Monday, February 19, 2018

Let's Talk About Retirement

I am currently, unofficially, semi-retired.  While hubby is fully retired, complete with pension and Social Security, I am too young for any of that for a good decade or more.  So we easily get by on his retirement funds and my freelance earnings and all is well...for now.

BUT...and it is a big BUT, I am really really concerned about retirement-and not just my own--in the next 15 to 20 years.  Since nearly all of our friends are retired and have been that way for years, I see how generous pension programs, long-term investments, and having multiple streams of retirement income coming in can make for a very comfortable life after your working years are done.  On the flip side, when I worked in social services, I saw what happened to people who for one reason or another didn't have such a good plan for their retirement.  Often these people received only a tiny Social Security check each month and that isn't very much income at all.

I think within the next couple of decades, a comfortable retirement will be out of the reach of many more people.  As states like Connecticut are wrestling with mounting pension debt (there is NO WAY the are going to recover this money IMHO), and other states have already been hacking away at pensions (money that retired folks were dearly counting on in their retirement), it doesn't seem like anyone is safe.  Social Security is already on shaky ground, and many state, county, and city pension plans are teetering on the brink of bankruptcy (there is two parts to this; one is the pension itself being under/unfunded and heading for bankruptcy once the fund runs out of money, and the second part is that the company that acts as "insurance" for pension funds--the company that is supposed to pay out for bankrupt pension plans--is running out of money and will soon be bankrupt itselfThis is a concern not only for retirees but the government as well.

Fewer and fewer people are getting cushy pension plans with their jobs these days which means fewer and fewer people are paying in to support the cushy pensions which were guaranteed to employees years ago.  It just makes me wonder what will happen in the future.

Just Googling "pensions in the future" turns up all kinds of negative news--from the generation that can't afford to retire to "the disaster that's waiting to happen" to 'what will happen to Chicago retirees when (not if) pensions dry up'.  Yikes!

I know I need to be more proactive about planning for my own "official" retirement but it seems pretty dispiriting to consider all of my retirement "options" or lack thereof.  Social Security?  I have paid into it of course but doubt it will provide much more than a pittance in the future.  A pension from work?  Nope, none as I have been a freelancer most of my working life.  Rely on hubby's retirement income?  When he is alive it works fine but he is 20 years older than I am and if he dies before me I will be...I don't know where I will be.  There are age restrictions on drawing a spouse's Social Security (which I found out when a lady came to our office, her husband had suddenly died, and she was 50 years old, in other words way too young to draw any sort of Social Security from her own or her husband's work, she hadn't worked in decades, and she ended up in a very unfortunate spot...I think she still lives with her adult children) and I won't get any of his military pension after he is gone either (electing for the military's SBP plan at 20/40 years old wasn't even on our radar). 

So I need to get busy on my retirement planning.  I hope to have a paid off house in a few years and continue branching out with freelance projects but other, more tangible planning options remain nebulous.  Stocks?  Bonds?  Mutual Funds?  Real Estate investments?  At my age I feel like betting a large sum on black would be just as effective  :(


  1. My hubby is 7.5 years older (I am 48 and he is 55). I have some of the same fears. Right now we have our own Company that we both work at. We live in Canada..I don't fear not having our Canadian Pension (collectable at 60) or Old Age Pension (at 65) as I think that is pretty stable here. Hubby worked for a company for 17 years, many of those in Management. When he left he had a choice to take his pension with him to self-invest or leave with the company. He took and it he manages it. He can therefore leave it to me/the kids in his will if something should happen to him. Because of our self employment we have decided at this age to invest in primarily dividend paying investments inside and outside our retirement funds. That way we have multiple streams of income. We are also collecting his Canadian Pension at 60 the second he can (at a reduced amount) and then plan to work part-time with our business if he still feels like it or me part-time if he doesn't. I think when you are self-employed you have to think outside the box, likely you will feel like doing freelance work after most people retire as the stress isn't there like working for someone else

    1. Thank you! That is good information. I know a few people who self-manage all of their investments and do quite well with them I guess it just comes down to taking the time to learn about all of that stuff and putting some effort towards it every day (it just seems so overwhelming to me!).