in a way that isn't disrespectful.

    AS you note, it comes down to choices...some we make and some our out of our control. So, it is what we do with the mix of those two that helps us build a lifestyle. It may not be the one we envisioned, but as the old song says, "I didn't promise you a rose garden."

  16. I identify with the turtle and the hare. I am a turtle -- but not on purpose. I remember getting a job at age 28 with a company that bragged about its good benefits. I was put into a retirement plan that seemed irrelevant to me at the time. But lo and behold, the years went by, and by the time I was tossed out at age 53 I had a decent amount of money in my plan. By the time the company went bankrupt a few years later, I had taken out my retirement funds and transferred them to my own IRA.

    So I've managed to hang onto my middle class lifestyle by building up a pension (which, I admit, I was lucky to fall into); then taking control of the pension and doing some homework to invest those funds. And working part time in retirement to pay for medical ins. and a few other necessities.

    But I also agree that we're all in this together. We all rely -- some more, some less -- on Social Security and Medicare; and we also rely on the American economy and the financial markets to keep funding our IRAs and 401Ks, etc. Hopefully, the economy will right itself, and SS will be secured for years to come. Not sure HOW that's gonna happen, but I hope it does or we're all in trouble.

  17. Steve in Los AngelesSat Oct 08, 11:57:00 PM MST

    Hi Bob,

    There are additional items I want to add with regard to the assets I accumulated for retirement.

    The overwhelming majority of my savings and investments came from old-fashioned saving and investing and in building equity in my previous residence. With one of my annuities, the money that funded that annuity came from saving and investing over sixteen years. For the money in the other annuity, that money came from building up equity in a fairly expense residence that I owned for over five years. I sold that residence in July 2004, rented an apartment from July 2004 to October 2008, and purchased my current residence (a condominium, which is smaller and much less expensive than the residence I previously owned) in October 2008. In other words, I significantly downsized from the residence that I sold in 2004 to my current residence. The money in the Roth IRA came from saving and investing over many years.

    In summary, the overwhelming majority of my retirement income comes from assets that I myself built up by living beneath my means, saving, investing, and making intelligent investment and financial decisions.

  18. Steve,

    Thanks for the added details. I continue to be impressed with the steps you have taken to accomplish your goals.

    As the various comments on this post have shown we all have different routes we follow. Sometimes we get to choose that route, and sometimes we don't. It is what we do with what we have available that determines how satisfying retirement will be.

  19. Sightings,

    This is a good example of taking something provided to you and taking personal responsibility for its care. Never having a pension I wasn't aware of that option.

  20. Well I don't have a pension, and I retired decades before I will ever qualify for Social Security. While I've only been retired for 4 years, I'm still right on track. Sure, I've had to make adjustments to my plans, given the state of the stock market, interest rates, and the economy in general, but that hasn't stopped me from totally enjoying my retired life. My lifestyle is significantly less luxurious than it was when I was still working, but I understood that was going to be the case when I made the decision to retire early. I would rather enjoy the time now than work for 2 more decades and enjoy a more cushy retirement with the time I have left at that point.

    And falling into a little part-time gig (part-time work being a new trend for many retirees these days) has temporarily brought back a few luxuries (in travel accommodations this year) that I'll be fine with giving up when I give that gig up.

    For those that think my retirement history is too short to "count," I look to the example of my dad who has been retired for nearly 2 decades. He has no pension, just saved while he was working, paid off his mortgage, and now lives a very satisfying retirement filled with (mostly) good health, good friends, a loving family, and a full travel schedule.

  21. Syd,

    It is all about adjustments, isn't it. Whether you are working, retired, or retired & working we all must adjust constantly. The first thing a financial adviser will tell you is to constantly monitor your investments and be sure they are doing what you want. Rebalancing is a necessity.

    I can fully understand the anger and frustration of those who were promised a certain benefit and found it has been altered or eliminated. Unfortunately, the anger will not move you forward. The reality is take what you have and make it work for you. It may not be what you dreamed it would be, but then life rarely is.

    After all, retirement is a full-time job, right?

  22. Retirement planning only happens when people spend time transitioning into retirement and this should start from the time people get their first job. Proper planning as shown above is absolutely marvelous and these folks are to be highly commended for their forethought and planning.

    However, this type of planning only really works when in a stable job. Today, there are far too many people who have been involuntarily retired and now face a very bleak future...even if some of them have had some planning in place for retirement.

    1. Your second point, Jan, it so telling. All the planning the world won't help if someone loses a job prematurely or had a series of jobs that never provided decent benefits or income to allow for retirement planning. Then, of course there are the people who did everything correctly, and got caught up the economic mess of the last few years. Through no fault of their own housing prices plummeted and investments tanked. They were left with no ability to repair the "damage" to their plans.