How are you living with consequences of not planning for future?

M

Mr X

New Member
Hello, folks!

Quick summary:

I'm 55, my wife will turn 60 this year. I have worked in IT industry for 30 years - the kind of jobs with good salaries, but a DIY approach to retirement savings. Result: I have no 401, no IRA, no pension - nothing. I'm still working, making more then I ever have, but it's only a matter of time before I'm replaced by a new grad. My wife works as an aid for the school district. The pay is terrible, but insurance is good and there is a retirement plan that will pay about $400/month if she were to quit in two years, a bit more as time goes on.

We have no savings. Debt consists of a couple credit cards and an IRS payment plan - about 5K total debt. Equity in our house is between 50k - 100k, depending on who you ask (neighbor just sold his place for top dollar, so I'm figuring 70 - 100 is more realistic.) There is still an eternity left on mortgage. Monthly housing nut (mortgage, insurance, taxes) is about $1150, which is less than a decent apartment around here.

My wife has diabetes (manageable) , so health care costs will be an issue. That is why her benefits more than compensate for low pay (plus she gets summers off). Health care won't be an issue for me, as I have decided to make my unhealthy lifestyle a part of my exit strategy. I don't go for preventative tests and will let nature take it's course. We don't have kids, so it's not as selfish as it may sound.

I've read all there is to say on how to "fix" our situation and, frankly, it's no help. If I was able to keep my current job, at my current salary for 10 more years and put 30% of my gross income into an employer-matched retirement fund, then, yes, there would be hope. Unfortunately (as stated in paragraph 1) that's not realistic.

So I guess I am asking for stories from the trenches. I'd like to hear from people in my position who are little farther down the road. Did you find a way to make enough money to keep your home and downsize your lifestyle? Did you buy a trailer on a big lot in some rural local and live cheap? Did you decide to live in a van? Where still able to move back into your parent's basement?

I don't mean for this sound flippant. My wife and I have obviously put ourselves in a terrible situation, but I'd really like to find some options other than "start eating cat food now and put rest of your $ in a company sponsored IRA."
 

IMO you and your wife need to adjust your lifestyle to fit your estimated retirement income now and bank your surplus earnings over the next few years to serve as a cushion in retirement.

I would also encourage you to take care of your health because your current exit strategy may turn out to be slow and expensive.

If over the next few years it becomes clear that you can't adjust your lifestyle to your retirement income then IMO the only option is to look at semi retirement and continue working.

or you can relax and take life as it comes.

titanic3d1.jpg


Good luck!
 
Sorry, but I think as long as you are physically able, you will just have to continue to work. Sounds bleak, but there you have it.
 

I was downsized at age 59 and that was a crash course in frugal living. It was during a recession and I wound up with a crap job until the mortgage was paid off and I retired at 63. I believe in "do the best you can with what you have."
 
Hopefully I will be able, one day, to answer the question I posted.

Trust me - I understand the disdain that some (many?) of you feel. It must be galling to have scrimped and saved, only to see people who never worried about such things end up landing on their feet.

Maybe my wife and I aren't typical. Yes, we wasted all of our money, but I look at how we live and realize it could be SO much simpler without being that much "different," if that makes sense. It's probably not possible to change now, with a house full of "stuff" and a regular nice paycheck. But, taking equity from current house, moving to a small town and buying something cheap - I see many things I love for under 100K - it probably wouldn't take much more than my wife's pension and social to cover the basics. I find it hard to believe that 30 years in a white collar profession leaves me only qualified to stock shelves at Dollar General - although that kind of sounds like a welcome change.

Anyway, I'll keep waiting to hear from people that have made this transition, but I'm fine if you want to hector or vent. I know I have a lot to learn!
 
Falcon said:
Mr.X, Did you think that somebody ELSE would do this for you?

Good luck. There's always welfare & food stamps to keep you alive.
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No, I actually thought that paying taxes and into social security for 30+ years meant something. Silly me! (and don't worry, if welfare and food stamps are an option, at least I've already paid for them!)
 
Aunt Bea said:
I think we've all made the transition and Manatee summed it up very well! "Do the best you can with what you have."
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Absolutely, or you wouldn't all be here. (I guess I'm part of a new wave of post-baby boomer seniors - we were never quite satisfied with the answer "...because that's just the way it is.")

Figures show that my wife and I are actually better off than the majority of people our age. Like it or not, there are millions more people just like us who aren't going to be "OK" with paying into the "system" for their entire careers, only to be called "welfare mothers," and told to go live under the nearest bridge. I suspect my questions are the tip of the iceberg that sank the ship, above..
 
like was said do the best with what you have, you are like so many other working stiffs, pay off debt, save all you can, learn to live on what you have. it is not having what you want its wanting what you have.
 
Mr X said:
No, I actually thought that paying taxes and into social security for 30+ years meant something. Silly me! (and don't worry, if welfare and food stamps are an option, at least I've already paid for them!)
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Paying taxes into SS for 30 years means exactly the same for you as for anyone else; you will be eligible to receive a benefit according to the schedule of earnings.

And FYI, many of us here are the same ages as you and your wife.
 
ronaldj said:
... it is not having what you want its wanting what you have.
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So true. When we were recovering from the fallout of the crash (we stopped paying credit cards and eventually got sued - repeatedly) someone on a forum dedicated to fighting such matters said "it sounds like you need to simplify your life." Truer - and more valuable - words were rarely spoken.

After reading responses in this thread, I found myself talking to my wife and having an anxiety attack. Then a moment of clarity struck - this isn't a "retirement" issue: I am more than willing to own the fact that my poor planning means I probably won't be playing golf everyday when (if) I turn 72.

What I have a problem with is that NOBODY said anything about life ending at 55. It looks like this scare has done us good - my wife is looking at properties with an eye toward affordability versus curb appeal, and I am going make a concerted effort to stay in my chosen field until at least 62. I probably won't make same $, but I'll be a better deal than some young whippersnapper... :p
 
Mr X said:
Absolutely, or you wouldn't all be here. (I guess I'm part of a new wave of post-baby boomer seniors - we were never quite satisfied with the answer "...because that's just the way it is.")

Figures show that my wife and I are actually better off than the majority of people our age. Like it or not, there are millions more people just like us who aren't going to be "OK" with paying into the "system" for their entire careers, only to be called "welfare mothers," and told to go live under the nearest bridge. I suspect my questions are the tip of the iceberg that sank the ship, above..
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I guess I'm not understanding what you mean by this. Are you expecting some sort of bail-out because you failed to plan? Everyone I know has paid into the system for their entire working life and I don't know of anyone who has been called a welfare mother or told to live under a bridge. You will be entitled to benefits according to your earnings, just like everyone else.

Work for as long as you can, and save as much as you can. There is no magic.
 
I think most retirees fall into one of two categories.....1, being those who recognized that they too would some day grow old and retire, and managed their finances accordingly....and 2, those who lived only for "today", and gave little thought to what the future might hold.

I am often amazed at some of the reports I read about how little some Seniors have managed to set aside for their retirements.
 
Start with a strict budget. Maybe not cat food but beans and rice.
Max your 401k as allowed by IRS for your age as this is free money from your employer.
Start a Roth IRA with max contributions for both you and your wife.
This should save you over $100,000 in the next 5 years.
Stop living beyond your means now and put away as much as possible.
Continue to look for a cheaper place to live.
Yesterday was the past. Begin your future. Good Luck.
If you have expensive cars sell them and buy down.
 
Even though credit card debt is low pay that first and tear them up. If you need credit go to a prepaid card.
Sorry no one taught you about realities of life but it's no excuse as you know.
Start listening to the Dave Ramsey show. He will have no sympathy but tells it like it is and will be helpful. You need a plan.......NOW.
 
Sell your house full of stuff and your house, now. Downsize, radically, and actually write a budget. Stick to it, come Hell or high water. Shred your credit cards. I planned ahead from the time I was in my twenties. I'm amazed how so many smart folks, earning very big bucks, live so high on the hog, only to be in miserable shape, financially (often physically, too) once they reach their fifties, and beyond, for lack of even a little foresight. Forget your pity party. Take action, now, and you should be OK in the near future, although you won't be living the lifestyle that got you into this predicament, in the first place. That'll be good for you, in the long run.
 
{shrug} OP, do you have any children?? My plan is to move in with my son and DIL when I run out of money. I supported him for 18 years, now it's time for pay back.

Which reminds me, do any of you have a pickup truck that I can borrow next weekend??
 
For me, I never once thought about my future and, due to my low job hourly salaries, I basically couldn't save any money if I wanted to. Working in warehousing, ship/rec and stockroom definitely doesn't pay much, unless it's for a big/major company, of which I never worked for. I pretty much lived week-to-week on what I made. Only two jobs I had that I stayed for more than a year and each one I stayed for 4 years. I don't agree with people, like my brother, who retired from the state of PA Heavy Equipment Dept. after some 30 years and gets a darn good pension, "stay on the job, no matter what, and get a good pension (or today, a good 401K). That's all fine and dandy if a person really likes there job and boss, the company doesn't shut down or the person gets laid off.

My wife has done much better than I, but then again, she has two AA Degree's and a Bachelor's in Business/Accounting. Her salaries were much, much higher than mine ever was........even before I met her. Like myself, she has switched jobs quite a bit......quitting and being laid off, BUT, her salaries have allowed her to save. Unfortunately, when she quits her existing job next year, so we can move, we will both only be on SS and savings. Right now, we are living quite nicely, due to her SS, job salary and my SS.
 
I just gotta step in and say

GREAT THREAD!

Many good thoughts
great advice

Oh, and Mr X, yer thoughts are spot on, no gloss, lucid

you got this
 
Mr X wrote


Quote


"I have worked in IT industry for 30 years - the kind of jobs with good salaries"
"I have no 401, no IRA, no pension - nothing. I'm still working, making more then I ever have,"


Well written and pretty obvious access to the internet to look up a ton of info on retirement cost & advice.


My only recommendation would be to plan a day out with his wife to visit homeless shelters, talk to people pan handling that are homeless living in the street. Get a real sense of what they could face. Nothing like a dose of reality of having little to live on.
 
C'est Moi said:
I guess I'm not understanding what you mean by this. Are you expecting some sort of bail-out because you failed to plan? Everyone I know has paid into the system for their entire working life and I don't know of anyone who has been called a welfare mother or told to live under a bridge. You will be entitled to benefits according to your earnings, just like everyone else.

Work for as long as you can, and save as much as you can. There is no magic.
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As I said earlier, I totally own the fact that I won't be playing golf everyday at 72 due to my lack of planning. I also have no problem making it to 62 and being set up to live off my benefits. My concern is the constant talk about social security "going away."

I see people living on the street. I know people from that world. They all share a toxic combination of drug addiction and mental illness. But, the very real fact is that there are millions of people, like me - normal, working law abiding folks - who planned on living off social security. Ever try picturing what it would look like if this group is suddenly denied those benefits? I'd suggest watching a few episodes of "The Walking Dead" to get an idea.

Again, it sounds like this is a conversation that needed starting - thank you to everyone that is taking part!
 
I think too many people have the mistaken impression that Social Security is sufficient to provide a sole means of support in one's retirement years. They either didn't or couldn't take responsibility for saving additional funds for their retirement.

It has been widely discussed for several years that Social Security is in trouble. I doubt that the program will ever be discontinued... but we will undoubtedly see major changes happening as more people retire and begin collecting benefits. I imagine there will be means-testing instituted at some point to scale down payout to more affluent retirees. I think that sucks because they are the ones who likely paid the most into the tax but could potentially see their benefits reduced.
 

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