November 5, 2016

If Only I Knew This When I Retired


I  have been retired for 15 years. When I stopped working the world was a different place than it is today. 9/11 was still 3 months in the future. That event would shake up just about everything, including retirement. Financial planning and a certain predictability of how things worked would change almost overnight. Well laid plans would be shaken to the core.  

While still adjusting to a new world, our system suffered yet another huge shock just seven years later, with a recession that came close to an economic meltdown. It's ripples are still being felt today. I could argue that the contentious election cycle we are enduring is part of that ripple. 

Just because I had retired didn't mean I was isolated from the twin shocks of the terrorist attacks and the financial mess we found ourselves. In fact, in looking back I think those events may have had a greater effect on me mentally than if I were still getting a paycheck. I felt I had little control over my investments or economic well being. I didn't have an obvious path back to generating more income. 

If the stock market or banking institutions started to fail I was dependent on the government to make me (partially) whole at some undefined time in the future. My house seemingly lost value with every passing week. I could see years of planning start to slip away. 

Luckily for me, that didn't happen. I lost a bunch, on paper, and then rebounded within 4 years. The stress, worry, and time lost wondering what would happen was very real, but not permanent. I know I was lucky. I learned a very valuable lesson that continues to pay dividends today: There is always a path forward. Even when events conspire against us, there is positive movement possible. The surroundings, the trappings of one's life, the place and type of life one lives may all change, and not necessarily for the better. 

But, the freedom that comes with retirement, the ability to shape a life that is satisfying, regardless of the external circumstances, is a never-ending gift. The ability to not only survive, but thrive on a different path than the one planned for, is something I wish I knew when I first retired. 

My life in 2016 is not the one I envisioned in June of 2001. In fact, what turns me on today and keeps me motivated wasn't even on my radar back then. I could not have predicted how things are evolving. Now I understand what truly is important and makes me happy. If I had only known!


I must add that millions of my fellow retirees weren't as fortunate. Their future was forever altered by the events of the last 16 years. Retirement became a dream for many that was delayed, or unattainable. For them, much of what I write about a satisfying retirement probably rings hollow. And, for that I am truly sorry. The best I  can do is offer encouragement, maybe help you find a different path forward with what I write here, and be a sounding board for your frustration.


15 comments:

  1. We may just be in for another "correction" if the wrong person ends up on top three days from now. When the 9/11 meltdown happened the Dow was at 11,000, when Mr. Bush left office it seven years later was at 8,000 so overall there was not much recovering done. But yes it has more than doubled during the Obama term so some money was made.

    I know I am going against what the planners say but I don't put anything in the stock market that I can't afford to lose. Given the dismal return on safer investments mean that I am preserving my wealth but not increasing it by this practice.

    I will also echo what you said at the end. It is a fact that a big chunk of those retired depend almost totally on Social Security and that doesn't much satisfaction for them. But you have to play the cards you are dealt and even those folks can and do find joy in their lives with limited income. There is no taking frequent vacations or buying things beyond basic needs but that doesn't preclude joy...

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    1. My broker tells me to prepare for volatile reaction from the stock market on Wednesday, regardless of the income. There is a lot of pent up fear and uncertainty - two things investors hate.

      You are absolutely right that joy and satisfaction doesn't have to depend on income. But, at some point deciding between food and medicine, or transportation and paying rent, the joy pretty much goes into hiding.

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  2. Nice reflective post Bob and good point about remembering those not able to enjoy a comfortable secure retirement. Plenty to think about.

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    1. Thanks, John. It is too easy to forget that our circumstances are not shared by everyone.

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  3. Any correction that occurs in the markets next Wed will be very short-lived; in fact, that uncertainty was being baked in over the last nine days of market declines as Mr Trump's chances get brighter, and Wall Street's preferred candidate slips. Anyone who makes long-term investing decisions based upon such short-term events is asking for heartache.

    I too have noticed more and more retirees and near retirees who appear to be struggling. But I try to reserve my sympathy for those who are in such circumstances largely due to exterior events oftentimes out of their control. Those who had the wherewithal to save for the future but chose to live for the moment - eh, not so much. Might sound harsh to some readers but we have many voicing "woe is me" when it is often due to their own unwise decisions.

    That being said, I very much wish for the best for all fellow retirees or near retirees. With limited resources to help those older, usually due to poor decision-making by our so-called leaders, we need to keep as many of us afloat with our own resources in the interest of self-preservation!

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    1. It is a delicate balancing act for those of us fortunate to be in good shape. How to help those who are struggling? Empathy, donations of cash, material goods and time, and a willingness to assume the best of those find themselves slipping behind.

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  4. 9/11 resulted in a forced retirement for me. But I'm not complaining, I could have been in one of those towers. You remind us that the democratic capitalism that brings us both freedom and prosperity is a delicate thing, one we must support and serve by voting, volunteering ... and valuing our liberties and our responsibilities.

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    1. Exactly, Tom. Just a few days from today will be when we get to exercise that right.

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  5. Good thoughts, Bob. Although we should be concerned about the future of many fellow retirees, we also should recognize the progress made taking care of elders in the U.S. Less than a century ago, very large numbers of elders lived in poverty following their working years. Today, I believe the rate has declined to less than 10 percent. The poverty rate is much higher for children and young adults. So, we have a lot of fellow Americans to worry about in the future. A vote Tuesday to turn back the clock on social progress is not a good idea.

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  6. I read this morning a post by a full time RVer that talked about spending the savings or income we have in retirement. She said she bases her spending on what will bring her the most happiness, the most valuable experiences and not things.

    For my entire adult life, I embraced Joe Dominguez' criteria from his book "Your Money or Your Life". I measured the value of work based on the total hours I spent at it. If I made less money per hour than I felt my time was worth, it wasn't worth working and I made changes to move closer to work, work from home, save more and spend less so I could retire early, which I did last year.

    The RV'er's comment today made me think I need a similar philosophy for spending my money and time in retirement. Am I getting happiness in retirement from what I am spending my money and time on?

    Instead of *just not working*, this viewpoint raises the bar to evaluate the quality of my retirement.

    The jury is out.

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    1. The Dominquez/Robin book is the financial book cited most often by readers of this blog. Their message of determining whether the money you earn is equal to the time you spend is a powerful one. Almost 25 years after its publication it continues to be a strong seller.

      As you note, the concept is just as valid in retirement. Does the money we spend produce happiness or satisfaction. If not, is what we are spending worth the depletion of our capital?

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  7. An excellent and readable article again. My wife and I have been blessed far more than I ever thought possible. We live in a beautiful home in SC, close to our children and grandchildren, have more freedoms and gifts than could be imagined and our health seems to be holding.

    We have friends who did everything right who are not sharing our good fortune in life. I have to laugh because we are saving money in retirement. I thought we were supposed to be spending what we have saved.

    Your blog continues to be one of the most enjoyable and readable and one that I look forward to. Keep up the good thinking.

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    1. That juxtaposition between someone doing well in retirement and someone who followed the same "rules" but is struggling is one of the mysteries of life. It should give us pause to both be grateful for what we have and support/help the people who don't.

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  8. I was fortunate to be born with good genes and have been lucky in life. It is why I close most comments with "Good Luck". Others are not so blessed so I wish them better luck going forward.

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