Miscellaneous Ramblings About Retirement

Annie and I have had a pretty good ten or twelve days. The fun started on October 4th. We went to Newport, RI, for the Audrain Motor Week, which included the Concours d'Elegance on Sunday the sixth. We spent a few nights in Newport, even though we live 45 minutes away, I didn't want to drive home in the evening after several martinis. Although the Concours d'Elegance was spectacular, and Jay Leno and Donald Osborne were great hosts, my favorite experience was the Saturday afternoon seminar on car design ... my passion. And since Annie wasn't joining me for that, I found a seat in the front row, next to a great car guy: Ken Lingenfelter, head of Lingenfelter Performance Engineering (cousin of the late, great John Lingenfelter). I didn't know him from a hole in the wall when I sat down. But prior to the seminar's start, Stewart Reed (head of transportation design at Art Center College of Design in Pasadena) started talking to him. Stewart was a speaker in the seminar. Well, I had met Stewart a few years ago, so the three of us had a great conversation about the Fisher Body Craftsman's Guild (in which the three if us had participated in fifty-plus years ago). Anyway, a good time was had by us. And then Ken Lingenfelter and I became friends. Jeez

Then, on Monday, Annie and I returned home (45 min) from Newport, and then promptly traveled to the Grand Hotel on Mackinac Island in Michigan for a fun vacation. It's great to be retired.  We just returned from that trip. The reason for posting this? I stress to you: plan for retirement. Don't spend all your spare income on project cars. (Well, maybe one). Invest, invest, invest for retirement. I didn't start out wealthy. (I was dirt poor fifty years ago). I enjoyed cars ... my hobby. But I didn't spend everything on my hobby. I invested in my future. And now I'm enjoying it. And it's great fun to hob-nob with notable people in the car world, especially if you can talk intelligently with them.

Believe me, I am not boasting. I am just stating how happy I am to be where I am today by leading a very fiscally conservative lifestyle for the past fifty years ... and now cashing in on it! I would like all of you to experience this as well.

Did I mention that that we're off to Palm Springs, CA, for a couple weeks next month? We love Palm Springs. Great weather, great desert and mountain hiking, and the Keith McCormick Classic Car Auction. Yeah, one of these days I'll buy something there.

That pretty much sums up my seventy years on this planet.

Consider you and the misses respectfully envied. My retirement plan is death.

Appleseed said:

Consider you and the misses respectfully envied. My retirement plan is death.

Yeah, same here. I went all on buying a veterinary practice in 2007. Right before the Great Recession. My bankruptcy runs out in 2022. I'll turn 67 that year.

Thanks, Wells Fargo. 

There is always a bit of luck, good and bad, involved with everything, but you should always do your best to bend the trend line as much in your direction as possible.

I think Gary’s primary point is that retirement is something you should think about as early in life as possible.

I have wondered if those with effectively assured retirements (pensions, gov / military) tend to be a bit less financially responsible, since it’s not really required.  They of course would still benefit from some early planning.

It also bothers me a bit when they talk to people who are successful and their advice is you need to take a chance to really succeed.  Yeah, well they are clearly talking to someone who that worked out for, what about all those that it didn’t?  Would they have been better off taking a bit more conservative approach? (No insult intended Doc, sounds like you just had some sh#t luck in timing) I am sure all of us have run into people who seem to continually be looking for the “next big score” and never seem to find it.

In reply to Appleseed :

similar.  Boots first.  

This is incredibly good advice. 

I spent a long  time investing conservatively, but fell away from my healthy routines. I am now facing retirement, and dependent on an inheritance to be able to retire at all. 

It feels awful. 

$10K invested conservatively annually for 10 years can be worth $179,000. There is no reason that most people can’t make a reasonable  effort to prepare for retirement. 

Thanks for the positive reminder. 

In reply to SVreX :

I wish we had a spare $10k to invest annually. I mean, I suppose if we lived off ramen & lived in a trailer in the woods we might be able to. Hell, I just wish I could have afforded to start investing in my early-20’s.

Truthfully though I’m just thankful we finally got past living paycheck-to-paycheck. That’s such a struggle for so many people. 

Been out for five years, took me over a year to NOT wake up at 4:30 am.  Trish and I were lucky with the retirement program, 2% of pay for every year of service.  I had 42, she had 40 years =  ~80% without working.  Factor in no commuting costs, no lunches to pack blah blah blah, it is eventually everything you've heard.

She wants to buy a motor home when the plane sells, travel a bit.  OK.  Save everything you can while young and invest.  Good luck.

Dan

3 more years.

I'm lucky (and cursed) to be married to a woman who is constantly worried about retirement. A couple of weeks ago she had me go through the stacks of retirment stuff she has. We will have the house paid off in 2 years and we haven't had a car loan in 7 years. Using one of the Voya calculators, she will be able to retire at 55 and make more per month than now (by quite a bit) using EXTREMELY conservative estimates.  Using their defaults it gets better. It's also why I only have one project (usually) at a time. We love travelling and want to be able to do it as much as we want. 

That said, it is very frustrating at times when I see our account balances and think "But think of all the things I could do with that!" but slow myself and remember that I get all the things I want I just have to wait until we can pay cash. It's a great way to do things but being impulsive like I am it's hard. 

I was doing it right when i was younger, i had a nice IRA that they told me was totally safe.  Then the market tanked, recession happened, and i got a statement that my IRA was worth $0.    Now I just have a savings account, because I don't trust the market bubble, and am going to have to make money till i die, hope one of my kids hits it big, or that when my wife's dad kicks it her mom doesn't blow all the money before she follows suit.

it's not fun being in the first generation where pensions really aren't a thing.  Much like social security, they were a pyramid scheme relying on more new blood to pay for the old guard to be fat and happy at 62.  It was always "get a good job with a pension, look at your grandfather he gets like 35k a year retired" now it's like "yep even the state government is looking to kill its pension plan system" 

I don't know what I'm going to do,  my body can't keep up the pace, I cannot find reliable people to hire to do my job, and there is nothing waiting for me except whatever is left when the previous generation dies and I don't want to think about that.  

In reply to SVreX :

I've put about 20% away for the last 10 years (401k plus an HSA that I don't use) and while I have a decent amount in my accounts, at 49 I still don't feel entirely comfortable.  I still spend too much on my hobbies (cars, bicycles and guitars) and need to unload a bunch of extra crap sitting around.

Patrick said:

I was doing it right when i was younger, i had a nice IRA that they told me was totally safe. Then the market tanked, recession happened, and i got a statement that my IRA was worth $0.

I'm confused on how that happened?  Everyone with retirement accounts lost something during the recession, but staying the course recovered those losses and then some.

In reply to Ian F :

I don't know if the place i went through was shady or what, but they said my account went to zero and closed it.  Maybe they stole my money, maybe they invested it in extremely risky stocks to show above average growth, but it's long gone

aircooled said:

It also bothers me a bit when they talk to people who are successful and their advice is you need to take a chance to really succeed.  Yeah, well they are clearly talking to someone who that worked out for, what about all those that it didn’t?  Would they have been better off taking a bit more conservative approach? (No insult intended Doc, sounds like you just had some sh#t luck in timing) I am sure all of us have run into people who seem to continually be looking for the “next big score” and never seem to find it.

Survivorship Bias is something I think about whenever I consider quitting my job and starting my own business.  The few who succeed and make it big are far more visible than the many who fail.  And many times, they did the same thing, just had different external forces affecting them.  

I’ve been plowing money into my retirement funds for quite a while now and if everything goes smoothly, I should be able to retire between 55-60.  However, with a father who died at age 64, I often debate how well I am balancing living today with saving for the future.

how long before frenchy shows up to tell his tale of woe.   again.  

When I was college age, my mother would make me show her my bank book every payday. I was expected to put 80% in to pay for school and I could spend the remaining 20%. My parents were still supporting me as I went through university, so she had the right to demand that. I kept that saving habit my entire working life. I saved money every year except 1983 when I put a big down payment on my first house. I'm 67 now, and I've been retired for 11 years. My mother's insistence on saving has paid off nicely. I have always lived below my income level and put the difference away. Now, if I want or need something, I can have it. I hope my sons have learned the same lesson from me. 

His woe senses are tingling. 

In reply to Ian F :

With the wife being a teacher, we have the TRF that is (supposed to be) guaranteed pension still (new hires no longer are allowed to join if I understand correctly so this will be going away), her 403b's, my 401k and our two Roth IRA's. Our current plan, is once the house is paid off, the money we are currently spending on mortgage goes into those 4 main accounts. Right now that's about $2k per month for the (then) next 9 years. As long as we don't hit another deep depression that completely kills the global economy for the next 15 years we *should* be good. I'm not betting on it... and it's why I am trying to work jobs that don't kill my body daily. I'm not 25 anymore. 

In reply to Appleseed :

no doubt

Patrick said:

In reply to Ian F :

I don't know if the place i went through was shady or what, but they said my account went to zero and closed it.  Maybe they stole my money, maybe they invested it in extremely risky stocks to show above average growth, but it's long gone

Who did you use, Bernie Madoff?  Something is definitely wrong,  I lost a bunch too at the time, but it recovered way faster and more biggly than before.  I did have it in the retirement system the ACEC uses, so it was legit.  

Patrick said:

I was doing it right when i was younger, i had a nice IRA that they told me was totally safe.  Then the market tanked, recession happened, and i got a statement that my IRA was worth $0.    Now I just have a savings account, because I don't trust the market bubble, and am going to have to make money till i die, hope one of my kids hits it big, or that when my wife's dad kicks it her mom doesn't blow all the money before she follows suit.

it's not fun being in the first generation where pensions really aren't a thing.  Much like social security, they were a pyramid scheme relying on more new blood to pay for the old guard to be fat and happy at 62.  It was always "get a good job with a pension, look at your grandfather he gets like 35k a year retired" now it's like "yep even the state government is looking to kill its pension plan system" 

I don't know what I'm going to do,  my body can't keep up the pace, I cannot find reliable people to hire to do my job, and there is nothing waiting for me except whatever is left when the previous generation dies and I don't want to think about that.  

I don't see pensions as a pyramid scheme, but as a compensation device.  That was how companies lured people to work for them for the long, long term.  One of the reasons you see people change jobs so often now is that there are no longer golden handcuffs.  Anyway, it was part of the contract I signed, and my company promised that my paycheck would contiue after my service, which helps one take a lower annual check for the long run.

WRT your IRA- that totally sucks.  Like beyond sucking- and I would think they stole from you.

And to parrot what others have said, the key is to start early.  It’s all about compounding interest, just like the too big to fail banks do.  

In reply to alfadriver :

The problem with pensions is when the company steals it and says you really don’t have what you thought you had.  

spitfirebill said:

Patrick said:

In reply to Ian F :

I don't know if the place i went through was shady or what, but they said my account went to zero and closed it.  Maybe they stole my money, maybe they invested it in extremely risky stocks to show above average growth, but it's long gone

Who did you use, Bernie Madoff?  Something is definitely wrong,  I lost a bunch too at the time, but it recovered way faster and more biggly than before.  I did have it in the retirement system the ACEC uses, so it was legit.  

Agreed. Something really shady happened as that is definitely not common. The folks who lost their shirts were the ones who liquidated accounts for whatever reason when the market was at the bottom.  But my balance from that time has more than tripled since. A line-item in my account is a roll-over balance from a previous job. I use that as a sort of "quick gauge" for how the account is doing.

I've read the next recession is looming and could be a doozy, but these things are so hard to predict. Market pessimists have been predicting doom and gloom for over a year now. 

I expect my retirement to be totally secure for my "needs" but there to be a bit of luck involved for my "wants".   As a fed I get a small pension and a thrift savings plan (our version of a 401k).   They say that combining these with SS should take care of retirement fairly comfortably.

My job isn't physically demanding so I could theoretically do it for quite a while after I'm eligible to retire (another 10 years) and since I'm a fed I get ridiculous amounts of time off anyway.

There is a possibility that I could "retire" and start to draw my pension but come back as a contract employee and double dip for another decade.   My genes seem to indicate longevity so that's kinda nice.

And maybe a couple of inheritances but I'm not banking on them, just aware that they should happen.