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Can't Live If Livin' Is Without You

You Can’t Always Get What You Want

Some Boomers imagine working forever, but life surprises them with early retirement

We’ve all heard about Ed McMahon’s woes by now. I’ve tried every which way to understand what went wrong with his thinking, but it’s hard.

I get that he’s generous and gave away tons of his money to others in need. I know he has previous wives to support and a current one whose clothing design business he invested in heavily before it went belly up. And word was he might lose his McMahonsion to foreclosure, since he owed nearly $700,000 in back payments.

What I don’t get is how an 85-year-old man can say his financial woes are due to the fact that he broke his neck and couldn’t work in recent months. Tell me the truth: do you honestly see yourself working for a living in your mid-eighties? I’m not saying it’s a bad idea—-heck, it might be a great idea, if you’re doing something you love.

But how on earth could you count on being physically and mentally capable of working at that advanced an age? Wouldn’t you want to, say, have a paid-off house by then, just in case?

U.S. News & World Report, in an article aptly titled “Getting Ready for a Surprise Retirement,” says:

The vast majority of baby boomers want or plan to work in some capacity as long as they can. Eighty-four percent of people between the ages of 51 and 70 expect to work after they formally retire, and nearly two thirds say they can’t see themselves ever retiring completely, according to a survey by management consulting firm McKinsey Global Institute. The McKinsey analysis also indicated that 60 percent of boomers will need to work in order to maintain something like their current lifestyle.

But what if the world doesn’t turn out to be perfect? What if something happens that makes it so you can’t continue to work?

An Urban Institute analysis offers a sobering look at what can go awry with your retirement plans. It looked at people who were 51 to 61 years old in 1992. A decade later, over three quarters of them had lost their jobs, become widowed or divorced, developed new health problems, or were confronted with frail parents or in-laws. Any of those circumstances can take a bite out of retirement plans, if not force workers to scrap them altogether. A third of the participants had a health condition that limited their work, and 19 percent went through a layoff or business closing, the study found. And laid-off employees who managed to get a new job were less likely to get health insurance and earned about 25 percent less per hour, says Richard Johnson, a coauthor of the study.

Look, I love the stories of the geezers who walk to work every morning, put in twelve hours six days per week because they want to, and then die happily during a coffee break. It makes me happy to think of people well past the age we’ve come to think of as “retirement age,” still useful and fulfilled, doing exactly what they love and what they planned to do.

I’m just sayin’, you might wanna have Plan B in place.

And if you’re positive you’ll be working until you’re 85, I’ve got a McMahonsion to sell you.


Posted by Katy on 06/17/08
in LifestylePersonal FinanceRetirement

Cause I’m Leavin’ On A Jet Plane

Boomers need to lose some of the baggage, travel light, and enjoy the trip.

Last summer, my husband Doug and I made our third trip to Europe. And from a strict luggage point-of-view, it was by far the best.

Granted, the whole venture was planned on the spur of the moment. We hadn’t thought we’d be able to get to Switzerland for our youngest son’s college graduation, both because of the expense and because our daughter was getting married a mere week after we’d return.

But at the last minute, we knew we had to go—-and by “had to” I mean really, really wanted to. It was to be a six-day trip, and let me tell you that is not enough time to meet yourself coming and going. Jet lag is not my friend. Jet lag actually reduces me to a weeping puddle of pathos, from which it typically takes at least three days to recover.

So we made one great decision. We decided if I was going to bawl for three days, we sure weren’t going to make the situation any worse by hauling around too much luggage. We decided to take one carry-on wheeled bag, plug a smaller tote bag. For two of us. Period.

It was fantastic. Now I think maybe on the other trips, I might have actually been crying from a displaced shoulder or something. Do you realize how few clothes you need on a trip, if you’re willing to wash out some items in a sink if necessary?

John Flinn, who writes a column called The Competent Traveler for The San Francisco Chronicle, offers advice on hand-washing that a child could follow:

I’m surprised at the number of experienced travelers who don’t know about this trick to cut drying time in half: Lay out a dry towel on the floor, place your clothes on it and roll it up lengthwise. Take off your shoes and shuffle back and forth a few times on the roll to squeeze the moisture from your clothes. Give it a quarter turn and repeat. Let it sit for a few minutes and repeat once more. When you unroll your clothes, they’ll feel almost ready to wear.

Doesn’t that sound like some serious vacation fun? From now on, no matter how long of a journey we plan, we are not checking luggage. We’ve got no one to impress except each other, and that’s already been taken care of.

Posted by Katy on 06/10/08
in LifestyleDreamsTravel

As Usual, It’s All About Balance

What about semi-retirement, with deferred gratification not quite so deferred?

Financial columnist Humberto Cruz has long been a model for me of deferred gratification. I remember reading his stories twenty years ago, about how he and his wife gave up something in the here-and-now in order to have something in the seemingly far-off future.

But eventually, the future arrives. Even for Humberto Cruz, who must sooner or later face the fact that he’s done an outstanding job with his money. And that—-even though he’s still working—-it might not hurt to spend some of it now rather than wait until he’s too old to enjoy it.

Without enough money saved, you may have no choice but to postpone retirement. But that doesn’t mean postponing gratification, at least not all of it.

Cruz recently had a conversation with Christine Fahlund, a senior financial planner with T. Rowe Price in Baltimore. They discussed how many aging Boomers are being dealt the hard news that, because of the economy, they might not be able to retire as soon as they planned. And how the news affects them. Some, apparently, go into denial and retire anyway, insufficient funds notwithstanding.

There’s an alternative way to approach this dilemma, says Cruz:

Say you had your heart set on retiring next year, but a review of your finances shows you will need to keep working a few more years to build up your savings. At the same time, and making sure you stay within your budget, you could start to indulge in some of the “wants” you were putting off until retirement.

In other words, according to Fahlund, maybe it’s time to lighten up a little.

“If that is a cruise, take it now,” Fahlund said. “If you wanted to build a better workshop in the basement, start investing in the equipment you want. Do not delay gratification. Focus more on the cruise and the workshop” rather than on having to keep working.

Whatever you do, Cruz and Fahlund agree, don’t retire before the time is right. For every six months to a year that you remain in the workplace, you have that much less time to provide for during your non-working years. And if you can begin to really enjoy some parts of life you’ve been postponing, it might just make going to work much more palatable.



Posted by Katy on 06/09/08
in LifestyleDreamsPersonal FinanceRetirementSavings

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Are You a Late Boomer?

If looming retirement is catching you off-guard between an aging parent and a revolving-door kid, you might be. If you've delayed travel only to discover they've changed the names of all the countries, you are. And if you're a member of the Baby Boomer Generation who's ready to give back but you've forgotten where you put it, stay tuned. From healthcare to personal finance, from career changes to volunteerism, it's time to boom where you are planted.