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Tag: Social Security

Retirement on a Shoestring

Sylvia Flores / 8 Aug 2017 / Personal Finance

Retirement? No. Work till your dead? Yes.

My father is older than my mother, although he is very much like the glamorous southern bell that admits his age to NO ONE. He had the tiniest pension in the world from his jet-setting career that may or may not have been used to purchase a house, and so, retirement is Social Security.

My traditional family halted dramatically when he chose to chase dreams rather than a paycheck. I mean, not that dad isn’t a show-stopping artist, because he is. And in his hay day, he was making some pretty large bills on paintings, because people used to have money to blow on art. Do you remember those days? You know, before the downfall of our economy, when we all had tons of (pretend) money?

Here’s a timeline of events:

  • Dad quits the job, becomes an artist, we move to Maui because Oregon’s economy went through a major bottoming out.
  • We live in a house the size of a shoebox (700 sq. ft.) and there are amazing amounts of tourist dollars from all over the world flowing through the island. Unrealistic sums of money. The kind you wipe your tears of joy with – if any of it was yours…
  • Hawaiian market bottoms out, my mother would like to be closer to her aging parents and sisters, and we move back to the family farm, which, if you are a Harry Potter fan, looks like the Weasley House.
  • Dad retires with a savings account in the teens (as in five-figures) and takes Social Security, which is well below the national average check of around $1,200 – in fact, it’s less than half of that.
  • Mom gets a job that she still works at today, and has a 401k plan through her work.
  • Health premiums are through the roof! Dad gets on Medicare, mom stops paying over $1,000 per month for his insurance.
  • Even with Medicare, dad and mom pay more in healthcare premiums than all other bills combined.

Okay, that brings us to a pretty current status. Mom works like a mad woman and supports my dad. She cooks, cleans, sews… all the stuff that moms used to do traditionally. She also has a firm grip on what it’s going to take to retire – for both of them.

Her 401k is the ONLY thing that ensures they have a future at all. Despite the fact that the market tanked and she lost over half of her savings – she spoke with her Advisor, and he said the following:

“Stay the course.”

Good advice. She did, and now her 401k has bounced back to where it was and on her current trajectory, she’ll be able to retire at around 66 (though she is going to try to wait to 70). Her house is paid off, but unfortunately, it is in the middle of nowhere, about 30 miles away from the nearest hospital, riddled with scary stairs, and lots of farm work…

I’ll tell you what’s going to happen. Our family is going to combine. Aunts, uncles, sisters, cousins, friends, whomever – we’ll live under one gigantic roof and combine resources. We’ll create the family compound and take care of one another. And it won’t be taboo anymore. Kids moving back home or parents moving in with kids will be the new show of success. If other countries can make it a successful go, so can we.

Mom. Dad. Pack Your Bags.

Sylvia Flores / 21 Jan 2017 / Personal Finance

I was talking with my Mom the other day. The conversation went something like this:

“I talked with my financial planner, and I am going to be able to retire by 66,” she said. “And when I asked him, how long I could live, taking the amount I need to survive, he said ‘forever.’

That may seem pretty wonderful, but like a whole lot of people, she is one dramatic health event away from ZERO retirement dollars. ONE! Well, she’d have social security, but that wouldn’t be enough to live on.

My sweet 79-year old Dad’s an artist and is collecting Social Security now. His income is super fixed—obviously, people don’t typically become artists for the money, even though he has work in museums. Death makes artists rich, not life. Typically.

The good news is that their house is paid off. The bad news is that they have a three-story house on a whole lot of acres that require a whole lot of maintenance and it’s out in the middle of Nowheresville. All I can think about is one of them falling down the steps with no one to hear their screams except wildlife that has no opposable thumbs or 911 dialing capabilities.

America? You could learn a thing or two.

I think a lot of people are in a similar boat. You know, the boat that is one petite iceberg away from busting in half and sinking to the bottom of the ocean? Americans could learn a lot from other cultures. For instance, how they live in multigenerational households and support one another.

Welcome to my Retirement Community! Now accepting Mom(s) and Dad(s).

So, when it comes down to it, I am not putting my parents in a retirement home. I am making them come live with me. Why? They did it for me! Plus, elderly people live longer when they are surrounded by things or people or pets that engage them and LOVE them.

I can be that loving thing/people/pet! And of course they are going to tick me off (and vice-versa), and likely on a frequent basis, but that’s what family is about, right? And the America we live in now is not one of huge wealth, pension plans, and lavish, resort-style assisted-living (unless you have one gazillion dollars.) And if you do, I doubt you are reading this blog.

How do you feel about the multigenerational household? What are you going to do differently, given the current (and sad) economic outlook?

The Fiscal Cliff of Retirement

Sylvia Flores / 24 Jan 2013 / Personal Finance

Are you as sick as I am about hearing the term “Fiscal Cliff”? Thanks media for killing me with that news every two minutes. Maybe we should rephrase it as the “Fiscal Apocalypse of Retirement”. Maybe that’s what the Mayan’s were talking about!

In all seriousness, people are going nuts. I have a friend who sold off all of his stock in Apple (which is his retirement) the week before the deadline because of crazy fear of said cliff. Here’s the thing. Your retirement plan takes something that Americans are no longer experts at. It’s this thing called “patience”.

Time + Patience = MONEY

We have officially moved into a “microwave society”—this term coined by my dear friend Chad Parks. We want what we want and we want it RIGHT NOW. In the game of retirement dollars, this behavior will—how do I say this nicely? Screw you over in the long term.

We need to talk.

No one—and I mean this—no one can predict the future of the markets (not even those pesky Mayans). You need to go about saving with the idea that the money you put away is untouchable. Don’t rob your future self. Your future self wants to have a great life when things are winding down. Put money in. Be patient. Don’t cash out for a new car or a house. And stop thinking that your house is a retirement plan. It’s not. Your retirement plan needs to be a separate entity that you love and care for and it takes PATIENCE!

Make a resolution. Stick to it!

There is a fiscal cliff of retirement (enter your retirement age here). If you don’t save, you will not be able to live comfortably. Depending on your age, Social Security may or may not be there for you—according to the Social Security Administration, it’ll be insolvent by 2034. Scared? And Social Security is not enough to survive on. You don’t want to have to choose between meals, medication, or a roof over your head!

So, what are you going to do in this New Year? I’ll tell you what I’m doing. I’m raising my contribution to 10% (which means I have a lower taxable income—double win!). I’m cutting back on frivolous things, and am securing my retirement future so I can sit on some foreign beach for the rest of my days, drinking wine and eating olives and cheese.

You have probably been hearing a lot about the ‘Fiscal Cliff’, our national deficit, the need to raise taxes and lower spending, the sequestration (whatever that is), and the debt ceiling (again).

Let me try and put this in easy to understand terms for us.

I recently came across an illustration that we can all relate to. Instead of talking in billions, and trillions, this illustration uses the magic of the decimal point and chops off a whole bunch of zeros.

Basically, this is the national budget; zeros removed to make it look like a household budget:

Household Income: $21,700
All Expenses: $38,200
Difference: ($16,500)

Amount to be charged to our credit card: $16,500

Existing credit card balance: $142,710

Amount the family has agreed to reduce their spending next year: $385

When stated like this, it makes much more sense, doesn’t it? Or no sense at all, depending on your stance.

This is what we are dealing with:

• Accumulation of massive debt over many years
• Earning too little to support our lifestyle
• Spending more than we are earning
• No will to change our ways

We need to declare enough! For the love of our country, our friends and family, we cannot continue like this!

We’ve been using the credit card when we should have been using the debit card!

We have been pickpocketed, and our credit card is in the hands of Congress, who, in what can only be described as a drunken binge, have run up a huge balance, Republican, and Democrat alike.

And there is another problem! Just like the borrowing limit on your credit card, we as a nation have a borrowing limit, and we have hit it – many times!

So what would you do? Rational, sane people would say wow; we really got ourselves in a bind didn’t we, we better work at cleaning this up.

Non-rational, not so sane people would instead call up the credit card company and ask for more credit.

In our national case, our credit card company is mostly China and Japan. How many more times will they be willing to take that call?

And Congress is calling on our behalf, asking for an increase to our credit card so they can spend more.

Not sure about you, but no one asked me if this is ok. No one from Congress has checked with me if I am ok with increasing the amount I have to pay for this party, and no one has asked me if I am ok making the payments on our national credit card.

I am not ok with it, and I want my credit card back.

The time has come to take control of our futures, and for us to care more! This is it, people, it’s not too late. But it will be soon.

This course is unsustainable. Never before in modern history has there been such a complex mix of a demographics, an aging population, a shrinking tax base, and such a lack of foresight. History tells us our empire will fail; we are close to crossing the point of no return.

Take action. Take control. Stop outsourcing our futures to 535 people in Washington who crave instant gratification, at all costs. Because, like it or not, we are all in this together, and if we do not take serious measures today, this party will be over – one and done.

What do you think about this? Do you get it? Are you pissed?

The Ant and the Grasshopper

Andrew Answers / 23 Oct 2012 / Personal Finance

Save like the ant

As winter slowly approaches, I am reminded of a comment my father often made to me: “Don’t be a grasshopper, son,” a reference to Aesop’s classic tale about saving and frivolity. My father always encouraged me to be like the ant, and work diligently while the summer sun still shone.

As the years’ progress, I now find myself in the late summer of my life. Though I am making hay while the sun shines, I know that many members of my generation and the one following are naught but hordes of grasshoppers, fiddling away their time. When do we really ever think about our 70-year-old selves?
Speaking about retirement to a 20-something is likely to get you a face full of “there’s time for that later!” To the 30-something, it’s likely to be more like “I know, I know. I’ll take a look at that on Monday.” But, by the time we’re 40-something, we’re in a mad dash to catch ourselves up.

But what if there isn’t?
As traditional retirement support systems like Social Security and pensions diminish, personal savings become the most important way to save. It’s here that lives the need for personal savings. Sadly, many younger individuals do not understand that $100 saved now in their 20’s will yield almost 40% more than $300 invested in their 30’s.

As Einstein was once purported to say “compound interest is the most powerful force in the universe.”
In the multi-media, instant gratification society where we live, it’s easy to identify with the grasshopper that spends its time loving the spotlight. Everyone’s a star in their own way. It’s what reality TV is all about. However, it’s the ant, the one of many that know the sacrifice now for survival down the road.
Even though we’re all stars in the global community, accountability for your own savings falls solely on you. Will you become the ant or the grasshopper?

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© 2018 Ubiquity Retirement + Savings / Privacy Policy
1160 Battery Street, Suite 350, San Francisco, CA 94111 / Support: 855.401.4357