Retirement HintsFor for older singles The 40-something female, single, with two children - one a senior in high school, the other just entering high school. If you are looking at this scenario, you are probably:
First of all assure yourself that you will be okay. What was it Franklin Roosevelt had to say - "The only thing we have to fear is fear itself." Nothing can be done or done well in an atmosphere of fear. So your first and most immediate task is to drag that dread out of the back of your head and put it full square on the table and let it know without any doubt whatsoever that it is not going to take over and run your life. Closing your eyes to the passage of time and its impact on your life is not the solution. Facing it full square is the key to the solution and you can face it and find solutions for a full, successful, meaningful life now and in retirement. If you have read some of the scenarios for younger people, you will know one of my basic premises is that you are in retirement what you are today, only perhaps more so. If you are full of fear and uncertainty, you probably not take any positive action to plan for your retirement, and you will continue to be full of fear and anxiety in that later important phase of your life. If you are confident in yourself and in your ability to succeed despite the odds, you will be confident in yourself and will succeed despite the odds in retirement. Let me give you some facts. As a woman, you are much more likely to experience retirement than a man. While you constitute a little over half of all of the population, you are 58% of the population 65 and older and 70% of the population 85 and older. Not only that, but the odds are greater for you than for a man that you will be single. 79% of men ages 65 to 75 were married compared to 55% or women in the same age group. Persons aged 85 or older about 50% of men are married compared with only 13% of women. These figures are from David Braze, a writer for The Motley Fool and their excellent series on "fools and retirement." You can find more at their website which is fool.com. I would encourage you to get a copy of this report and the rest of the series as well as a May 1999 report of the National Endowment for Financial Education paper entitled "Retirement Planning in the 21st Century: A Think Tank Sponsored by the National Endowment for Financial Education" available at their website. The gist of all this is that even now in your youthful 40-something years women need to anticipate a period of their life where they will be single and dependent on their own experience and resources. And you can do it, to paraphrase Helen Reddy, "We are women and we are strong." I was talking with a woman friend of mine who recently turned 50, is single, has a daughter going through a divorce, is struggling with trying to put together a career of her own and maintain a sometime relationship with a man she has known for a number of years, and is a practicing Buddhist. As we talked about life, the thing she stressed the most was the impermanence of life and that one's strength must come from one's own inner core. Despite the troubles she faces, including the recent death of her mother, she finds peace, tranquility and strength in her life because she has worked to develop that strength within herself. This is the message I have learned from her and from the many single women clients I have had in my life: planning is not about pushing a bunch of numbers around. Planning is about a clear look at who I am, accepting myself for who and what I am, right now at this point in time, rejoicing in that and at the same time identifying areas where I can improve, increase my strengths and self reliance and going about on a daily basis to do just that. Many women I have worked with have special challenges they face. Guided by a strong and internal care-giver instinct, they want to sacrifice everything to make sure the children have what they need for their future life or to assure that their now aging parent are supported and cared for. While commendable, these acts of self-sacrifice are not necessarily the best for anybody involved. The children do not benefit from continued enablement and have to learn, maybe even at this early age, that they have a responsibility to care for themselves and contribute to others. Continuing to sacrifice your financial resources, your time, your energy for the sake of your children is not what is best for them and certainly is not what is best for you. Remember the best gift you can give your children is to become a fully functional, self-reliant, independent person which will free them to become their best selves rather than having this dragging concern that they need to care for you in your dependency. Yes, it is too bad you are single. And probably don't have the income you used to have when you were married, and the children's lifestyle is going to be affected because of it. That's the way it is and your sacrificing everything to try to make up for it isn't the solution. Dealing with life on life's terms is a lesson that needs to be learned and the sooner the better. And creating a false sense of financial prosperity by sacrificing your financial future is not helping them with that task. I know this is hard. It has been for many of the women I have known and worked with. But, believe me, in the long term helping your children to become partners with you in providing for your family financial security will benefit them and yourself in the long run. I started out by talking about fear and how we have to face fear and move on because if we work in a fear-based atmosphere we will make poor decisions. A book I highly recommend to everybody but would especially recommend it to you if you haven't already is Richard Carlson's great little book, "Don't Worry, Make Money - Spiritual and Practical Ways to Create Abundance and More Fun in Your Life." This author of Don't Sweat the Small Stuff gives you 100 ways in which you can achieve abundance but over and over again he will point out that worry and fear are your biggest enemies and you need to operate out of an inner self of confidence and assurance. Many years ago Harris and Berne developed a transactional approach to psychology, more commonly known as "I'm OK, You're OK." The basis for this approach is "I'm OK." A not OK person has real difficulty in establishing relationships of any kind which are OK. So your first task is to be OK with you. You must love yourself first before you can love others. If I seem to be harping on this incessantly in a scenario that is supposed to be about planning for retirement, it's only because my experience and knowledge tells me that unless you become OK with you, unless you dispel worry and anxiety and fear, you will, I hate to say never, but certainly the odds are that you will not have a very successful, financially independent, satisfying or meaningful later life. On the other hand, if you do create that inner core of strength, of confidence, I likewise believe that the odds of you having a financially independent, satisfying and meaningful way of life will be much greater. You see, one of the things I know is that a financially independent, satisfying and meaningful life is not necessarily equated with a lot of money. I can remember when I was executive director of the Wisconsin State Commission on Aging and I was talking with a lady in her later 70s who was eking out a substance with Social Security. We were in a grocery store. She had purchased her few goods and she and I were talking in the line waiting to be checked out. Naturally interested in older people, I inquired as to how things were going for her. She proceeded to tell me they were just fine, thank you. She went on to say, "Oh, I don't have much money but I have enough to buy what I need. I watch these younger people," she said, "and they buy so much and waste so much. I don't need to do that. I don't need that." she said, "I have all I need and I am grateful for everything I have. I do just fine, thank you," she said. That really made an impression on me. She faced life with confidence, with joy, with a basic understanding of who she was and where she was in life and accepted that with joy. I have dedicated a good share of my life to trying to help people have sufficient resources both as a leader in government and as a practicing financial planner. But the one thing I know is that I cannot create true meaning, satisfaction and joy for people in retirement. That's your job. And you don't have to wait until retirement to reap the benefits of this inner strength, this core of confidence, this lack of worry and fear. You can use it today! Are you not getting paid what you should for the job you are doing, or perhaps what some of the men doing the same thing are getting paid? Don't put up with it! Assert yourself, challenge the establishment. Demand what you have a right to receive. Fair pay for the work you do today. And you can do that because you know your strength, you know your goodness, you know what you do contribute and if this employer isn't wise enough to recognize it, there will be somebody who will. When I was talking to the 20-somethings, I mentioned that their primary task was to individuate...to separate themselves from the crowd. To get to know who they were and what their strengths were and to begin to develop themselves truly as an individual. That's a process that continues throughout our life as we explore and get to know ourselves deeper. And all of our strengths build through our experience and education. One of the tasks that faces you is to deal with an assumption that still seems to permeate some segments of our society, even though we talk of equal rights and equal opportunity. Some standards that say your role as a woman is to have someone take care of you and likewise to have you take care of others. To care about people is one thing; to take care of them is another. We help and support each other...but bottom line, it’s our job to be responsible for ourselves. And an attitude of gratitude, using our strengths and overcoming our obstacles is the best prescription for a successful retirement. Before closing, we need to bring up those usual topics of retirement planning, taking care of your health, building a foundation of interesting, challenging activities to stimulate your mind, body and spirit, maintaining and building relationships with others, and of course, creating that financial security you will need that will make retirement possible. You know women live longer than men. You probably also know that while they life longer, they don't live as well health-wise. Check out insurance company rates for things like disability income or health insurance. Those rates aren't more for women just for the fun of it. They are more because the experience is worse. They have more claims. Good health doesn't just happen. It has to be worked at. There are some of you that God has given a wonderful constitution which just goes on and on and on, but for most of us,we need to take care of this physical body. What does that mean? You know. Proper diet. Especially look at the role of food in your life. And the kind of food that you eat. Do you turn to food as a way to escape some of the troubles you are trying to deal with today? Do you seek that little shot in the arm a big dose of sugar gives you? Many women I have talked to in their 40s express concern with the ever-increasing dress size, the lack of flexibility and aching body. Not to mention the trauma of going through menopause creating additional hardships. But don't despair. Remember don't worry. Create abundance in your life. You can create physical abundance by just being aware of what you eat and why you eat it. Set up a good diet and stick to it. I don't mean starvation. And I don't mean deprivation. I mean reasonableness. Balance and responsible eating. And maintain your body with good, sound exercise. Many jobs today do not give you the kind of physical component you might have been used to years ago. Good balanced exercise. Walking, some reasonable home calisthenics or if you are so inclined, membership in a gym on a sustained, regular basis can help keep your muscles trim and together with a diet can keep those dress sizes down. You know that. The only thing you need to do is to make sure you do it. I can't do that for you, only you can. And keep on learning. I am such a believer in the fact that we need to continually use our brain to challenge ourselves, to stimulate ourselves. To learn new things. In one of my talks, "How do you spell success?" I ask my audience to close their eyes and to recall the dreams of their childhood, those wonderful things they wanted to be and to do. Then, set out a plan to make those dreams reality. We die without our dreams. Expand our interests. Desmond Morris, the anthropologist and zoologist, wrote in the Naked Ape that man, the species, is a stimulus-seeking animal. We need challenge or we can't survive. This is an anthropologist talking, based on his knowledge of our roots as living beings. Take away challenge, take away the stimulus of learning, of growing mentally and we will die. Or, we might just as well be dead. And these interests lay the groundwork for on going interesting relationships. Just seeking relationships is empty. Common interests tie them together and provide the cement to keep them going after the initial attraction is worn off. Make friends a priority. My best friend and I meet every Sunday night at 9:00 p.m. every week even though we may see each other during the week. It is our way of putting our relationship on a high priority in our lives and we have been doing it for 15 years. I am not going to talk much about housing or where to live in retirement because you are still a ways off and your life situation today is different than it will be when you actually do retire. But just a couple of pointers. As you think about where to live in retirement and you see your children graduating and going out into the world on their own, you will come to see that you may not need all the space that you had in the past and can use the money that's tied up in your property more advantageously. Moreover, there are some special tax benefits that you can get once you reach age 55 and sell your homestead. But my advice is to take your time on this decision. What seems to make sense financially may not make sense psychologically. Really think through what does it mean to you to live where you live, the way you live, today? And think through very carefully the decision to pull up roots and to move where your children live to be near them. We live in a very mobile society and where your children might move to initially isn't at all where they may live five years from then, or ten years from then. Be careful. This idea of housing and living arrangements is a big area of decision-making and the only thing I will say to you at this phase in your life is begin to be aware of some of the decisions you will need to make. But those decisions will be better made later on when you reach the 50's. Financial planning, that's what this whole series is about. Go back and look at the other parts of this website. There is an entire exploration of the fundamentals of financial planning available right here - for free. As part of this section on retirement planning, Florida State University with a grant from the National Endowment for Financial Education has pulled together a complete dossier of information about all aspects of financing your retirement. Read them over. Don't be like so many people today who are still drawing money out of their 401Ks or if they change employment are taking distributions from their retirement plans early or are not disciplining themselves to save funds outside of their employer's retirement plans. Read the earlier age profiles for some ideas. You still have a lot of time left. Remember the rule of 72. Money will double at the rate in which the interest rate you are receiving is divisible into 72. For instance, if you are getting 8% interest on your money, it will double every 9 years. Eight goes into 72 nine times. That means the money you save today will double and then probably double again if you can only get an 8% return on your investment. So you have time to quadruple the funds you are saving today and to continue to accrue money at a very favorable rate if you are just doing it today. A note to the men. If you happen to be 40-something and a man, I hope you don't mind that we have addressed this topic pretty much to women. Most of what we have said applies to you as well. You have different tasks, but the underlying theme is the same...work on your own inner self, creating the person you want to be. This was a time in my life when I really thought I was going crazy as I faced some very significant changes and went through my "mid-life crisis". The book that saved my life was Gail Sheehy's Passages. Then I understood I was going through a normal phase of my life and I had certain tasks I needed to accomplish in order to move on. You might also want to read her successor book, New Passages. Summary As a long-time planner, both financial and retirement, (what I today prefer to call living), I know we have tasks to accomplish and it is those psychological tasks we need to deal with that are going to be the greatest predictor of success in the later years of life. I urge you to dispel any fears you have. Do not try to plan on a negative incentive of anxiety and worry. Look into your own inner soul. Into your spirit. See what you find there. That person, that special unique spirit, is who you are. Created and blessed with strengths and skills and abilities. Recognize them, honor them and build on them. Put together a person you truly want to be, not the person your parents or significant others have expected you to be but your own inner longing for who you are. Recognize that, build on that, cherish that, celebrate that and the later years of life will be abundant, beautiful and full of joy.
James F. McMichael, Ph.D., CLU, CHFC One of America's pioneers in aging and retirement planning. Jim became a coordinator of a project on aging in Lansing, Michigan in 1957. Motivated by a personal experience he had had in watching his grandfather who had raised 12 children by working two jobs, only to end his life destitute as a result of a prolonged bout of cancer by his wife and forced to live with Jim's family. In this position, Jim soon became aware of the need to deal with all aspects of growing older in America in a time when we only had basic Social Security benefits, pensions were practically non-existent. There were a few scattered rest homes and the old folks homes that was the reciprocal of people who had no family to care for them. At age 26, he was recognized as a national leader in the field by being appointed executive director of the Wisconsin State Commission on Aging. Serving as a delegate to the 1961 White House Conference on Aging, being part of a select group who were charged with the responsibility of developing a national policy for the aging under the ageists of the Department of Health, Education and Welfare, and being appointed as an initial member of the National Advisory Committee on Aging, created under the Older Americans Act of 1965. His recognition of the need to expand people's awareness of and ability to plan for retirement increased and after having done several studies of retirement, he left the Wisconsin State Commission on Aging to found his own firm, Complete Retirement Service, Inc., which combined the creation and administration of pension and profit sharing plans for its corporate clients with a full range of pre- and post-retirement counseling. Named as an advisor to the section on Employment and Retirement to the 1971 White House Conference on Aging, Jim co-hosted a series of conferences at the University of Wisconsin on "Tools and Techniques for Retirement for Pre- and Post-Retirement Planning," a successful series of programs which was repeated over five consecutive years at the university. As director of the experimental marketing project and ultimately president of all investment subsidiaries of UnionMutual Life Insurance Company, now UNUM, Jim developed many new and innovative ways to assist people in meeting their financial and retirement planning needs. Following a five year stint in the corporate world, he returned to his own financial planning practice in Madison, Wisconsin where he attained a registered investment advisors license and provided extensive financial and retirement planning in his successful firm which continued until 1983. After an abortive attempt at retirement at his age 50, Jim went through some significant life changes, entered Florida State University's School of Political Science, obtained his Ph.D. in 1991 and has continued as a trainer and author in the management fields. He is the Program Director of the Certified Financial Planning Program at Florida State University and is an author and regular consultant and lecturer to many Florida and national organizations. He is the author of The Spiritual Style of Management: Who's Running This Show Anyway, available from Spiritfilled Press, Inc. |
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Jim McMichael is an adjunct professor for Florida State University and has served as a Public Management Associate with the Florida Center for Public Management, where he is involved in management consulting in addition to the delivery of the Certified Public Manager training courses.