Myth #15: I’ll Retire at 65 (part 3)

I encourage my clients to begin now to find work they love, regardless of their age. Baby-boomers’ parents did not concern themselves a great deal with finding work that they enjoyed. A job was required, and retirement was the reward for working for forty years. I have clients who have this mentality—they work at jobs they don’t like and tell me they “just need to hang on until retirement.”

They think they’ll just follow in their parents’ footsteps. They see their parents retire at sixty-five from long, successful careers, and begin a new existence of leisure. But is that going to work for us? It actually doesn’t even work very well for many of today’s sixty-five-and-over population, either. The search for a deep and fulfilling purpose in life spans all generations, and it does not have to wait until age sixty-five.

A couple in their late fifties both worked, owned a home and two cars, shopped where and when they wanted, and went out on the town whenever they felt the urge. In short, they had a lifestyle characterized by enjoyment now. They had saved some money for retirement, but not very much. They both wanted to retire at age sixty-five, and they asked me to do a retirement calculation for them.

I told them I wouldn’t do it. It would be a waste of their time and money. The amount they would have to save each month to be able to retire at age sixty-five and sustain their current lifestyle was more than their current disposable income.

I talked to them instead about finding careers that they could enjoy now—and could spend the next twenty to twenty-five years building and developing. I also talked to them about reducing their current lifestyle so they could save more toward retirement.

I asked them what they could do in retirement that might bring in $20,000-25,000 a year. The wife answered immediately, “I know what I’d do—go to work for a nonprofit organization as an administrative support person.”

Her husband was shocked. “You’ve got that figured out already?”

“You bet,” she said. “You tell me I need to earn $25,000 in retirement. For that, I’d go work at a nonprofit organization in an instant because—that’s where my heart is.”

There was no way she could live on so little now. The couple had financial demands far in excess of what such a job would bring in. But for her, it served to establish a vision of what she would be doing when she retires from her current job. It gave her something she could look forward to. It gave her some time to plan the means for this transition later in life. She could now begin developing the contacts that might make the transition to the nonprofit world go as smoothly as possible.

Knowing she has to earn that extra income beyond age sixty-five made her question continuing in her current job until retirement. She began to re-examine her devotion to a job she did not like very much—a job she had programmed herself to keep for the next fifteen years.

The time to take a close look at your retirement plan is now. How much are you saving a month, and how will that provide for you when you’re in your late seventies and eighties? Are you investing your funds for long-term growth? How much should you reasonably expect to receive from Social Security? If you are like most people, you’ll find that you won’t have enough to completely retire at sixty-five. In the end, you will be able to make withdrawals from your nest egg, but still have to supplement that with additional income from some type of work, at least for a while. Even though this may be bad news to some of you, it’s better to hear it now, while you can do something about it, and plan accordingly.

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