Retirement: A Full-Time Job

Confessions of an Early Retiree

2009-11-25T20:15:07-08:00

I'm going to make a confession. I live in a home that is 4,000 square feet. There. I said it. If you read a lot of blogs of other retirees or want-to-be-retirees, you may find this shocking. Now you know my secrets, I sometimes watch the Fox News Network, and I live in a big house.

I just finished reading this great post over at Early Retirement Extreme. Don't buy into society's value system, and you are much more likely to achieve the dream of early retirement. It's true.

But all is not lost if you bought in a little.

If we still lived in our first home, a 1,500 square foot Victorian in San Francisco, I would not only be living in the city that I love, I would probably have been able to retire about five years earlier. But I wouldn't have been able to grow tomatoes and make pizza in my back yard, and my husband would be complaining to me every day about city noise.

I was talking to a new acquaintance a couple nights ago and he asked me how it was that I was able to retire at such a young age. I know he was looking for a simple answer, I won the lotto, a rich relative had died, I had a trust fund, something like that. But since the real answer would not fit into a sound bite, I told him a little bit of luck and a lot of obsessing.

The real answer is, it's all about choices. If you want to retire at 35, you have to make choices that will enable that to happen. If you decide to live in a home with 4,000 square feet, you may need to retire a bit later. If you choose not to have children, you can buy a bigger home in a not-so-great school district, maybe even invest in a second home, and still retire young.

One of our cars has over 150,000 miles, the other, over 100,000 miles, and smells like mildew. If you choose to drive new BMW's each year, you may have to retire a little later. I get my hair cut at Supercuts these days, trim it myself between cuts, and do the color myself. I clean my own house, maintain my own garden, and paint my own walls. If having your hair done at a fancy salon, or having a housekeeper and gardener are things you can't live without, that too will effect your retirement date.

If you like to take luxury vacations and wouldn't dream of swapping your home, that will have an impact on your retirement date. If a big diamond engagement ring is something you cannot live without, that will have an impact on your retirement date. And if shopping at Old Navy is not your thing, and only Nordstrom will do, well yes, that too will impact your retirement date.

Indeed I did have a job that paid me the kind of money to enjoy a balance of some extravagances and an early retirement. I could have opted for more extravagances and no early retirement, or fewer extravagances and an even earlier retirement. It's the the same deal for most people, no matter what their job is. It's all about choices.

And yes, I still do choose to occasionally tune into Fox News. Please don't hold it against me.

Related Posts:

Travel and the Retirement Budget

Save for Later, Live for Now

Am I drinking My Retirement Savings Away?

The Stock Market: What A Difference a Year Makes

2009-11-20T16:00:57-08:00

You know that feeling when you put your hand in the pocket of a coat you haven't worn since last winter, and you pull out a 20-dollar bill? That's how I've been feeling lately. It doesn't make any sense, it was 20 dollars you already had, you just didn't know you'd misplaced it. You're really no richer than you were before you put that coat on, but you feel richer.

A little over a year ago, I was feeling poor. The nest egg that I had retired with had been decimated, and it was looking like all my masterful retirement calculations were not worth the computer paper they were printed on. Our retirement portfolio had fallen by 24% in the first eight months of my retirement. This meant that the stash we had retired with would no longer take us through the ripe old age of 95 as I had originally planned. Rather than take up an unhealthy lifestyle of smoking, drinking (more), and a skydiving hobby, we took the less thrilling approach of trimming the budget.

A person retiring in her 40's needs to save something in the neighborhood of 33 times her annual spending to get safely through her golden years. When our perfectly-sized nest egg shrunk to the not-so-perfect size of 28 times our budget, we joined the ranks of agile retirees. The shrinkage made us feel poor, and the reverse-wealth effect caused us to spend less. By the time that we finished our first year of retirement, we had cut spending so well, our shrunken nest egg was back on track to carry us through to our mid-90's again. And since, as it turns out, happiness is cheaper in retirement, we've spent even less in this second year of retirement than we did in the first.

We've watched in amazement as the stock market has made its steady march upward this year. We now have a nest egg of exactly what we had a year ago, except that instead of depressing me, that feels like a huge windfall. The spreadsheet now says we can live to 101, and I feel like I just found a twenty in my pocket.

Related Posts:

The Market: This Time is Different

Downsizing to Retirement

Downsizing to Recession

Will Retirement Give Your Marriage More Quality Time?

2009-11-18T13:11:17-08:00

I think the reason I miss my husband so much is because I see him so much now. Being retired means that we are both home all day together most days. Being home all day together most days gives us the impression that we are actually spending time together. Because we have the impression that we are actually spending time together, we tend not to plan anything special, just the two of us. The result is that most of our time together is spent apart in the same house, doing nothing special.

When I was working, the time that Doug and I spent together after a long day at work could hardly be described as quality time. I was tired and usually cranky, and much of our evening was spent eating dinner in front of the TV. But since we were very aware that we didn't get to see much of each other during the week, we often planned outings, dinner, a movie, a concert, just the two of us.

When I envisioned our retirement, I figured that since neither one of us was going off to work each day, the quality and the quantity of time that we spent together would increase. Well certainly the quantity has.

The thing is, now that we're home together most days, the special plans that we do make usually include other people. Our friends are off at work all day, so on the evenings and weekends, we make a concerted effort to include them in our plans, you know, since we've already spent all that time alone together. Except that we haven't.

We may be physically in the same place during all those hours we formerly used to be apart at our respective offices, but we're still attending to business, the business of running our lives: errands, housekeeping, gardening, and other mundane tasks. We may think we've seen each other all day, but really it is mostly in passing. And in the evening, we fall into that familiar pattern of eating dinner in front of the TV.

So what's really changed? I guess I'm in a better mood while we're eating dinner in front of the TV, but I wouldn't go so far as to say that makes TV watching actual quality time.

So here's the thing about quality time together in retirement. You have to make it happen.

When we were vacationing in New York this year, I wrote about how I love to get Doug out of town because when our days aren't filled with the mundane tasks of running our lives, we have a lot of fun together. That's probably why I wound up getting us the hell out of Dodge almost three months this year.

I guess the real trick though, is to make plans to have fun together, just the two of us, the other nine months of the year, even when we're not traveling.

Could wind up saving us a bunch of money on travel . . .

Related Posts:

Is this Marriage Surviving Retirement?

Will this Marriage Survive Retirement?

And With This, I Would Marry Him All Over Again

Is Being Content Preventing You From Being Happy In Retirement?

2009-10-23T13:50:39-07:00

Don't get me wrong. I'm all for contentment. It's right up there with enjoyment, pleasure, and delight. But don't underestimate the power of discomfort. Underrate it at the risk of your own happiness.

A few weeks ago, I wrote a post about how it was so easy to feel totally engaged and energized when I was on vacation in New York. I suggested that the big challenge in retirement was to capture that level of engagement when you're not on vacation, when you are just living your regular life. Having a wonderful life isn't enough. You've got to be aware that your life is wonderful.

Rosie contributed a great comment that suggested some techniques for feeling that engagement, such as practicing meditation and mindfulness. Her comment was spot on, because that is the whole challenge. Living in the moment. Being aware of it. And because in retirement, most of the moments are of your own choosing, being energized by just how awesome that really is.

Easier said than done. It's much easier to get used to it and take it all for granted. And that's where the discomfort comes in. I think to have a happy retirement, you've got to introduce some intentional discomfort.

It's easy when you are working, to look forward to those endless days of playing golf, watching TV, reading books, and lazing in the hammock. After working for years in a challenging career, this life looks pretty appealing. But when many retirees actually start living the dream of retirement, they often find they are bored, or miss work, or don't know what their purpose is anymore. They are no longer engaged.

When you're working and have exactly the right amount of discomfort, or what people usually call challenge, that makes for a generally satisfying work environment. Not enough challenge, you're bored, too much, you're stressed. Well, it's exactly the same in retirement. Why would we think it would be any different?

Just because we're not working anymore does not mean we've lost the desire to challenge our minds and our bodies. Just because we long for more free time to pursue our hobbies, does not mean we don't want to try any new ones. And just because we wanted to relax a little more, doesn't mean we wanted to relax all the time.

Discomfort is built into the workplace. Deadlines, complex assignments, and difficult bosses keep you on your toes. That kept you engaged. Now, in retirement, there is no boss telling you exactly which challenges to take on, it's all up to you. And with that freedom, you may gravitate towards easy, pleasurable, even mindless activities.

That may be exactly what you need initially as you detox from your career. But if you find yourself feeling less engaged in your new life at some point, it's time to find a hobby, a class, a volunteer activity, or a physical challenge that seems just a little bit too hard. You're the boss at your new job, the job of retirement. It might just be time for that boss to kick your ass a little bit.

What Do You Wish You Did Ten Years Ago (Ten Years from Now)?

Using Retirement to Get Really Good at Something

From the New York Times: How Nonsense Sharpens the Intellect

Retiring Early: Success or Failure?

2009-10-09T00:01:00-07:00

One of the fun things about blogging is seeing how readers actually come across my blog in the first place. Today as I was looking through a listing of which Google searches directed people to my site, I found a hit from Jackson, Mississippi, from the search phrase "retired early feel like failure."

Wow, that one really hit close to home.

I have confided just such a sentiment to some of my friends, the idea that if I were truly successful in my career, I shouldn't have wanted to retire. That I was obviously not a success since I basically dropped out decades before my peers. I had clearly been an impostor--thank goodness I got out in time before everyone else figured it out!

I always got the same reaction from friends: rolling eyes, shaking heads, protests, and scolding. "Of course you are a success, how many people do you know that managed to plan their retirements and then make it happen by the time they turned 44?" "You were the CFO of a well-regarded venture capital firm; those are smart people. You clearly wouldn't have made it that far if you didn't deserve it."

Logical arguments, I suppose, but I wasn't buying it. No one said what I really wanted to hear, "Oh my gosh, everyone feels that way!" Which just confirmed what I thought all along, I was indeed a fraud.

Imagine my delight tonight when I ran across Sylvia's post, Disguises and Impostor Syndrome. Impostor Syndrome. There's an actual name for it. It's a Syndrome. I have an actual Syndrome. According to Wikipedia, it's not a recognized psychological disorder, but still, it's a Syndrome. I'll bet it's almost a disorder.

Sylvia wrote her doctoral dissertation on the subject of high achieving women. Many of them shared their thoughts with her about this feeling, "which leads many of us to continuously question ourselves about whether or not we really have earned what we've achieved and whether or not we've been misleading others into believing we're smart and/or more competent than we really are."

"All of these women recognized that they'd been 'at least partially successful' but they also talked about that fear of being judged and having not accomplished what they should have. What was comforting to me then -- and now -- is that they also said that within that perhaps inevitable discomfort you have to focus on peace of mind. Wendy Cecil-Cockwell said it concisely: 'If you don't have peace of mind, if you're not comfortable with your decisions you're not successful. If you have peace of mind, you have everything.' "

Sylvia, you have done much for my peace of mind. I guess that means retiring early really is success.

Has Retiring in a Recession Changed Me?

2009-10-08T00:01:00-07:00

Yesterday, I posted about how the Great Recession has helped to keep my expenses low in my first year and a-half of retirement. So far, our retirement budget has experienced deflation instead of the inflation I expected.

Clearly this won't last. Eventually, inflation will come back, and some believe with a vengeance. Will I be able to keep my expenses in check? Will the lessons of this recession have a long-lasting effect on my future spending habits? Will I still be buying the money-doesn't-buy-happiness line when I actually have some?

Many out there think that Americans have permanently changed their spending habits. Conspicuous consumption is dead! Debt is totally uncool! Saving is the new black!

Yeah, I don't think so. As this piece in the New Yorker says, I think the reason "Americans have been spending less (is simply) because they have less money to spend."

When Americans have more money, either from finally landing a job, or for those with jobs, from the wealth effect of increasing stock and home values, will they spend more?

Some think that the biggest economic downturn since the Great Depression will have a lasting effect on consumers' psyches. I'm not so sure. Unless it lasts for another eight years like the Depression did, I think we Americans have a pretty short memory.

And even if the pain did last another eight years, Surowieki points out:

The notion that the Depression turned Americans into tightwads is largely a myth. In fact, it was after the Second World War that America really came into its own as a consumer society. In the five years after the war ended, purchases of household furnishings and appliances climbed two hundred and forty per cent, while between 1940 and 1960 the rate of homeownership rose by almost fifty per cent. If the Depression didn't make Americans wary of the pleasures of consumption, it's unlikely that this downturn will.

I like to think that retirement has made me a more evolved person, more appreciative of the simple (and free) things in life. But I'm guessing that if I had a lot more money, I'd probably be spending a lot more of it.

Related posts:

Downsizing to Recession

Downsizing to Retirement

Nostalgia About Being Poor

Retiring in a Recession: Really the Smartest Decision?

2009-10-07T12:37:30-07:00

Of all the issues a potential retiree considers, "Will I have enough money?" is the Big Kahuna. Add to that a nasty recession, and you have a lot of recent retirees, myself among them, asking, "What the hell have I done?"

I was concerned before I retired when the value of my retirement nest egg dropped by what now looks like a trivial descent. Concern turned to worry when it was down 4%, worry to panic when it was down 13%. By the time the market hit rock bottom in March of this year, I stopped calculating the percentage drop and wondered whether I should just do something already.

What did I do? Nothing. Much of those losses have since been recovered, and while we're nowhere near where I figured we would be when I contemplated retirement, it turns out one thing is helping. The recession.

Yes, our assets have shrunk. Significantly. But so have our expenses. Partly because it turns out I spend less money when I'm happy, partly because it's easier not to spend when your friends aren't spending, but mostly because so many things are costing a lot less because of the crappy economy.

By far the biggest line item in our budget is property taxes. Mine were just reduced by a whopping 34%. Yes, that means the value of my house is in the toilet, but the value of my home can't pay for food, money in the bank can.

Am I bummed that interest rates are so low my cash is barely earning a living? You betcha! But my mortgage rate just adjusted this month, and as a consequence of these pitiful rates, it's also down a stellar 34%.

Our health insurance premiums went way up, but not as much as our gasoline expense went down.

Part of managing a financially successful retirement is having an adequate reserve of liquid assets so you are not forced to sell the less liquid ones at fire-sale prices just to pay the bills. As this New York Times article points out, if you can manage to adjust your withdrawals in lean years, if you can be more financially agile, you'll still be right on track in the long-term.

I've just passed the halfway mark of my second year of retirement and am again pleasantly surprised by the financial results. Certainly not by the value of my assets. But the fact that the other scary, often overlooked element of the retirement plan, inflation, turned out to be negative for us, means we're still right on track. Since our expenses deflated 10% the first year and are on track to deflate another 7% over this year and next, neither one of us needs an untimely death to make the retirement plan work.

And that's certainly a relief to my husband.

Zombie Retirement

2009-09-24T16:29:57-07:00

You know how at the end of a vacation, especially one you are really enjoying, you start to dread going home? I used to count the days I still had left and then when it was down to one or two, I would start to get depressed about the vacation being almost over. I would try to enjoy what I had left, but there was always that growing feeling in the pit of my stomach, the dread of returning to reality.

I always thought this was because I had to go back to work.

So then why did the same thing hapen to me this time, at the end of my month in Manhattan? And why am I still having trouble getting out of this post-vacation funk nearly two weeks after being home? I don't work anymore, so why would I mind being back to the daily grind when the daily grind doesn't include any hard labor?

You'll often see advice to retirees to get into a daily routine, to add some sort of structure to your life. The thing I hate about people giving me advice is that it's usually wrong, and here's a perfect example.

I hate routine. I hate structure. That's probably the reason I was so anxious to retire. I was sick of the routine: wake up early, get ready for work, go to work, go to the gym, go home and eat dinner, watch TV, go to bed, and then wake up and do it all over again. Add to that a job I held for 18 years and that's being stuck not just in a routine, but a boring one.

I couldn't wait to retire so I could decide each morning what I felt in the mood to do that day, and then do it. Whatever it was, wherever it took me, each week would look different than the week before it.

Except it doesn't.

Monday is lunch with one friend, Tuesday is walking with another, Wednesday is writing class, Thursday is hiking with Doug, and then yoga, homework, housework, yard work, and social engagements are squeezed in over the remaining hours.

It's not that I don't enjoy these activities, these are exactly the things I like to do. It's the structure of having an actual schedule that has me feeling like a zombie again. I wind up going through my week on autopilot, much like I did when I was working. Without being totally engaged in it.

On vacation, decisions like what to see or where to eat, or the constant attention it takes to figure out how to get from point A to point B, where to transfer, even which direction you're facing upon leaving the subway station, keep you totally engaged in the moment. It's impossible to just drift through your day in a trance in New York City--if you stop paying attention even for five minutes, you'll find yourself on an express train to Harlem when you meant to get off at 86th Street.

All those years I spent fantasizing about retirement, I always thought I was attracted to the promise of an easier existence. I see now that what I really wanted was a more complex one. I wanted to escape the sameness of each day, the monotony of the structured workweek.

So for me, the retirement challenge isn't to find a structure to my life without a job, it's to find ways to break out of the routine that has replaced it, so that I can be more engaged, less zombie-like. Because what's the point of having the life you always wanted if you're not even paying attention?

New York Stories: Inside the Public Restroom

2009-09-13T15:35:04-07:00

After a trip to France several years ago, a friend asked me how it compared to our Italy trip the year before. "Much like Italy, only with better bathrooms," I told her.

When we were visiting Florence, we often found ourselves at the Piazza della Signoria on our way to get somewhere else. Not knowing where we might find our next bathroom, and knowing where the bathrooms were at Palazzo Vecchio, we usually popped in for good measure before continuing on our adventures.

The first time at this particular bathroom, I stood in a long line with several other women. We inched our way, one by one, toward the single-stall bathroom. When it was turn for the woman in front of me to go in, I got a peek into that stall.

I saw a hole in the floor, with slanted ceramic foot pads on either side of the hole before the door clicked shut in front of me. The question on my mind must have been visible on my face, because the British woman behind me said, "Last time I was in this line, an American woman turned to me when she saw the loo and said 'Oh my! Now is it ass to the door or ass to the window?' "

I was thinking along the same lines, is it toes tilted up or toes tilted down, but unfortunately, she did not bestow the answer upon me.

This month exploring New York City also involved many a public restroom, although with much more conventional plumbing.

But as with that Italian trip, I was often faced with a similar bathroom mystery. Are some users of public ladies' rooms thinking it's ass to the door?

I cannot tell you the number of times I walked into a bathroom stall this month, looked at the toilet seat, and thought, "how on earth did you get that there?" It became kind of a brain teaser--how must that woman have contorted her body to get that there, and wouldn't it have been kind of dangerous?

On our last night in Manhattan, over cocktails with friends, I began my rant about the state of New York City's bathroom stalls and said that I intended to blog about such state. They told me to be sure to include the quote from an unknown, wise most-likely woman: "If you sprinkle when you tinkle, be a sweetie and wipe the seatie."

'Nuff said.

This is New York

2009-09-12T12:35:07-07:00

"A poem compresses much in a small space and adds music, thus heightening its meaning. The city is like poetry; it compresses all life, all races and breeds, into a small island and adds music and the accompaniment of internal engines. The island of Manhattan is without any doubt the greatest human concentration on earth, the poem whose magic is comprehensible to millions of permanent residents but whose full meaning will always remain elusive."

-E.B. White, This Is New York

I haven't written much about my love affair with New York these last couple of weeks, in part because of spotty internet service, but mostly because I've wanted to keep it all to myself. Mine all mine.

New York has made me feel a little selfish about my relationship with it, although ironically, it has been generously giving me more than I'd dreamed of. As White puts it in his compact ode to New York, "On any person who desires such queer prizes, New York will bestow the gift of loneliness and the gift of privacy . . ."

"New York blends the gift of privacy with the excitement of participation; and better than most dense communities it succeeds in insulating the individual (if he wants it, and almost everybody wants or needs it) against all enormous and violent and wonderful events that are taking place every minute."

We are on the third and final swap in our series of home-exchanges here in Manhattan. Each of our temporary abodes has had its charms and challenges, but this last one has completely intensified my love affair with New York. It's a beautiful pre-war, doorman building. In it, I feel like I'm living a page of New York history.

I can picture the couples, or probably singles, that have graced this elegant studio over its many decades, with its rich, dark hardwood floors, crystal chandeliers, and iron French-paned windows overloking the southern skyline of this exciting island. I contemplate their lives here, and admire the elegance of their dress as I glimpse at sepia-toned photos of those past eras. I feel connected to their world here, here in this apartment.

This month has just made me long for more. I can't get enough of this beautiful, loud, smelly, stately, elegant, crowded, exciting city, that awakens all my senses and makes me feel more alive than I ever do back at home. But I'm grateful to have been able to call it home for this month and can't wait for next time.