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!