Everyone in my husband's family knows that I am not a gambler. His family loves to sit around the table and play poker; it's a multi-generational thing and they have a great time. Most of the time I sit off in a corner, reading a good book. (Pop always wins the big money, anyway! Just ask him. He'll tell you!)
When finally pressed to play, I usually go in, play a few hands, take my winnings off the table as I go along -- to the sound of a lot of teasing -- and finish up by winning a big pot.
Then I stop playing and go back to reading.
In Las Vegas, which I don't much like, I will take a roll of nickels to the nickel slots, and I won't even spend all those nickels.
I don't like to lose money.
Back in 2005, when I started the retirement planning process, I started thinking about the stock market as a gamble rather than as an investment. That change in perspective probably came about the time I saw a 401(k) statement with a huge loss in a single quarter -- tech stocks, anyone? GAH!
That spring, when we regrouped and reassessed, the first thing we did was to think for the first time about all our retirement assets as a single entity. With that in mind, we took the largest 401(k) built up over 25 years' time, and put all current holding into 2 fixed accounts. That is, we took our investments and "winnings" off the table.
I don't recall exactly what they were, but I can tell you they were NOT stock accounts. That comprised the fixed portion of our portfolio in that largest account. Additional contributions to that account were not added to the fixed portion but instead built up some more carefully examined mutual funds.
In other accounts, spread far and wide until I got them under one investing umbrella (mostly) via rollovers, I worked in much the same way.
As we stand right now, we are at a15/85 mix, and that feels about right for us, with a careful mix of laddered CDs, a few bonds, some index funds, and a few other funds with somewhat higher expenses to accompany higher returns. We also have about 6 stocks, just because we still like to see how they are working. We don't have any TIPS yet, except for a small amount in a 403(b) account. I am still learning about those.
Along the way I've learned a lot, but I have more to learn. However, it's what engages me right now, and I have plenty of time!
Thursday, March 31, 2011
Wednesday, March 30, 2011
The Turning Point for Retirement Planning
As I wrote in an earlier post, I started taking this retirement planning business much more seriously somewhere in the spring of 2005, just before I turned 50.
What really started it was that I had recently had a change at work and realized, thanks to a pointed question from my niece, that I needed to make some changes in my life. I was telling her about my misery at work, and she asked me this: "Do you really see yourself doing this for another year?" I had to say No. I left my job soon after that, difficult as it was to do so.
With some free time on my hands that spring, I grabbed armloads of financial files for our 401(k)s, IRAs, etc., took them out to the patio table and sat in the sunshine, devoting myself to understanding more clearly what our financial situation was with respect to retirement funds. Although we had worked hard to accumulate that money, we didn't really have a good a sense of how to manage what we'd accumulated. I imagine we weren't too different from a lot of people in our situation.
It finally became clear to me, though, that being in our 50s, we may not have that much time to make up any losses we might sustain with a more aggressive or undirected investment style. I wanted to keep what we'd saved.
That realization in 2005 was the beginning of the fat green financial binder I started building and the shelf full of personal finance books that set me on the road to our real retirement planning.
From 2005 to 2008, little by little, I learned about asset allocation and diversification. I learned more about the proper mix of assets for our risk profile. I started some handwritten charts on lined tablets to sketch out the anticipated build-up of assets over time. I started planning in earnest. Thank goodness I did.
In mid-2008, my husband lost his job of 29+ years, and I lost my job with a bank 4 months later. Thanks to those sunny days on our patio, we were much more ready to weather these job losses and the later 2008 market losses.
Since 2008, I have of necessity shifted my retirement planning from the accumulation phase to thinking and learning about the withdrawal phase, even though we are only in our 50s. Despite what the media tells us about being unemployable at our age, we both still look for work, but we also realize that we may never work again.
Those early handwritten charts and notes on lined paper have evolved to Excel spreadsheets that I've developed to help us both see where we've been, where we plan to go, and whether we are in line with our plans. I keep the earlier handwritten notes, though, just to remind myself of where I got started planning -- and to remind me that it's never too early to start because you just never know when your career will come to an end, ready or not!
What really started it was that I had recently had a change at work and realized, thanks to a pointed question from my niece, that I needed to make some changes in my life. I was telling her about my misery at work, and she asked me this: "Do you really see yourself doing this for another year?" I had to say No. I left my job soon after that, difficult as it was to do so.
With some free time on my hands that spring, I grabbed armloads of financial files for our 401(k)s, IRAs, etc., took them out to the patio table and sat in the sunshine, devoting myself to understanding more clearly what our financial situation was with respect to retirement funds. Although we had worked hard to accumulate that money, we didn't really have a good a sense of how to manage what we'd accumulated. I imagine we weren't too different from a lot of people in our situation.
It finally became clear to me, though, that being in our 50s, we may not have that much time to make up any losses we might sustain with a more aggressive or undirected investment style. I wanted to keep what we'd saved.
That realization in 2005 was the beginning of the fat green financial binder I started building and the shelf full of personal finance books that set me on the road to our real retirement planning.
From 2005 to 2008, little by little, I learned about asset allocation and diversification. I learned more about the proper mix of assets for our risk profile. I started some handwritten charts on lined tablets to sketch out the anticipated build-up of assets over time. I started planning in earnest. Thank goodness I did.
In mid-2008, my husband lost his job of 29+ years, and I lost my job with a bank 4 months later. Thanks to those sunny days on our patio, we were much more ready to weather these job losses and the later 2008 market losses.
Since 2008, I have of necessity shifted my retirement planning from the accumulation phase to thinking and learning about the withdrawal phase, even though we are only in our 50s. Despite what the media tells us about being unemployable at our age, we both still look for work, but we also realize that we may never work again.
Those early handwritten charts and notes on lined paper have evolved to Excel spreadsheets that I've developed to help us both see where we've been, where we plan to go, and whether we are in line with our plans. I keep the earlier handwritten notes, though, just to remind myself of where I got started planning -- and to remind me that it's never too early to start because you just never know when your career will come to an end, ready or not!
Thursday, March 24, 2011
Having, and Being, a Retirement Planning Mentor
In an earlier post, I mentioned my husband's father as having taught the kids to buy stocks. He got his 4 children started out early in understanding about investing. I don't know what the other 3 kids did, but I know my husband and I picked up on those lessons and started investing as best we could early in our marriage.
Nearly 32 years after I married into that family, my father-in-law has been retired 22 years this week, and he and I have become an investment/financial chat group of two. When we visit, Pop and I sit with our morning coffee, watching the stock ticker run across the bottom of the TV screen, moaning or cheering as the ticker moves us.
When he visits us, we both do the Saturday morning "counting of the shekels," as I have come to call it, where we both log into our respective retirement accounts and see what's up -- or down, as the case may be. We discuss investing strategies and have a good ol' time. Well, at least I do!
Because we got started out sharing this information, in this way, it became natural for me, then, to ask Pop questions about Social Security, Medicare, and other investment issues in retirement. He has opened his annuity files, his trust files, and anything else that I have questions about, because he knows I am the Retirement-Planner-in-Chief for this branch of his family, and I can learn from him how best to manage funds leading up to and in retirement.
What I have learned from these interactions is this: Although I can read lots of articles, book, blogs, whatever -- there's a whole world of stuff out there to read -- for me there is nothing quite like the concrete fact of a financial statement in my hand, or a Social Security Direct Deposit pay stub in my hand to help me understand that No, Medicare is not free, and Yes, those premiums are deducted from Social Security.
That sharing makes me understand what difference the yearly raises -- or not -- can mean to a retiree. I learned about the higher Medicare premiums that came about as a result of Pop's having a higher income one year.
It takes a lot of trust for a person to open his financial life to the inquiries of someone else, and it means a lot to me that my father-in-law trusts me to that extent.
It also means a lot to me to have him as my Retirement Mentor, and I suppose that my reason for blogging here is not just to write about things of interest to me. More important, I would like to be able to reach others and teach others, even in a small way, about some of the questions and issues that will arise when they get closer to retirement -- whether they are quite ready or not!
There is so much to know, and I would love to be able to share knowledge in a way that will at least prompt people to start asking some of the questions they should be asking. The problem is, they don't even know what they don't know but need to know!
Nearly 32 years after I married into that family, my father-in-law has been retired 22 years this week, and he and I have become an investment/financial chat group of two. When we visit, Pop and I sit with our morning coffee, watching the stock ticker run across the bottom of the TV screen, moaning or cheering as the ticker moves us.
When he visits us, we both do the Saturday morning "counting of the shekels," as I have come to call it, where we both log into our respective retirement accounts and see what's up -- or down, as the case may be. We discuss investing strategies and have a good ol' time. Well, at least I do!
Because we got started out sharing this information, in this way, it became natural for me, then, to ask Pop questions about Social Security, Medicare, and other investment issues in retirement. He has opened his annuity files, his trust files, and anything else that I have questions about, because he knows I am the Retirement-Planner-in-Chief for this branch of his family, and I can learn from him how best to manage funds leading up to and in retirement.
What I have learned from these interactions is this: Although I can read lots of articles, book, blogs, whatever -- there's a whole world of stuff out there to read -- for me there is nothing quite like the concrete fact of a financial statement in my hand, or a Social Security Direct Deposit pay stub in my hand to help me understand that No, Medicare is not free, and Yes, those premiums are deducted from Social Security.
That sharing makes me understand what difference the yearly raises -- or not -- can mean to a retiree. I learned about the higher Medicare premiums that came about as a result of Pop's having a higher income one year.
It takes a lot of trust for a person to open his financial life to the inquiries of someone else, and it means a lot to me that my father-in-law trusts me to that extent.
It also means a lot to me to have him as my Retirement Mentor, and I suppose that my reason for blogging here is not just to write about things of interest to me. More important, I would like to be able to reach others and teach others, even in a small way, about some of the questions and issues that will arise when they get closer to retirement -- whether they are quite ready or not!
There is so much to know, and I would love to be able to share knowledge in a way that will at least prompt people to start asking some of the questions they should be asking. The problem is, they don't even know what they don't know but need to know!
Wednesday, March 23, 2011
Spring IS Here, Really it is!
Last Thursday we had a great day of sunshine, so my husband and I, accidental retirees both, got out into the front yard and did a lot of weeding, spading, and other prep work to boost our curb appeal here in our little neighborhood. Two neighbors noticed we were getting busy out there and wondered whether we were readying the front yard for "Safety Meetings" -- those informal get-togethers that started last summer when my husband and I sat out front with a glass of wine and waved to neighbors who eventually meandered over and joined us with wine, snacks, and great companionship and conversation!
Even our new next-door neighbor, here since October 2010, joined us for a pre-season Safety Meeting, in early February when we were having amazing weather here in the Bay Area. A twenty-something, he believes, I betcha, that he has moved to the right neighborhood.
Into every life a little rain must fall, I guess, and our Thursday of sunshine gave way to a wild, wet, and windy Friday, Saturday, and Sunday, yet thanks to all the prep work and pre-planting garden center runs we did, I was ready to keep weeding, pruning, and planting in the sunny spaces between the storm patches.
Yesterday was another sunny morning, at least, which meant another run to the garden center and a few more plants to fill in some empty spaces. When the rain started in the afternoon, I could look with satisfaction on what I had planted in the days earlier and feel some satisfaction that things are looking better.
It's not just the gardening, though, that tells me Spring is here, even if the calendar didn't already tell me so; it's the change in how I feel.
In one of my favorite novels, Enchanted April, ossified old Mrs. Fisher makes it to Italy with some young women, as her roommates, and she finds, as Italy seeps into her heart and her bones, that she feels she is starting to come out green all over, as if she were sending out little shoots. I know that feeling.
I mean, I started this blog, and I am already thinking about another one. I am starting an online class next week, and I have another class I am ready to sign up for. I am getting closer to my next volunteer gig training, and today I was asked to consider joining the Board of Directors of a local agency. I just may do that.
I have more energy, and I feel my brain going in about 20 different directions. I was wishing I had an iPad or a laptop or something so that I could blog while I was at the doctor's.
Yes, spring is definitely here. Welcome!
Even our new next-door neighbor, here since October 2010, joined us for a pre-season Safety Meeting, in early February when we were having amazing weather here in the Bay Area. A twenty-something, he believes, I betcha, that he has moved to the right neighborhood.
Into every life a little rain must fall, I guess, and our Thursday of sunshine gave way to a wild, wet, and windy Friday, Saturday, and Sunday, yet thanks to all the prep work and pre-planting garden center runs we did, I was ready to keep weeding, pruning, and planting in the sunny spaces between the storm patches.
Yesterday was another sunny morning, at least, which meant another run to the garden center and a few more plants to fill in some empty spaces. When the rain started in the afternoon, I could look with satisfaction on what I had planted in the days earlier and feel some satisfaction that things are looking better.
It's not just the gardening, though, that tells me Spring is here, even if the calendar didn't already tell me so; it's the change in how I feel.
In one of my favorite novels, Enchanted April, ossified old Mrs. Fisher makes it to Italy with some young women, as her roommates, and she finds, as Italy seeps into her heart and her bones, that she feels she is starting to come out green all over, as if she were sending out little shoots. I know that feeling.
I mean, I started this blog, and I am already thinking about another one. I am starting an online class next week, and I have another class I am ready to sign up for. I am getting closer to my next volunteer gig training, and today I was asked to consider joining the Board of Directors of a local agency. I just may do that.
I have more energy, and I feel my brain going in about 20 different directions. I was wishing I had an iPad or a laptop or something so that I could blog while I was at the doctor's.
Yes, spring is definitely here. Welcome!
Retirement Plan[t]s, Part II
Today as I was sitting waiting for my doctor's appointment, I was mulling over the stuff I'd written earlier today, the whole garden metaphor I was working on, and it struck me that I see even more connections between retirement and gardens than I had realized.
For example, I've read about retirement income being a "three-legged stool" consisting of Social Security, personal savings, and an employer's pension. I've also read in an interesting Prudential publication about the 4 pillars of retirement: http://www.prudential.com/media/managed/FourthPillarRetirementChoices5-10-07FINAL.pdf.
What works for me in these concepts of what supports our retirement income is that we need to have more than one source; both show that Social Security won't be enough, and that's something that a lot of people may not have yet figured out. Something I read recently, the source of which escapes me just now, shared a survey in which some high percentage of people headed for retirement thought they were going to get a pension -- but they didn't have any idea about the source of that pension! Clearly there needs to be more education along these lines.
What does not work for me in the stool legs and pillars concepts is that both indicate those legs or pillars are somehow equally weighted; that is, that a savings stool leg will be of the same diameter as our social security one, or that the pillar for our retirement time behaviors (such as part-time work or downsizing), will have the same diameter, hence the same importance or weight, as our employer pension.
I started thinking about the retirement income stream in another way: as a garden I plant and tend along my way. Each source of retirement income, not only the type but also the time at which we draw it, is a little bit like planting a garden.
Social security and an employer's pension (when we are fortunate enough to have and collect them) are the early-planted perennials of our garden. Maybe they are the evergreen shrubs that are low to the ground. Is it a juniper? The one that spreads is the inflation-indexed social security -- every so often, this one will get pruned back by Medicare premium deductions -- while the non-inflation-indexed pension that was frozen a while back is another kind of evergreen that stops growing at some point. Maybe it's an English boxwood, and it's somewhat more fragile and dependent on good growing conditions than the Social Security juniper.
Along the way, we add to those base plantings with 401(k) and IRA contributions. Depending on how we invest those funds, our crop will have some good years and some not-so-good years. Over time, though, maybe like the daffodils I plant, they will naturalize -- if I feed them, and if I can keep the snails and the neighborhood kids out of them. When there are plenty of flowers I can harvest more, but when I've been a little too lazy in the garden, my cuttings garden is more bare.
That cuttings analogy runs through the drawdown time of contributions, too, not just in the planting. If the solid background of evergreens (social security and a pension, say, or an annuity), are always in the background, supplemented by the retirement behaviors we choose (spending less, one way or another), then we can cut more from our cutting garden (IRAs and 401(k)s when we need to -- when we tend things correctly -- and leave that 'garden' to propagate (earn more interest, dividends, capital gains) in times when it needs to reseed and rejuvenate.
In a way, then, retirement saving and retirement planning both are more cyclical to me, a process in which some parts of the process get more emphasis or are weighted differently throughout our saving and drawdown cycle, a cycle in which we revisit what our garden needs in the way of seed and harvest all along the way.
For example, I've read about retirement income being a "three-legged stool" consisting of Social Security, personal savings, and an employer's pension. I've also read in an interesting Prudential publication about the 4 pillars of retirement: http://www.prudential.com/media/managed/FourthPillarRetirementChoices5-10-07FINAL.pdf.
What works for me in these concepts of what supports our retirement income is that we need to have more than one source; both show that Social Security won't be enough, and that's something that a lot of people may not have yet figured out. Something I read recently, the source of which escapes me just now, shared a survey in which some high percentage of people headed for retirement thought they were going to get a pension -- but they didn't have any idea about the source of that pension! Clearly there needs to be more education along these lines.
What does not work for me in the stool legs and pillars concepts is that both indicate those legs or pillars are somehow equally weighted; that is, that a savings stool leg will be of the same diameter as our social security one, or that the pillar for our retirement time behaviors (such as part-time work or downsizing), will have the same diameter, hence the same importance or weight, as our employer pension.
I started thinking about the retirement income stream in another way: as a garden I plant and tend along my way. Each source of retirement income, not only the type but also the time at which we draw it, is a little bit like planting a garden.
Social security and an employer's pension (when we are fortunate enough to have and collect them) are the early-planted perennials of our garden. Maybe they are the evergreen shrubs that are low to the ground. Is it a juniper? The one that spreads is the inflation-indexed social security -- every so often, this one will get pruned back by Medicare premium deductions -- while the non-inflation-indexed pension that was frozen a while back is another kind of evergreen that stops growing at some point. Maybe it's an English boxwood, and it's somewhat more fragile and dependent on good growing conditions than the Social Security juniper.
Along the way, we add to those base plantings with 401(k) and IRA contributions. Depending on how we invest those funds, our crop will have some good years and some not-so-good years. Over time, though, maybe like the daffodils I plant, they will naturalize -- if I feed them, and if I can keep the snails and the neighborhood kids out of them. When there are plenty of flowers I can harvest more, but when I've been a little too lazy in the garden, my cuttings garden is more bare.
That cuttings analogy runs through the drawdown time of contributions, too, not just in the planting. If the solid background of evergreens (social security and a pension, say, or an annuity), are always in the background, supplemented by the retirement behaviors we choose (spending less, one way or another), then we can cut more from our cutting garden (IRAs and 401(k)s when we need to -- when we tend things correctly -- and leave that 'garden' to propagate (earn more interest, dividends, capital gains) in times when it needs to reseed and rejuvenate.
In a way, then, retirement saving and retirement planning both are more cyclical to me, a process in which some parts of the process get more emphasis or are weighted differently throughout our saving and drawdown cycle, a cycle in which we revisit what our garden needs in the way of seed and harvest all along the way.
The Roots of Retirement Plan[t]s
My husband has always been a saver. He has told me the story of being given, in his 4th grade classroom, a passbook to Farmers and Merchants Bank. Every week he turned in a little money with the passbook, and a week later, he'd get the passbook returned to him with a new, higher balance.
In fact, my husband still has an F&M passbook from back in the day, but it belonged to his grandfather. Its entries start at March 18, 1937 and end at March 18, 1949.
That exercise in financial education, modeled by Grandpa, along with a mother who often spoke of being a Depression-era baby, and a father who taught the kids how to buy stocks, on a very small scale, got my husband on the road to being a good saver for the future. He hasn’t missed a beat all these years.
Me? I am lucky to have started learning from and with him. Being raised with parents who didn't save but who did have every credit card known to mankind, I took somewhat longer to get on board with this whole saving notion, but once we were married, I started to understand very quickly how important saving was to him and to our marriage.
In the early 1980s, we were some of the earliest consumers of that great new retirement product, the IRA. Later, as 401(k)s became available, we also put money away there. Most years, we maxed out our respective 401(k)s, and eventually we started maxing out IRAs in addition – even thought they were no longer deductible and we didn’t much like that! In the mid 90’s, we learned about DRIPs, and we got on board with those, too.
Doing all that wasn’t quite good enough, though. While we had the saving and investing habit, we didn’t have a clue about what we were doing and how best to manage that money that we worked so hard to save. My eyes were opened one sunny California morning in 2005. I was coming up on age 50, and I sat on my back patio one afternoon to take a hard, deep look at our collection of account statements.
Without going into a lot of excruciating detail about how freaked out I was, let me just say that was the day I realized that time was passing and we were getting too old to be messing around with so many aggressive investments; I could see what a toll those investments – and the ignorance about allocation, diversification, and re-balancing –- had taken on all those dollars so carefully put away for someday.
Someday was on the horizon. Nearly 50 years old, with a 52-year-old husband, I could see ‘someday'; it was right in front of me. That day we discussed a reallocation of our assets and started working on it, online, immediately. That reallocation saved our behinds a couple of times, and we have been fortunate not to have suffered the same levels of losses that have gutted the retirement accounts of so many of our Baby Boomer peers.
But I can see how people could so easily have lost so much. If we are taught to sock away all that money but don’t know how to manage it, then all those great retirement savings products are doing nothing but lining the pockets of those who sell them. That accomplishes only part of their purpose!
Just the other day at my local garden store hangout, I was speaking with my buddy there, one of their long-term employees. Somehow or other we got onto the subject of 401(k)s, and he mentioned that he had lost a lot of money and was still losing it. I mentioned that he may need to look at his investments and make some changes about how his 401(k) money is invested, but he said he had no choice in how to invest. He looked over at the cashier, who nodded her head in affirmation of his statement.
But I have to wonder: Can this be true? Does he really have no choice, or does he not realize he has choices? Not being a professional, nor even a close friend, I didn't want to pry, but I do worry for him.
And it’s not only the garden store where people don’t know about their investments; I have a close acquaintance who apparently isn’t really very clear about what her401(k) holdings are. I wondered whether she was being cagey about it because she didn’t want to disclose information to me. I could understand that. But no, she was perfectly willing to tell me how much money she had in the account; she just couldn’t talk about the kinds of investment choices she had. I don’t think she knows. She has a company-provided financial advisor who manages those things for her. I hope it wasn't Bernie Madoff.
Someone wrote somewhere that no one cares as much about our money as we do. Well, that ought to be the case, but unfortunately, I don’t think it is, and that’s to the detriment of many retirement accounts across the country.
Because gardening and spring are on my mind, let me end this post with a gardening metaphor:
The roots of retirement planning need to be set out early and deep so that the plants they produce are strong enough to weather the high winds that come up from time to time. However, just planting isn’t enough. You have to prune and tend those plants along the way for the best growth. Otherwise you’ll end up with a unhealthy or leggy plant – or a dead one – and you’ll have to go back to the garden center and start all over again.
Great for the garden center’s pockets, but not so good for yours!
In fact, my husband still has an F&M passbook from back in the day, but it belonged to his grandfather. Its entries start at March 18, 1937 and end at March 18, 1949.
That exercise in financial education, modeled by Grandpa, along with a mother who often spoke of being a Depression-era baby, and a father who taught the kids how to buy stocks, on a very small scale, got my husband on the road to being a good saver for the future. He hasn’t missed a beat all these years.
Me? I am lucky to have started learning from and with him. Being raised with parents who didn't save but who did have every credit card known to mankind, I took somewhat longer to get on board with this whole saving notion, but once we were married, I started to understand very quickly how important saving was to him and to our marriage.
In the early 1980s, we were some of the earliest consumers of that great new retirement product, the IRA. Later, as 401(k)s became available, we also put money away there. Most years, we maxed out our respective 401(k)s, and eventually we started maxing out IRAs in addition – even thought they were no longer deductible and we didn’t much like that! In the mid 90’s, we learned about DRIPs, and we got on board with those, too.
Doing all that wasn’t quite good enough, though. While we had the saving and investing habit, we didn’t have a clue about what we were doing and how best to manage that money that we worked so hard to save. My eyes were opened one sunny California morning in 2005. I was coming up on age 50, and I sat on my back patio one afternoon to take a hard, deep look at our collection of account statements.
Without going into a lot of excruciating detail about how freaked out I was, let me just say that was the day I realized that time was passing and we were getting too old to be messing around with so many aggressive investments; I could see what a toll those investments – and the ignorance about allocation, diversification, and re-balancing –- had taken on all those dollars so carefully put away for someday.
Someday was on the horizon. Nearly 50 years old, with a 52-year-old husband, I could see ‘someday'; it was right in front of me. That day we discussed a reallocation of our assets and started working on it, online, immediately. That reallocation saved our behinds a couple of times, and we have been fortunate not to have suffered the same levels of losses that have gutted the retirement accounts of so many of our Baby Boomer peers.
But I can see how people could so easily have lost so much. If we are taught to sock away all that money but don’t know how to manage it, then all those great retirement savings products are doing nothing but lining the pockets of those who sell them. That accomplishes only part of their purpose!
Just the other day at my local garden store hangout, I was speaking with my buddy there, one of their long-term employees. Somehow or other we got onto the subject of 401(k)s, and he mentioned that he had lost a lot of money and was still losing it. I mentioned that he may need to look at his investments and make some changes about how his 401(k) money is invested, but he said he had no choice in how to invest. He looked over at the cashier, who nodded her head in affirmation of his statement.
But I have to wonder: Can this be true? Does he really have no choice, or does he not realize he has choices? Not being a professional, nor even a close friend, I didn't want to pry, but I do worry for him.
And it’s not only the garden store where people don’t know about their investments; I have a close acquaintance who apparently isn’t really very clear about what her401(k) holdings are. I wondered whether she was being cagey about it because she didn’t want to disclose information to me. I could understand that. But no, she was perfectly willing to tell me how much money she had in the account; she just couldn’t talk about the kinds of investment choices she had. I don’t think she knows. She has a company-provided financial advisor who manages those things for her. I hope it wasn't Bernie Madoff.
Someone wrote somewhere that no one cares as much about our money as we do. Well, that ought to be the case, but unfortunately, I don’t think it is, and that’s to the detriment of many retirement accounts across the country.
Because gardening and spring are on my mind, let me end this post with a gardening metaphor:
The roots of retirement planning need to be set out early and deep so that the plants they produce are strong enough to weather the high winds that come up from time to time. However, just planting isn’t enough. You have to prune and tend those plants along the way for the best growth. Otherwise you’ll end up with a unhealthy or leggy plant – or a dead one – and you’ll have to go back to the garden center and start all over again.
Great for the garden center’s pockets, but not so good for yours!
Tuesday, March 22, 2011
"Elective" Part-Time Work -- Selfish?
Today while shopping at my favorite local garden center -- a place where I've spent some happy hours -- I finally asked whether they are accepting applications for part-time. It's something I've thought about for a long time: I love gardening, I've often thought how much I would enjoy working outdoors there, watering the plants, interacting with customers, and learning more about plants and gardening in general.
In response, I learned that just yesterday, they had laid off 3 people, those most newly hired, because business is so slow. (Hey, I have done my part there the last few days!)
After expressing my understanding, I loaded up my plants and drove home, wondering whether I might be selfish for even wanting a part-time job -- just for pleasure -- when others need those jobs to feed their families.
I spent many years in offices and also in academic settings, sitting and standing and using one part of my brain, the analytical part. I thought it would be great to spend this next part of my life in an outdoor setting, also using my brain, but in a very different way, focusing more on customer service.
I don't have a financial reason to work, or not yet, but I would like to find a way to keep learning and growing, and since I am looking for a paid position, there must be some other need I am trying to satisfy. I am not sure what that is. Maybe just ego.
I already volunteer as a senior peer counselor, and I've recently signed up to be a docent at a local regional park, in their nectar garden. Maybe that's all that will be left for me: volunteer work. People have told me that in my mid-50s, I am too young to volunteer, but maybe that's the only door that's still open.
Why doesn't that feel like enough? Maybe it just takes time. When one is 'accidentally retired,' rather than retired by choice, maybe there is some unfinished business that needs to be sorted through.
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