Category Archives: 50+ Money

No Fear Retirement

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Although I believe that we are all still Too Young to Retire® I also know that there are many fears about the transitions from full time careers into new and uncertain phases of our lives. One of our 2Young2Retire® certified facilitators, Pamela Houghton, has published a new book, No Fear Retirement, written for anyone who is thinking about, or has already embarked upon, retirement.

No Fear Retirement addresses ten of the most common concerns of those who are thinking about retirement. Whether your fears are around finances, your relationships, where you will live, your identity, or something else, this book is a valuable resource. Taking time to reflect on the Pause for Thought questions along the twelve phases of retirement or associated with the ten most common fears, will make this read well worthwhile and may help you enjoy a more fun-filled and fulfilling life if or when you retire. For more information visit Pamela Houghton’s website: http://www.retirementsunlimited.co.uk/

Paul G. Ward
President

Launching a Business

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Thanks to a link provided by schoolteacher who has been using material from 2young2retire.com in her charter school classroom, we decided to update our page for entrepreneurs.  Here it is:

You may always have dreamed of being your own boss, or you may find yourself driven by an economic climate that opens new doors even while it closes others.   Whatever the motivation, welcome to the club.  You are in excellent company.  While young entrepreneurs tend to be the darlings of the media, the 55 and older cohort of entrepreneurs is growing faster and doing better. Why? Could be life/work experience, some cash from a downsizing, mortgage paid off, kids launched, and an idea that has been incubating for a while. Too Young to Retire: 101 Ways to Start the Rest of Your Life (Plume 2004) is packed with business ideas, from antique restorer to wedding planner. If your big idea isn’t listed here, feel free to drop me a line and tell me about it: marika@2young2retire.com.

Obviously launching a business at any age is a huge undertaking and we can only scratch the surface of the subject here. The good news is, there is plenty of information available to anyone with access to a computer and Internet connection. Beside some fire in the belly and cash, what we all need as entrepreneurs is help from experienced business people who can mentor us through the startup process and direct us to the people and resources that help us grow.

Small Business Resources

As of this writing, Service Corps of Retired Executives (SCORE) is about to launch a newly designed website that will make it even easier to connect with experienced mentors — 13,00 of them — on line and in a new series of workshops on starting, managing and growing your business. A click will take you to an archive of business columnists SCORE has been around since 1964 offering free and confidential business advice that has helped millions of aspiring entrepreneurs.

Wall Street Journal Small Business is another excellent source of ideas and expert opinion.  The Small Business Guide covers everything from starting a business to selling it.

Another source of good general information for free is the Small Business Administration.   See also the Virtual Business Plan from Bizplanit.

Business Insurance is a handy guide to some basics including legal, marketing and personnel resources with live links to speed you there.

The independent entrepreneurs check out Working Solo (www.workingsolo.com), the terrific site started by Terri Lonier (lone-yay) on the joys of being “boss-free.”  Ilise Benun’s Marketing Mentor is also dedicated to the soloist or small partnership. Get a free consultation, daily newsletter and preview of her books.

You can find lots of help by seeking out trade associations connected with the business you’re considering.  Trade associations can fast-track you right into the action, helping you connect with the people in the know, and perhaps even some financing sources.  When Paul and Sands Belizzi wanted to ranch alpacas in Northern California, they got started in just this way: Alpaca Owners and Breeders Association (U.S.), 800-213-9522.

As the name suggests, the National Business Incubation Association “provides entrepreneurs with the expertise, networks and tools they need to make their ventures successful.”

The U.K. has a model for what is possible when you have a champion.  In this case, the champion is Charles, Prince of Wales, and his organization is Prime-Cymru (Welsh for Wales), www.prime-cymru.co.uk, dedicated to help would-be entrepreneurs 50 and older get a start.  Of the 600 start-ups Prime-Cymru has helped launch, only 6 have failed.

Inn Keeping

Thinking about owning/operating a B&B (who hasn’t)? You might want to contact theProfessional Association of Innkeepers International for some on the ground information.  Try out innkeeping for a season or a year.  Or check out house sitting via THE CARETAKER GAZETTE, (715-426-5500) published by Gary and Thea Dunn.

Owning/Operating A Family Business

If you do go into business for yourself, chances are you’ll find yourself (at least in early stages) working with your spouse or another family member.  A caveat: these partnerships are easier to get into than to get out of, so make sure you know how to end gracefully (and save the relationship itself).

The Center for Family Business has courses and more information on this topic.  203-932-7421.  Another resource: The Family Firm Institute, Inc.

And, don’t overlook your local Chamber of Commerce.  Knowing who’s who in business in your community can be a great way to test the waters.

Books/Magazines

There are literally hundreds of books on becoming a successful entrepreneur.  One of our favorites remains Paul Hawken’s Growing a Business (Fireside, 1998).  The co-founder of Smith and Hawken, he now leads The Natural Step, an organization committed to sustainable business practices.

Inc. Magazine remains a reliable source of information for the entrepreneur, whether you are just starting out or growing your business. We loved the recent coverage on balancing business with life featuring Pete and Laura Wakeman of Great Harvest Bakery. Search the Inc. site for this.

Also useful is Entrepreneur magazine, which also features a wealth of small business how to’s.

Jeff Berner’s The Joy of Working From Home: Making a Life While Making a Living (Berrett- Koehler Publishers, Inc. 1994) is a classic of its kind, packed with great ideas for you entrepreneurs and independent contractors.

Aging Without Mr. Right

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Nearly one in six elderly unmarried women age 60 and over (17 percent) was poor in 2008, and 16 percent of those 75 and older were poor. (Unmarried Women Hit Hard by Poverty, Center for American Progress)

I was on the phone not long ago with a friend, I’ll call her Arlene, who has been absent from my life for some time.  Because she works two jobs (it was 2.5 for awhile), we had been playing phone tag for the last few days and that may also be why we’ve been out of touch.  We caught up with each other because I was housebound, beginning the infamous ‘prep’ for a colonoscopy.  I might have to end the conversation abruptly, I told her, but would call her back.  We shared a laugh over that.  She is a few years younger than I am and is yet to have this routine procedure.  In fact, she had not seen a doctor or had any kind of screening for a long time. “I haven’t had health insurance for ten years. I couldn’t afford it.”

What’s wrong with this picture?  A lot, both on the micro and macro levels.  My friend is well-educated and has worked in the entertainment industry for her entire career, holding glamorous jobs — or so they seemed to me — at some of the best companies on both coasts.  We were both in our 50s when we met, and she thought the future would continue in a direction commensurate with her education, talent, experience, and good looks.  She fully expected to continue to live in a home she owned, in an urban area with all the arts and culture she was used to. She was my idea of an independent woman: not looking for a man to complete her, but not against the possibility that Mr. Right could turn up.

So far this hasn’t happened, and she appears to have grown comfortable with aging as a single woman.  And according to an AARP study, many older women would agree, see: The Secret Lives of Single Women. What isn’t such a rosy picture is what aging as a single woman might mean to her financial future, especially if she becomes ill or disabled.  Mothers of single daughters (I am one), listen up!

Arlene’s is a familiar enough story: as her industry began to contract, she lost better jobs to younger people.  This is systemic, apparently, and not just at the level of female superstar who disappear from the screen at a certain age (Meryl Streep the obvious exception). Over the last few years, Arlene has mostly worked freelance and so health insurance has been beyond her means.  “Who would have ever thought I would be looking forward to Social Security and Medicare?!” she asks.  Until she reaches the age of eligibility for these benefits (and possibly even when she does), she will likely remain one of the working poor: healthy (fortunately) enough to work, able to pay her bills (just), saving nothing, and earning too much to qualify for Medicaid.  It’s a tough situation for anyone, but worst if you’re a woman and earn less to begin with.

Sexism combined with ageism might have done my friend in, except for her remarkable resilience, sense of humor, and the support of  female friends of which she has in abundance.  Friends for company, advice, conversation, comfort and sometimes financial help.  Arlene doesn’t expect a fix from inside the Beltway.  She’ll keep working; she’ll eat right, exercise, keep herself healthy; she might relocate where housing and living costs are lower.  She’s nobody’s fool.  Those of us who are happily partnered need to look out for our single sisters of a certain age as well as our unmarried daughters of an independent mindset.  And I’m not talking about finding them a date for Saturday night.

Resources:

Unmarried Women Hit Hard by Poverty

Wiser (Women’s Institute for a Secure Retirement)

Women Work!

It’s the Money, Honey!

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Some folks called it retirement savings. We prefer financial independence. What’s in a name? Well, which of those two terms give you a feeling of freedom, uplift and excitement about the rest of your life? Lots of ways to get that happy state, including voluntary belt-tightening when it doesn’t seem necessary, the millionaires’ secret to having and keeping wealth. Here are two mind-altering perspectives: Your Money or Your Life by Joe Dominquez and Vicki Robins and Die Broke: A Radical Four-Part Financial Plan by Stephen Pollan and Mark Levine.

Getting your financial house in order is also knowing where your money is coming from, and the chances are some of it will come from Social Security which you’ve been funding with your payroll taxes. Here’s a handy new calculator courtesy of your government, that will give you a base line of what you can expect, and a heads up if you are even contemplating quitting early. OK, Social Security may not cover all your anticipated expenses — although we know of an avid biker in Texas who manages to save enough from his Social Security payments to travel to Italy every year — but a monthly income you can count on, however modest it may seem, is a nice little cushion and a good place to start.

If some of the scary coverage about Social Security makes you wonder whether it will be there for you when you need it, read this earlier post.

Good News Hunger

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How often does a good news rise to the top of the list? Well, today it did in New York Times op-ed columnist Nicholas Kristof’s wonderful piece on Beatrice Biira, for whom the gift of a goat through Heifer International was the transforming event of her life. The fact that the column was #1 on the most emailed list was an indication of how much we hunger for good news in a time when it is in short supply. This is not only that rare occurrence, but a reminder of how relatively easy it is to make a huge difference in the life of someone who is heading into the oblivion of “one more illiterate African woman, another of the continent’s squandered human resources.”

At 2young2retire, we are often asked for ideas about community service by members of our 50 and older audience. The both good and bad news is: there are more social problems crying out for our help than there are people looking for them. Mature volunteers are in great demand for their life experience and dedication. Just look around your own community, look at the schools, see where and how the other half lives. And if you need a place to sift through the available volunteer opportunities, here are two. Idealist and Volunteer Match.

In the meantime, when you next need a gift for someone who has everything — and that is an awful lot of us in this country — consult the Heifer catalog. As little as $20 can send chicks to a family in Africa or Asia. You get a beautiful card to send to your friend or family member, along with your own message to appreciate the abundance in which many of us live by a happy accident of birth. Make you own good news; satisfy that hunger for uplift.

Much Ado About Retirement Savings

As if economic news wasn’t depressing enough, this week Hewitt Associates, “a global human resources consulting and outsourcing company,” got some press with a report that is sure to fuel money worries in all but the most financially secure Boomers-and-beyond. Quote: When factoring in inflation and increases in medical costs, Hewitt predicts that employees will need to replace, on average, 126 percent of their final pay at retirement—significantly more than the traditional targets of 70 to 90 percent pay replacement. Yikes!

But all is not lost, the report goes on to say. Small changes in behavior, e.g. increasing one’s savings, smarter investing, lower fees, and delaying retirement, can “enable more people to achieve a more comfortable standard of living once they retire.” The Motley Fool does the math differently, factoring out the ‘costs that evaporate once you leave the workforce’ — Retire Well for Less That You Think — to show that you need to replace much less income than is commonly supposed.

Both miss these points: 1. You can choose to reduce your standard living in any one of a number of ways, of which clipping coupons is the least creative and downsizing your living space perhaps the most disruptive, and 2. Opting to retire in the traditional sense will almost guarantee that you’ll be increasing your medical costs, so the choice to keep working in some capacity (pro bono, if you can and wish), actually positively impacts your bottom line.

For other fresh thinking and great tips you won’t find anywhere else, get yourself a copy of the new edition of Retire on Less Than You Think by Fred Brock, former Seniority columnist of The New York Times. Accessible as a Dummies book, it includes right-on personal anecdotes like how Brock cashed in a house in Montclair, NJ for a much less expensive one in Manhattan (Kansas, that is), and not only reduced his expenses but pocketed the difference.  By the way, he also ‘retired’ from Times job to become a journalism professor.  Read this review.

Social Security: A Surmountable Challenge

You’ve heard of artificial deadlines? Hmmm…retirement at 65 (or whenever) comes to mind. Well, how about an artificial milestone created for sensational headlines, contrived to bring attention to a non-existent crisis? Case in point: this week, retired school teacher, Kathleen Casey-Kirschling, became the first boomer to apply for Social Security benefits. It was a field day for the school of chicken little reporting as phrases like looming bankruptcy, financial implosion, fiscal meltdown, Boomsday is Nigh (SF Chronicle), and even the suggestion that Ms. Kirschling was Public Enemy No. 1, made their way into print and broadcast. The Times (London) weighed in with its own: From boom to bust: the silver generation that could leave Uncle Sam broke. Social Security Commissioner Michael Astrue, who orchestrated the media event, set the tone with his term for the ‘crisis’: America’s Silver Tsunami.

Kudos to the Kansas City Star for its focus on the fix, of which there are quite a few, not to mention that we have 34 years (that’s four 8-year presidential terms) to implement them. Everyone is in agreement that we have a problem, although it pales in comparison to Medicare funding and rising health care costs. The version we prefer comes from the Social Security Board of Trustees Report itself: “The financial difficulties facing Social Security and Medicare pose enormous, but not insurmountable, challenges.”

Fixes that have both supporters and detractors include:

  • Raising the cap for FICA, now set at $97,500.
  • Raising taxes from the current 7.5% (both FiCA and Medicare)
  • Increasing the age of eligibility for full benefits (it is already at 67 for some)
  • Encouraging savings (now that’s a novel one!)
  • and so on…

Oddly enough, the possibility that the majority of boomers will remain in the workforce, as they have been declaring in surveys over the last several years, doesn’t enter into the crisis equation. If they do — and we think health insurance concerns will contribute to the decision to keep working — the projection of a smaller worker to retiree ratio, from 3 to 1 currently to 2 to 1 (less income, more pay outs), is just plain wrong. As of now, if you are 65 or older, you can be collecting Social Security benefits and earning an income (on which you pay FICA taxes, of course). It seems to us that we need to factor in productivity gains and the impact of immigration on the workforce. If there is anything to fear, it is that the high cost of medical care will gut Medicare. But Social Security is, in our opinion, a surmountable challenge. What’s needed is imagination and political will on the part of the elected and the electorate…now rather than later.

“An optimist sees an opportunity in every calamity; a pessimist sees a calamity in every opportunity.” — Winston Churchill

More reading:

Social Security needs fixing — and fast. Kansas City Star
Social Security: Scare tactics or true crisis? Lita Epstein, author, Complete Idiot’s Guide to Social Security
Generation Ageless J. Walter Smith
Is Social Security in Trouble? Depends on Whom You Ask Knowledge@Wharton
Center on Budget and Policy Priorities


Leap! She Says

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“If you wish to persuade me, you might think my thoughts, feel my feelings, and speak my words.” — Attributed to Cicero

To a degree, good books do this, which is why they generate an instant buzz and word of mouth, why they tend to be remembered, the way people tend to remember Sara Davidson’s Loose Change, her landmark book of coming of age in the 70s.

Davidson’s new book, Leap! What Will We Do with the Rest of Our Lives?, will also find an audience and have legs, we predict. The excerpt, published earlier in Newsweek, gives you an indication why we think so. She writes not as a keen observer and journalist, although she is both, but from inside 50+ angst, “the narrows, the rough passage to the next part of life.” Work dries up. Suddenly, despite awards and recognition for her hit shows, she “can’t get arrested.” Her nest empties and her lover leaves.

The narrows will no doubt ring a bell for many within the baby boom generation and for those of us who came before, although we may not have been quite so open about our vulnerabilities. Davidson’s candor is bracing. We, who have made a project of telling the good news about aging, admit that a lot of it is confusing, difficult and painful, and we don’t have very good guides about how to do it well.

Leap! What Will We Do with the Rest of Our Lives? will help. Although its focus is on the more aware, accomplished, successful segment of the boomer cohort who have the luxury of choice about their ‘next life,’ there are plenty of ah ha! moments for anyone willing to take some risks about the future. And a lot that will touch you and make you smile and nod in recognition. Davidson’s interviews with Carly Simon on her comeback; self-help guru, Joan Boryshenko on her fourth marriage; with Tom Hayden, about ‘putting [one’s] career drives down,’ and his former wife, Jane Fonda; with Bernard Lietaer (creator of the Euro); and with Jac Holzman, founder of Elektra Records, stand out for this reader. Holzman’s advice mirrors the 2young2retire credo:

“You don’t have to figure it all out. Pick something and do it. Take a look at what’s out there and see what you’d like to stand next to. Or if you don’t see anything . . . Wait till lightning strikes…Because it always does.” Amen.

Have What It Takes to Launch a Business?

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This is an interesting question and one probably not asked often enough by would-be entrepreneurs, which explains why so many businesses never make it to Year Five. Even the most well thought out new venture carries a certain amount of risk, which is part of the attraction. It’s one thing to risk money, time, and energy when we’re in our 30s or 40s, and quite another when we are 50 or older, for obvious reasons. So even if you have a great idea and the money to invest in it (or know how to raise it), it makes sense to put yourself through at least one assessment of your potential as an entrepreneur. Here’s a pretty good one from Monster.com, twenty-one questions that will help you get clearer about communications skills, self-confidence, how you deal with uncertainty, financial issues, partners or employees, to mention a few essentials. Fun to take. If it turns out that you don’t have the right stuff, take heart. All it has cost you is a few moments of soul-searching.

We also recommend Michael E. Gerber’s The E Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It, especially Part II, The Turn-Key Revolution: A New View of Businesses. What we learned from this book is very simple: a successful business is one that can and must outgrow its founders. It can be franchised, scaled up, whatever buzz word fits. Two other gems: “Without a clear picture of the customer, no business can succeed.” “Ask yourself: Does the business I have in mind alleviate a frustration experienced by a large enough group of consumers to make it worth my while?” Read it before you take the plunge.

Best Places

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You’ve had it with shoveling snow, long commutes to work, paying too much in real estate taxes. The grandkids moved to another state. Your elderly parents need your help across the country. One or more of these can trigger questions about relocation as we cross the threshold into the second half of life. As we age, we become a nation in search of the ‘best place’ to live. Suppose you find, as we do, the usual list of location must have’s inadequate. You know, the lists that assume you’ve hung up your spurs as regards making a living: affordable housing; plentiful leisure activities; cultural options; sunny weather; good health care access.

All good, but suppose you want or need an income. Suppose you want to live near your grandchildren or elderly parents in an environment that is business-friendly. While it is true that technology has enabled many of us to work remotely, what if your dream is to become a minister, or open a dog grooming business or launch a practice as a professional organizer, to name three on our Top Ten? Through this lens, we took a look at information that is available for the asking on the web and here are our best picks. Who knows? When you start researching your personal best place, you may find that your own hometown has more going for it than you realized.