Playing Catch Up

Source: legaltemplates.net
Source: legaltemplates.net

Recently a former co-worker and I were discussing our respective retirement incomes. She ended one of her emails to me quoting the old adage about money not buying happiness. And she’s right, it certainly cannot. But her mentioning this familiar phrase did get me to think about how the choices we make in search of happiness often intersect with the practical realities of our daily lives.

For instance, take my wife.

Okay, well, first enjoy this quick Henny Youngman joke and then I’ll make my point. Sorry, but I think there’s a written rule somewhere that if you use that comedic term of art, you are required to follow-up with an actual Youngman one-liner.

Gorgeous literally came into my life offering two things: (1) her unconditional love, and (2) the largest amount of kitchen accessories I have ever seen outside of a Williams-Sonoma store. As you can imagine, I have reaped the benefits of having both of those gifts. Some things are indeed priceless.

What Gorgeous did not  bring to our marriage was money. She walked away from a long-term relationship in which the man in her life held strong to very conservative values and views when it came to money. Specifically, none of it was placed in a joint account nor anything specifically set aside for her personally. She was provided for in all areas but not with any specific financial remuneration. As a result, when she left that relationship she did so without the benefit of normal legal protections that one normally receives from settlements, alimony, etc. In addition, she also had no FICA or self-directed Social Security payments made during the 30 years of that relationship. So from 1982 to 2012 her Social Security record literally has zeros noted next to each year.

My response to this situation? I put her to work immediately to start earning an income and paying those important Social Security and Medicare taxes, etc. Then…

… I decided to retire in very short order. Pretty crafty, eh? I have conservative values too, but only as they pertain to me apparently.

Source: Worldartsme
Source: Worldartsme

My decision to take early retirement was predicated on the fact that Gorgeous and I would swap financial roles. Where I was the primary wage earner when we married, she assumed that mantle once I left the workforce. We are able to do this because she has a growing and very loyal client base who call her regularly to avail themselves of the services that she offers. But for her business, I would not have been able to retire early.

Between her income and the monthly annuity I receive from my former employer, our living expenses have fortunately come out lower than the original estimates we drew up in the months prior to my retirement. This is in part due to our living in a lower-cost state such as Florida, which has no personal state income tax, and our also residing in a third-tier city on the state’s “Treasure Coast.” What we lack in the way of available shopping offerings than what them fancy locales to the south and west of us have (i.e. West Palm Beach, Miami, Tampa, Sarasota), we also gain by living in a slightly provincial yet affordable place to live. Or, as I continue to remind my favorite film review blogger, JustmeMike, “$3.99 matinees here daily, Baby!

All of the above elements being in place are key to the relative success of pulling off this audacious retirement move.¹ For instance, should Gorgeous’ income suddenly take a dramatic downward dip, I would be in the position of pounding the pavement in search of a part-time job quicker than you can say the words “Wal-Mart Greeter.”

Source: http://dragonflycap.com Incidentally, check out the NBC sitcom "Superstore" if you haven't already. Very funny!
Source: dragonflycap.com
On a related note, check out the NBC sitcom Superstore if you haven’t already. It’s very funny! (NBC, feel free to contact me directly about payment for this unsolicited plug. You’re welcome).

Fortunately I have no children and Gorgeous’ only child is a 25 year-old adult who is financially self-sustaining (Hi, A). Other than a monthly alimony obligation, I have no monetary responsibilities to anyone other than the two of us and the Florida state lottery.² This too was an essential consideration in our decision for me to retire early. For example, I have several friends who are either still with children in college or helping to pay off their offspring’s post-graduation tuition bills.

The good news is I have no children of my own; the bad news is likewise that I have no children of my own. Someday I suspect one of my nephews will be called by a rehab facility about me. He’ll arrive with his sunglasses-wearing spouse who will stand in the corner of the room staring and not say anything, while constantly texting away on her phone and glancing up at the clock on the wall. There’s my 2:30 am nightmare!

But to forestall or possibly even negate such an occurrence, Gorgeous has embarked upon a savings plan that fulfills all of the wishes she had when she was a pre-middle aged woman. For the first time in her adult life she is now a proud owner — and when I say proud I am speaking of something akin to euphoria — of a Roth IRA invested in a mutual fund emulating the Standard and Poors 500 index. Last month she took $1000 from her latest earnings and made an initial investment, and this was followed by her first regular monthly contribution this month too. She’s determined to make regular such investments over the next year and beyond.

It was exciting and endearing to watch her make her first actual investment after years of only dreaming of such a possibility. Instead of staring at the Food Channel above her elliptical during her gym workout, I am noticing more and more how she’s instead glancing at CNBC as she learns the stock ticker symbols for the Dow, NASDAQ, Russell 2000, etc. Our morning coffee chat is lately more about the differences between stock and bond funds than Charlie Rose’s socks.

Source: Twitter
Source: Twitter

The maximum allowable amount to contribute to an IRA after the age of 50 is $6500 a year. It’s Gorgeous’ goal to invest that amount if not this year than next, and continue to do so for as many years as her business income allows. In spite of not contributing to Social Security for 30 years, she still is fortunate to only have three more years of contributing to make the minimum for a basic benefit. This is because of the years that she did contribute prior to the period when she stopped working. Let’s hope whomever wins the next election has a plan that will somehow keep the Social Security trust fund from going bankrupt. Perhaps Mr. Trump might have a few ideas about this since he seems to feel bankruptcy was a boon to his own business acumen. A fellow can at least fantasize for that anyway.

We’ll know in a handful of years how our plans shake out. If you see me wearing a blue vest and pointing to where the vitamin aisle is, you might have your answer.

Until next time…

¹ To my knowledge, I am the first of all of my same-age peers who retired early.

² As posted earlier, feel free to contact me if you are single male with both a pulse and an income. I have a woman I’d love to introduce to you. 

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14 thoughts on “Playing Catch Up

  1. Yay for Gorgeous. Very smart how her IRA rides the S&P. I entered the corporate world at 23. I am a financial moron. I made peanuts; however, I disciplined myself to pay myself first, both through contributing to a 401k and saving. It is amazing what compounding will do.

    Now, some 20 plus years later, I’m reevaluating my strategy by shifting investments. I’ve also bought “Money, Mastering the Game” and “Rich Dad, Poor Dad”. Both seem like excellent reads so far.

    Gotta run. Money talk actually makes me itchy. Enjoyed the post. 😃

    Liked by 1 person

    1. So many people have correctly learned that in spite of their salaries they can still build a very sizable nest egg by religiously “paying yourself first,” as you so correctly put it. With hopefully even some kind of a match by your employer, one can really have something for their retirement by contributing to a 401(k), 403(b), or similar. Sadly, though, many people don’t (or they take out the money early). Good for you for doing so!

      Liked by 1 person

  2. Sounds like Gorgeous turned her earlier experience around. Sadly, she should have left him when he didn’t share. Perhaps he didn’t go to kindergarten! I retired 4 years ago and my husband 3 years before that. The hard thing is that income is static. There is no hope of a promotion or a raise (don’t depend on Congress for that!). Even though we are fine now I worry that a major health catastrophe could deplete our savings. I know, worrying about it won’t help it or change it so what’s the point. I’ll keep an eye out for an eligible guy for your ex.

    Liked by 1 person

    1. Yeah, life gets complicated and we often don’t really get clarity about things till years after the fact(s). I know that’s certainly true in my case. The other old adage, “live and learn” certainly rings true for all of us. A health catastrophe certainly is on my mind constantly. I think it was a recent post of Nina’s that brought that home. I have a long term care policy (another post for another day), but Gorgeous does not. And even those plans have their caps that make them at times like fighting a fire with a water hose. Still, it’s better than nothing. Like you say, worrying about it won’t do anything… best to try to live as best a life you currently can! And, please do keep your eye out for me! 😉

      Liked by 1 person

  3. It sounds like you have things well planned out! I couldn’t imagine reaching middle age with no savings. Good for Gorgeous for getting back in the game and starting to build her nest egg. Not only does it allow you to goof off, but I’m sure it also gives her a great sense of satisfaction and comfort.

    Liked by 1 person

  4. Great stuff – saving money is always useful.

    By the way, I am leaving Sarasota and moving 387 miles northward to a town in Northeastern Georgia, and right near the state line of South Carolina. Besides a savings of $300 a month in rent – I will be living just 35 miles from my brother as opposed to the 430 miles in distance from Sarasota to Beaufort, SC. Plus a brand new apartment – never lived in before – new complex – gated community, brand new everything. And few a nice nearby city – Savannah, GA

    I like my current place in Sarasota, but I think it a good thing to save some money and be closer to family.

    Liked by 1 person

    1. Wow, big changes for you! It certainly sounds like a good plan to be closer to your brother, and being in a brand-new spanking apartment is always great too. I have a sister in S. California who just moved into a brand new place also, and she said it’s the best feeling. No stains, no cracks, etc., from previous residents. Good for you, Mike. I hope everything goes smoothly for you.

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  5. That sensation you described when Gorgeous opened her own Roth IRA … the way you described it had me reminiscing about the way I felt when I bought my first new vehicle after my divorce (after having been married for 18 years, in a marriage that was loosely modeled in the old fashion of everything always being in the husband’s name). The first time I purchased a vehicle, I became someone I didn’t know I was capable of being. It only got better from there (such as when I bought my first home, etc). But your words immediately brought that sensation to mind, so obviously your description was communicated very effectively … and good for Gorgeous! I love hearing about people accomplishing their dreams and goals. Good work.

    Liked by 1 person

  6. Yeah for Gorgeous! You go girl… I was the fortunate one to “retire” early in our household. Actually I quit my job to join my husband who had moved to another state for a promotion – that was part of his plan to lure me there. It worked!
    So I’m assuming that you’re using all those kitchen gadgets to make some lovely meals for her when she gets home from a hard days work? Of course you are….

    Liked by 1 person

    1. Ah, he’s a tricky man, that Mr. AGMA. But he obviously knew a good prize when he saw one.

      Sadly (fortunately?), I am not allowed to touch most of those expensive gadgets. There’s a nasty rumor that I’ve ruined one or two of them from improper placement in the dishwasher or another similar such accusation. Works for me!

      Liked by 1 person

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