The Rest of the Retirement Story

Another sobering about retirement, or lack thereof: Households that expected to find retirement just around the

corner will have to work longer. The main reason? Debt, debt, and more debt: mortgages, home equity loans, kids’ college expenses and credit card debts are saddling 60- to 64-year-old households who expected their retirement-age years to be stress-free. This is not the first article I have ever come across about baby boomer debt. Since 2008, many studies have surfaced about the plight of older adults and how they have fared during this recession and housing meltdown. It is heartbreaking to read about decades’

worth of retirement planning going awry.

Ah, but perhaps I misstated the problem: Is this really decades’ worth of retirement planning that has all of the sudden crumbled due to a few recessionary years and an upside down housing market? I would venture to say that is not the case: the operative word here is “decades.” I wonder how many households who are delaying their retirement and having to work into their 70s actually started planning for retirement back in their 20s. The likely scenario of lack of preparedness probably goes something like this:

  • Age 20: “I am in college and can’t even think about retirement right now. There is plenty of time for saving.”
  • Age 30: “I am established in my career but I just put all of my money on a down payment for this McMansion This should double in price in 10 years and count toward my retirement investments!”
  • Age 40: “How am I supposed to save for retirement with a mortgage and two car payments and kids’ sports and school activities? Wait until the kids are grown and out of the house and then I can save more.”
  • Age 50: “One kid is in college but needs help with expenses. The other is living at home and trying “find himself;” he needs help with his cell phone bill and car insurance I can’t just cut him loose yet. Plus I still have 10 years left on the mortgage.“
  • Age 60: “Wow, the house did not appreciate like I thought it would. I thought I was supposed to be able to retire on my home equity. I don’t have near enough in my 401(k). What happened?”

This is not to say that every household that cannot fulfill their retirement dream has not planned ahead. But to be blunt, these reasons for not saving are all too common: high expectations for housing prices, high expectations for living standards, and high expectations for children to go on to college on their parents’ dime. (Yes, many parents in their 50s and 60s are paying off their kids’ student loans.) The “culture of consumption” has finally caught up with a generation that wanted to have it better than their parents did, and want to give their kids more than they will ever have. Perhaps that is not such a good thing if it means working until you drop dead.

Comments (12)

Trackback URL | Comments RSS Feed

  1. Joe Barnett says:

    Hope they got a viatical settlement (cash for insurance) before dropping dead.

  2. simon says:

    Procrastination rarely works…”there is always tomorrow to start saving for retirement”

  3. pat harrington says:

    Pam – you are spot on. I could not agree more.

  4. pat harrington says:

    Pam – you are spot on. I could not agree with you more. My husband and I have saved and he is retired and i will in 3 more years. We started saving early but we should have started in our 20′s rather than in our 30′s. It is true in life things just happen and you find yourself helping out your children especially when there are grandchildren involved. We are doing just what our financial planner advises us to do and it looks like we will make it. We do not live a lavish life style but are happy to have our bills paid and our home paid off.

  5. Al Kreps says:

    The spend everything buying toys and non-essentials and the throw away generations has now caught up with them. The idea bubble that values will increase, inflation will get us the margins to keep going has burst. It does not appear that the old times of growth in values will come back for many years to come if ever. And, now it seems as if those of us who did prepare for our retirement age will be penalized for doing so by an administration that is socialist. Thus, those who did nothing to prepare for retirement are being rewarded for their lack of planning.

  6. Amy Hopper says:

    Yes, we wanted more than the 4 room house our parents had paid for and more than one car and bathroom we did not have growing up, and we thought getting a college education would give us the best opportunity to make a better life than what our parents had. My father was dead at 69 but his father lived until 88. At 70, we do have a reasonable IRA from a private practice, but our house is not paid for, and we have a condo in Florida we cannot get back what we paid although it is a great place. My husband continues to work 4 to 5 days a week, and I(who worked for him for 30 years) try to make the money last. We had a lot of fun, but now we wonder what the future holds. We do have to pay the Piper!

  7. BRAD DUNN says:

    High expectations for housing prices, High expectations for living standards, and high expectations for children to go on to college on their parents’ dime that’s why I am looking for retirement plan heard from my buddies that bankers life insurance & casualty is good.. http://www.bankerslifeinsurance.com/ have good ones. Any other opinions?

  8. Christie says:

    Yet he chose to ask me so many questions about how and why I do things, because he could see the profound insight I had built up due
    to going my own way with my own research and testing over the past 7 years.
    At times, your sailing instructor may need to issue an order and have it followed immediately.
    Here are the guild quests along with a handy location and a listing of the reward
    for completion.

    My page; marine refrigerator tv repairs miami

  9. Helene says:

    While you are in the diet phase where you are taking
    your sublingual h – CG, you will need to be much
    disciplined in order to get the results you want. This is not
    the energy expenditure with planned exercise.
    “Never feeling hungry is not a sign of being healthy,”
    stated Dr.

    Feel free to surf to my webpage; hcg drops for weight loss yahoo

  10. Valentin says:

    Website Content – It is not discouraged that you use website contents and articles coming
    from other websites because content syndication is still common online.

    Tip One: Choose a Target Phrase – There should be one target phrase used within your web pages.
    It is never possible for the business owners to find out the changing algorithm of the major
    search engines and have their websites optimized to
    secure high page ranking in the major search engine.

    My page … Two Cans Media SEO

  11. Kira says:

    Kim Kardashian certainly isn’t the first celebrity to get
    some work done, but the ‘Keeping Up with the Kardashians’
    episode did prompt a plastic surgeon, Dr. Sometimes, our decisions could be clouded by pressure from our surroundings.

    By changing the size & shape of the nose, this cosmetic nose can positively influence the balance of facial features.

    My blog post top news

  12. Pamala says:

    Your syndicate agreement does not have to be a complex document.
    Connect “A’s” positive terminal to “B’s” negative terminal.
    You can then take your armored vehicle and cash it in at
    a chop shop, creating a nice little criminal spree combo.

    Feel free to visit my site: dock ram box accessories

Leave a Reply



If you want a picture to show with your comment, go get a Gravatar.