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I voted that I was worried and reducing spending -- we will be living on SS and our own investments plus IRA's as we have no pension. Plus the first 3 years of my husband's retirement (I am partially retired) we spent more money than any other years previously. Of course our two children were both married in those years and they were long distance weddings as well as more expensive and frequent vacations. We shall see what the future holds but I am being cautious.
The distribution curve has not changed much with 55 responders with the majority in the middle skewing a bit towards the positive.
It's interesting to note that 9% chose "varied with retirement phases and life circumstances". This shows that in spite of our best plans, life is still unpredictable.
I was surprised to find that I was more relaxed about our finance situation this year when we started receiving some real fixed income (my husband's SS and my small monthly pension). This fixed retirement income is only <20% of our working income. The fact that it is a guaranteed income makes a huge difference in its 'emotional' value.
My job was relatively secured while I was working. I was much less susceptible to layoffs than some other workers based on my education, expertise and performance ratings. However, in the tech industry, nobody could truly feel safe. At any given moment, the jobs could be shipped overseas, the businesses could be significantly contracted or disappeared through divestitures, selloffs or closures. I was very lucky to be able to stop working on my own choice. My husband was laid off twice. This was why our monthly paychecks always seemed very transient. We had no choice but trying to save to the max.
I suspect that many people who checked box 1 and 2 have good fixed income sources and/or a nice retirement saving. If I could have had a choice, I would have taken a nice pension over a nice 401K balance. I had a number of very good job offers after completing my graduate studies. Our criteria to choose an offer was first based on pension offer, then the company layoffs history, and whether we both could get good jobs in the same area.
The Fortune 500 company which we chose to work for had their very first and major layoff shortly after hiring us. Few years later, the defined-benefit pension plan was replaced first partially then fully by a defined contribution plan. The generous retirees health insurance benefit also went away and replaced by a much more limited Future Health Account.
Our pension payments were relatively modest ($400/month for my husband from a company he worked for 5 years and a bit over $1K annuity payment for me after almost 24 years with the last company). We got nothing from few previous jobs which we worked for less than 10 years back in the 70s and 80s. However, I think that we are still quite lucky in comparison with many people. My husband was able to delay his SS payment until 70 to get the max benefit because I was working until he was 68. My VSI (voluntary separation incentive) has also helped us not having to dip into our saving until his SS payment.
I certainly understand the anxiety in the retirement community with rumors/news about potential SS cuts and big Medicare premium hikes. We would like to think that only future retirees will be affected by the cuts. However, the sudden changes in SS payment rules last year shows that nothing in life is certain.
I have to wonder whether there would be more people who will belong to category 6 with their retirement financial status affected by not only negative changes in personal life and public policies.
BellaDL, I had a problem trying to figure out my response. Not because of the income side of the equation but because of the expected/predicted possible long term cost. Think we are all over the place in our feelings about retirement income then compare that to where we probably are in regards to cost. The person who has $3 million saved could be just as uncertain as the person who has 5Ok saved. I saw a study one time and it found that about 5 million was the point where people began to cease being concerned to any degree. Do you think you need. Medical cost, nursing cost, life style cost all have different cost projections for all of us. Some would never consider going on Medicaid or housing assistance etc. Others are very willing etc etc. How comfortable we are right now is PERSONAL and based on OUR financial goals and comfort level that goal represents. I may be there now but I know what WE need and want WE more down the road and it is OUR right to define need and not someone else. Thus I arrived at the response I did!
I voted for "Keep same lifestyle" even though I would say that I am very concerned. Maybe I am just a worrier, but I see a lot of uncertainty in our future. I just don't know what to do about it so hence we keep the same lifestyle. But if the US were to have another decade like the 2000's in which our economy tanked for 10+ years, I would be hurting personally, and I think the effect on the US economy would mean it would affect SS and Medicare. We would also be hurting if one of us had a major medical catastrophe. We have some insurance protection but there are realistic scenarios in which that would run out. And who knows where healthcare and Medicare are going - costs are spiraling out of control and Medicare is a huge drain on the government. Something has to change. How will that affect us?
But, if everything simply continues as it is today, we will be fine. But things have a way of going their own direction rather than the direction I want it to go.
We were essentially living on my pension budget for about 4 years before I retired (federal pension indexed for inflation and medical coverage for both my spouse and I). We moved to a low cost of living area when we finally fully retired from work, and have been comfortable financially, but I can't just blow a couple thousand on a trip or just drop the cash for a significant purchase on a whim anymore - I have to plan and budget a bit. I can still do anything I want travel or purchasewise, I just have to do it less frequently, and on a planned budget timeline. So while my day to day lifestyle has not really changed (and maybe has improved a bit), and I have no financial worries, I do get frustrated that I can't just spend $3-$5 grand on fencing the property this month for example, but need to wait 3 months to accumulate the cash - it annoys me to have to budget it, but I truly only have first world problems, and realize the wife and I have been very blessed and lucky with relatively good health, and comfortable finances.
Why is it that when retirement comes up, it seems to be mostly about money?
Because money is easy to quantify, and thereby to arrive at success/failure criteria. From there, one can feel smug and superior, or guilty and pathetic.
Quote:
Originally Posted by BellaDL
A survey of financial planners showed running out of money is the top retirement concern...
But that’s not necessarily because people are indeed financially strapped; it could be mere psychology! Joe Parsimonious has $10M saved, but spends $20K/year because he’s terrified of hypothetical disaster – or merely insistent on maximally growing his portfolio. Jane Spendthrift has only $1M saved, but spends $40K/year, because she’s read the “Trinity” study and feels that the purpose of her portfolio is to support her lifestyle. OK, maybe I should call her Jane Realistic, instead of Spendthrift.
Quote:
Originally Posted by BellaDL
...For me, I think it is helpful to know 'where-a-person-is-coming-from'. ... The perceived status may not reflect the actual one but it is very real in one's mind.
Very true! As an impending retiree or semi-retiree, my #1 concern is finding meaningful occupation, where I’m contributing to society and to posterity (and tickling my personal vanity), rather than counting the years until death.
Quote:
Originally Posted by TuborgP
... The person who has $3 million saved could be just as uncertain as the person who has 5Ok saved. I saw a study one time and it found that about 5 million was the point where people began to cease being concerned to any degree. ...
By one reckoning, cessation of worry is possible only upon death. There are lots of stories of billionaires losing it all - to frivolous criminal prosecution, sudden collapse of their corporate empires, unscrupulous business-partners, or just the inscrutable wrath of the universe.
Even though we both have college degrees (me in healthcare, him in engineering), we have never had jobs with pensions so we are stuck with SS and our savings. Luckily in-laws encouraged us to start retirement savings early so we won't have severe problems unless the stock market crashes again. I took some time off for child and then when I lost my job at age 59 and couldn't find another one I was forced to take SS at 62. Had a few zeros in my 35 years with lower paying jobs so check is pretty crappy, especially for a college educated person. DH taking SS end of this year at FRA.
Anyway we have to watch things. I always hoped to travel but between the financial and the messed up hip replacement we aren't going to get to do what we wanted. Probably won't even get to do things with any grandchildren we might have. It's rather depressing. But I have concerns about future healthcare costs, so don't spend too much on fun things. We have to replace a car soon as well.
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