For many of us, retirement follows a pattern that seems almost preordained. We have worked for several decades. We live a "normal" life, sometimes spending more than we should but being careful to set aside money for the future. We try to control our human urge for instant gratification and do our best to live within a budget. Eventually, we leave the world of work and begin to experience the freedoms of this new phase of our life.
Social Security starts. Medicare eases many of our worries about health expenses. We travel some, spend more time with family, satisfy our creative urges, volunteer in a way that gives back some of our blessings, and often see growth in our spiritual life. In short, our retirement is what we hoped for.Unfortunately, not everyone lives in this idealized picture. A post a while ago dealt with grandparents becoming parents. That topic generated some excellent comments. Another article about continuing to support adult children also hit a hot button for several. When does our financial commitment end, or is having a child a life-long support commitment? Most of us expect that the daily parenting part of our life is over as we approach retirement age. But, for too many, it is not. Dreams of a very different future are put on hold or ended.
What about having to retire due to an unexpected job loss, a Covid-induced issue, or any of the dozens of problems we all seem to be dealing with these days? How about folks that lived either paycheck to paycheck, just scraping by, or stitched together a series of part-time jobs, just trying to stay afloat until the economy and inflation tipped over their boat? The image of everyday retirement life isn't part of their reality.
I will readily admit that my retirement is progressing well. I am living pretty much the way I thought I would be at this stage of my life. A few early struggles over financial worries and time management are the worst I have experienced so far. Finding passions and things to occupy my mind and energies took a few years.
To offer advice to others in very different situations makes me somewhat uneasy. I have some thoughts based on what I have read, researched, and seen, but not based on personal experience. So, I hope I am not way off the mark. I can offer some thoughts and hope you will add your ideas and suggestions.
* Housing is likely to be a significant problem for someone with serious financial restraints. A typical home or condo is increasingly out of reach for new homeowners. If you sell your current home for more than you ever dreamed possible, the next one will be just as mind-boggling. In many parts of the country, affordable apartments are hard to find. Or the past few years, this problem has become a literal crisis. Evictions are on the rise after a pandemic moratorium.
* Housing is likely to be a significant problem for someone with serious financial restraints. A typical home or condo is increasingly out of reach for new homeowners. If you sell your current home for more than you ever dreamed possible, the next one will be just as mind-boggling. In many parts of the country, affordable apartments are hard to find. Or the past few years, this problem has become a literal crisis. Evictions are on the rise after a pandemic moratorium.
What are alternatives? Roommates and shared housing are options. The tiny house movement is a possibility. Park Models at RV parks offer security and comfort at reasonable prices. Certainly manufactured housing, either purchased or rented, can be an option. Staying with relatives may be the only option for now.
*Many skills and experiences lend themselves to participating in the barter and exchange economy. An estimated $14 billion in services are exchanged in the U.S. annually without cash. A family member of mine exchanges a 60-minute massage for hairstyling. Both ladies benefit, and no money changes hands. Maybe you have training as a nurse or adult daycare worker. Is it possible to exchange that experience for room and board?
Folks are making enough money to make life more pleasant by selling household items or collectibles on eBay. Buying things at a local flea market and then reselling them is common. Millions of us visit the website every day, all looking to buy or sell.
* The quickest way to make money is to spend less of what you have. I hope I am not minimizing the real problem some of our fellow retirees face. Choosing between food or prescriptions is not a theoretical choice for too many. Living through a hot summer without air conditioning can be life-threatening as we get older.
Even so, most of us can find something we can live without. What we consider a necessity may be a luxury when times are tight. After all, when we were growing up, there were three TV channels, no cell phones, and a meal out was a special treat. We didn't feel deprived.
* Retirement is not a forever state if you can't afford it to be. There is absolutely no shame in going back to full or part-time work. You will be thought of as a successful entrepreneur if you turn a hobby or skill into a business that generates any level of income. Don't get discouraged if some form of age discrimination makes things more difficult.
* It is hard to make sense of a situation where health care costs, particularly prescription medicines, are unaffordable to tens of millions of our citizens. . For the truly poor, Medicaid guaranteed treatment at the emergency room, and other government programs are available. They can be onerous and sap one's dignity, but they will keep someone alive. The lower and middle class gets shafted in this country, and I don't have an answer. If someone is forced into early retirement, employer-provided health care coverage is gone. Meals-on-Wheels may provide the only decent food someone receives all week, and services like that have suffered dramatically after Covid.
The pre-Obamacare model didn't work. The current state of health services is an improvement but continues to allow too many to fall through the cracks. Health care based on maximizing profits and minimizing contact with people who need a doctor is ridiculous.
Frankly, this is not a political issue. This is a moral and ethical embarrassment. Society has a responsibility to provide an essential service like health care to its citizens that can't afford decent care. New legislation that allows Medicare to negotiate drug prices appears likely and is a long overdue step, but that is not nearly enough.
A "normal" retirement shouldn't be our goal, regardless of financial or health status. I will tell anyone that retirement is a unique experience for each of us. At the same time, there are questions about how our less-fortunate citizens can deal with the problems that confront them.
I hope a few of the things noted above are helpful, but I am willing to bet you have some thoughts, ideas, and approaches I haven't touched on.
I hope a few of the things noted above are helpful, but I am willing to bet you have some thoughts, ideas, and approaches I haven't touched on.
It is very hard to see someone struggle in retirement d/t the choices made earlier. My 70yo friend retired early. Before this, she "let" husband #2 spend a great deal of her savings, they traveled abroad quite a bit, she sold her condo that was 75% paid for and then he found someone else. His home that she moved to had major issues and as I understand, they broke even so she really left with nothing but a meager IRA (about 1/3 what she needs to not have to worry month to month). At 62, she started SS and became nanny to her only granddaughter to save the kids $$ and they were agreeable to that. She gave up her home, her work, her further investment in retirement and lived with them. The GD is now 5 and she moved out. Buying a condo/home? Out of reach now. She just moved to a lower cost area and is renting a 1bed/1bath apt. She said if there is a spike of 15% in her rent, she can't do it. She took 1 huge spendy trip abroad this summer and said she can't do another.
ReplyDeleteWe all make choices we have to live with. I'm happy to have her visiting here (she just left after a 11d visit). I really struggle having empathy for the situation. I sure hope I don't hear the story repeatedly over the coming years. I can bite my tongue once but not for decades but I won't hold my breath. She still brings up something that happened after she moved out for college and she blames it on her parents. Sigh.....
I look forward to hearing from others.....I need to develop some empathy and I know it!
In situation like this we are torn between empathy and a feeling that "you made your own bed."
DeleteSometimes emotion leads us to make flawed decisions, as does misplaced trust. Maturity comes at different times in our lives, sometimes too late to save us from serious miscalculations.
The fact that you are aware of your empathy struggles is a positive sign. You will be there for your friend, even if only to listen and hug.
I know it can be hard. I find myself with my sister empathic, irritated and sometimes upset that she has all of her basic needs all paid for which Is irrational because what she gets is so basic. But she has no financial worries. She’ll make statements “I worked my whole life…..” (she hasn’t worked for at least 20 years, she’s 67 and was also able to be a SAH mom for about 8) which I was never able to do. But she’s had a hard life also. She ended up raising two granddaughters (thus not working, got grandparent stipend, subsidized housing, food stamps MA ……. (But I was a widow at 40 working continuously raising 4 kids.. yada…..) Now she finally is on her own, small HRA apartment, full disability (does have medical problems) ex railroad retirement small pension, food stamps, MA Medicare so I’m petty at times. I have more but worry more because as a widow it’s all on me so I worry. And I do get that this is not kind of me and irrational. I will say the first time I visited her at her apartment which is a basic nice/fine apartment (she’d been living with her daughter the previous 5 years and then qualified for senior living) I cried when walked into my house. So large, huge yard on a River. I’m not heartless ha!
DeleteWhile I appreciate Elle's frustration with her friend in this case, I am constantly amazing by the amount of "retirement lifestyle" judging that abounds in this area. You need to make above a semi poverty wage in order to save for retirement and there are millions of people in thus country who don't do that. And didn't do that. Through no fault of their own and they are mainly but not always single mothers, often educated single mothers. A teacher with three kids and no child support having to pay high medical costs and not getting benefits or many benefits at work (and not getting social security in many states) will not have the opportunity to save in the way that someone who works at the Federal government or IBM or its equivalent. Just as people who get gold health benefits railed against others having Obama care, this is a disconnect in terms of perception and reality. There is a huge lack of empathy from retiree haves for the have not, and blame is easy. Much of my outreach work is with seniors in poverty and even homeless seniors. They're mainly poor because they were lower middle class to poor before retirement their husband left and took all the goodies or similar circumstances. And the sharing economy will not make it better in the future. And I say that as the parent of two professional kids who do contract work with no guaranteed hours or benefits. Sometimes cutting out travel will help. You've actually just given me the idea for my second post in the blog now I'm back.
ReplyDeleteBarb, I'm glad this gave you a blog post idea, and I also thank you for your full-throated defense of those in our society left behind for any number of reasons. This is not an equal society by any measure. The idea that anyone can pull themselves up by their own bootstraps is a myth that perpetuates the problems..
DeleteAre there things an individual can do to improve their situation? Probably. But, to undue the damage of a bad marriage, a lack of education, or a health care system that does not provide even a basic level of care for all its citizens is often not possible..
This friend made more money than me her entire life and both of her ex-husbands made more than mine. Am I judging? I don't think so. She made her choices and now complains and is worried. If she weren't complaining and worried, there would be no comment here about her situation.
DeleteElle, in my view your original comment was a valid expression of frustration over a situation that could have had a different outcome.
DeleteBarb does make an important clarification about retirement judgement, but I don't see it as a reference to your situation. No one from outside your circle knows enough about the specifics of this case to come to a conclusion.
This exchange highlights the complexity of managing life's choices.
Agreed Bob. I know plenty of people who struggle. I also find they rarely complain about their choices and situations. Humans are interesting creatures.
DeleteI had a great career that came with a pension. With that and diligent saving over the years, we are doing pretty well in retirement. Pensions are almost non-existent these days unless you are employed by the local, state or federal government. I know there are a lot of people who struggle in retirement and with the rising cost of everything, I'm sure it's getting tougher by the day. I know several people who deal with the housing issue because the costs becomes too much as income decreases. I have a sister in law that is currently uninsured because of costs. I would imagine that the stress of these various issues makes it hard to totally enjoy the "normal retirement".
ReplyDeleteThis is a tough situation to write about because it is hard to not appear insensitive to things i personally have never experienced. My hope is there is a dialogue with the comments that allows each of us to sense the disparity present among us and both empathize and do whatever we can to help those for whom a retirement in any form is only a dream.
DeleteI agree with and echo many of the previous comments. We are seeing rents rise in my area at an astounding rate. There is real concern that, combined with current inflation pressure, some retirees and those reaching retirement will not be able to afford rent. There is a real possibility that some of these people will join the ranks of the homeless. Yes, some are in this circumstance because of poor planning or decisions, but many were born into poverty, or low income working class families who toiled lifelong in a day to day struggle to make ends meet. It is hard to think about retirement if you don't know if you can feed your kids next week. Get ready to see 80+ year old workers at Walmart and Burger King.
ReplyDeleteAs I have said before here, I am aware of how luck played a big part in the retirement life I enjoy today. I was born in the right place at the right time to the right set of loving, supportive parents. Those things alone put me ahead in life. I am also aware of the many who did not have that good fortune smile upon them and have been locked into a multigenerational struggle to survive economically. Death, divorce, abuse, lack of education often happen beyond the control of those who suffer. I also worry about young people, who seem to be "living in the moment" more so than did previous generations. Why financial and retirement planning are not (along with civics) mandatory high school subjects is a mystery to me. I agree with you, Bob, that group housing may be one of the solutions going forward. Maybe we could convert some of the old, abandoned shopping malls into "senior housing villages." It is time to get busy and creative.
Rick in Oregon
Besides agreeing with every point you make, i want to highlight the issue of financial literacy. Even for someone who struggles to make ends meet, understanding the very basics of how our financial system works (and doesn't work) is vital knowledge. Even if life circumstances may make it impossible to achieve what others do, knowing the ins and outs of credit cards, budgeting, making choices, and fighting against the pressure of instant gratification are critical to even holding your own.
DeletePeople make bad economic decisions every day of their life then are astonished when they do not have enough in savings. My wife and I deprived ourselves of many luxuries we saw others partaking in so we could have a comfortable retirement. Several years ago some young co-workers were making jokes because I was wearing $ 50 Rebooks and they had $800 Air Jordans. I told them I saved the other $ 750 as running shoes are running shoes. I know people who leased new cars or iPhones every year. While we made do with our paid for cars and phones. We have thought of renting out part of our house but do not like the idea of having strangers in our home. There is a company which you can rent rooms in your house for storage, which is something we are considering to do in the future. We have considered moving to Florida or the Carolinas but we both do not like the high humidity so we probably will stay in our current home and use Air bnb to stay at the beach for cooler months. I have heard cases where ordinary people became millionaires like the former Vermont Janitor who lived modestly and left $ 6 million to the local library and hospital. Most of my working life I would drink the company coffee and bring a bag lunch to save money. People never think of the opportunity cost of those $ 5 coffees or fast food lunches.
ReplyDeleteI will reiterate the comment about a lack of financial literacy in our culture. It is not taught at schools and parents who have struggles with bad decisions or unfavorable life conditions are in no position to help their offspring.
DeleteIt is up to those of us who understand the importance of delayed gratification, avoiding peer pressure to get the expensive sneakers, and making sacrifices now for a better tomorrow to help younger generations.
My experience in working with 5th graders through Junior Achievement taught me we can't start too early. Most of these 10 or 11 year old kids had little grasp of how our financial system operates, and that is scary.
Like Coffee Shop above I had a good career and while there was no pension I made a good enough wage to be able to max out my retirement savings limit for most of my working years. My retirement is all I imagined it would be and even though our overall income is lower I feel like we have more available to us now than when we were working (I find it frees up a lot of money when you are no longer saving for retirement). But as Barb points out many are not as lucky as we were through no fault of their own.
ReplyDeleteLooking at my two daughters I know one will be fine. She has a well paying public sector job with a fantastic pension and her husband works for the insurance division of a major bank with a similarly great pension. My other daughter I worry about. She has a 2 year college degree, works in childcare and loves the work, but in that line the wages are notoriously low and most places do not offer any benefits at all. At 36 she is a new single mom and loves her son to death but it isn't going to get any easier for her. I can see a very difficult time ahead when retirement age rolls around for her in 25 years or so.
I imagine most of those struggling financially in retirement now have similar back stories to my youngest daughter. Doing those important but poorly paid jobs the more fortunate among us rely on. Saving at all is near impossible and any sort of crisis like missing a week off of work or needing dental work can put you back financially for months and months. I guess this is where the "continuing to support adult children" comes in for me as typically I step in to get her back to zero but then that affects us too. Any money I send her way is coming straight from our retirement savings. We can afford it for now but is that something I should be doing? Such a tough call.
Your suggestions for those struggling in retirement seem reasonable enough though I have no idea how realistic they are. It's like when my wife took our youngest daughter shopping to show her how to bargain hunt. It ended up costing way more than my daughter could afford. Yes the on-sale family sized box was cheaper per serving than the single sized box but you have to able to afford the family sized box in the first place. As I said to my wife "We've had enough money for a long enough time that shopping with very little money is something we really don't know how to do anymore".
The subject of how much to help adult children has absolutely no simple answer and cannot be judged by someone not intimately involved. Our youngest daughter's income varies quite a bit from year to year, during the worst of Covid it disappered completely. We stepped in because we felt we had to, and would do so again if required.
DeleteI know Betty and I have been blessed in this lifetime. My deepest hope is to understand that, not judge others who weren't, and do what I can to ease the anguish of those less fortunate due to life cicumstances over which they had no control.
I have known folks with medical issues that have financially devastated them at a fairly early age, and also folks who had a marriage partner run off with the cash, business partner doing the same, job loss, etc. I have known some who have had multiple issues like medical, divorce because of the stress, and then job loss bc of the medical. I try not to judge. It can take years to recover. Some folks never do. Cindy in the South
ReplyDeleteThere are so many life circumstances that can seriously derail our plans or desires.
DeleteAs many have said, there is a vast difference in how people were able to prepare and save for retirement. Looking back, I am grateful that I had a few really lucky breaks that allowed me to avoid debt and save for retirement, and I've been lucky vis a vis my health. But I also know a woman who was diligent with hr finances and found out her husband (who quickly became her ex) was not paying their mortgage and had somehow pilfered her retirement account down to nothing before she discovered it. She was young enough to do some recovery, but it was devastating.
ReplyDeleteI can't imagine that level of betrayal of trust and being strong enough to at least partially recover.
ReplyDeleteOne thing regarding my retirement has been my husband's increasing health issues. I knew in the back of my mind as a nurse that this would a retirement possibility for us, I just didn't think it would happen this soon. His health issues mean that we stay closer to home for the most part.
ReplyDeleteI did not know it at the time when I hired on, but I was fortunate to have had a career with the federal government and my "part time" career with the Army Reserves both jobs with pensions, medical, and retirement savings options. I consider myself lucky that I was able to go back to school in my mid 20's and get a degree. I did not think much about retirement when I was younger!
One of the quirks of human nature is our ability to know something is coming, but not accept that reality until it is literally staring us in the face. To not think about retirement in your 20's means you were very normal.
DeleteI am sorry to learn of your husband's health issues. At the same time I am happy for both of you that you have the resources to weather the storm. The very best to you, Happy.
WHO SAID LIFE IS FAIR !!!!!!!!!!!. Just read through the above comments and we find lucky people, some born with a silver spoon, and some who struggle all their lives. I would categorize myself in the "lucky, hard working, financially savvy person" category. Me and my wife moved from India about 30 years ago, started from scratch, but worked hard and lived below our means all our lives, to accumulate a nice retirement nest. I retired this year and my wife is working only because of health care coverage. We have one daughter, who is a nurse, single and could very well live a decent comfortable life; however, she believes in instant gratification and living beyond her means, in addition, she has multiple health issues, which add to her expenses. It is a tough choice for us that even though we want to help her financially, (which we do), but she squanders her earnings on things, which we feel are extravagant. Her way of thinking is diagonally opposite to ours. We are all born different and we all think different and that's why we have so many varied opinions. Some learn from other people's mistakes and some don't even learn from their own mistakes. And like you said, life circumstances for each of us are different and we all react differently to carve out our path in life.
ReplyDeleteYou have summarized our dilemmas well: knowing what to do but too many of us falling prey to the siren call of instant gratification.
DeleteIt all comes down to personsal choices and responsibility. Thank you for your addition to this discussion.
I've just been watching my younger sister's financial security come unraveled due to a marital breakup. Just a few years from retirement age, she has been forced to sell the house she has lived in for decades and, because she's only getting half the proceeds of the sale, she can't afford to buy anything else. The rent for the only apartment she could find is more than the total of all my monthly expenses. Yikes!
ReplyDeleteThat's horrible. Would a virtual group hug from all readers make her feel a little bit better?
DeleteI’m so sorry for that!! You wonder does she have any recourse? Going after spousal support? Can’t imagine that! I do know what it’s like to see the financial disparity of being single versus a couple in retirement. I’ve been a widow since I was 40 but the financial difference has really just hit me in my 60’s and when SS and pension started. All my retired friends are a couple. Major costs are the same/similar especially utilities, property taxes … (we all own our homes) but I can’t imagine two SS and pensions coming in. I at least knew this coming of age. I can’t imagine your sister!
DeleteThis comment about single vs. married couple finances prompted me to look at some U.S. Census data. In 2020, married-couple households age 65+ had a median income of $72,800. (This means that half the married couple households in this age range had higher incomes than the median and half had lower incomes.) Men 65+ who were not living with a spouse but were living with other relatives (e.g., children or siblings) had median household incomes of $78,400. Men 65+ living alone had median incomes of $30,140. For women 65+, those not living with a spouse but living with other relatives had median household incomes of $52,000; those living alone had median incomes of $23,770. Because women, on average, earn less than men throughout their work lives and because their employment is more likely to be interrupted or constrained by caretaker responsibilities, women arrive at retirement with about 30% less in retirement savings than men have and they also get lower social security payments.
ReplyDeleteThe difference is not surpring but still shocking. Women continue to be undervalued in our society.
DeleteThe rational behind not paying Social Security for stay-at-home parents is shameful. What does it cost per month for daycare? That should be the minimum that SS is based on.
The comments here are certainly engaging. I can't help but find myself thinking about the macro-moral question, and that question is a difficult one to answer to be sure. Under FDR, we as a country decided we were wealthy enough to afford social security because we felt such a program reflected our values. I am grateful that such a statement of values was made. I have been to other countries and seen abject poverty. In some of those countries, the elderly suffer tremendously. I would not like the US to join those ranks. Perhaps we need to think about how to strengthen our social networks. The recent moves in medicare are, in my opinion, putting us on the right track. I hope we will continue down such a path, but I do have real concerns about the state of social security and what happens if we can't shore it up.
ReplyDeleteThe new legislation that seems about to be passed that will allow Medicare to negotiate some drug prices is a long overdue first step.
DeleteSocial Security needs to eliminate the cap on income levels that are taxed. At present they are artifically low.