Monthly Archives: July 2010

Where to Retire – a Boomer Case Study

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We continue  our research into options to move to upon retirement. Still not 100% sure we will not retire to where we are today since it has its advantages as a possible home base from which to launch our vacation travels. However, we are not immune to those dreams of the perfect retirement home in the perfect neighborhood where we can look forward to each day blissfully enjoying our senior lifestyle. In a previous blog “Retire to your Shangri La”, I discuss some keys to help decide where to retire to and/or if to move. Today I will use this guide to research one place that I believe could be our perfect retirement Shangri La.

Retire to Pacific Grove – does it fit the criteria?

I have been familiar with Pacific Grove on the California coast all my life. In fact, my parents went to Borg’s Motel for their honeymoon and return each year – rain or shine – for 53 years and counting! It holds a magical feeling as a vacation spot but how does it stack up as a place to move to and retire to? I have been researching as well as personally visiting the area to determine just that. Based on five variables – proximity to what you need most, weather, neighborhood, population makeup and density, and cost – here are the results:

(1)  Proximity to what you need most – once retired, we want  our family to be close enough to visit. Of course, we do not want them to be TOO close – no surprise door bells early Sunday morning or unexpected arrivals close to bedtime (like 9:30…). Our kids currently reside in the Bay Area and with Pacific Grove about 90 miles away, this fits – CHECK.

Also important is a small-town downtown within comfortable walking distance. The downtown area along Lighthouse Avenue is eight blocks from end to end, with small businesses on  each side. No big-name commercial food or drink in sight. Better still, it is three blocks from the ocean so as you walk the boulevard, a look over your shoulder and there is the blue Pacific with the nearby coastline hugging its periphery. CHECK.

And if we need something a bit more cosmopolitan – a night away for a fine dinner or a change of scenery – Carmel is five miles down the road.

(2)  Weather – on the coast means that dreaded FOG is a frequent visitor. The significance of this depends on the individual but no one wants to retire to a fog bank. So I strolled the downtown and asked the locals for their insight. Now they may have been trying to recruit new residents but to a one, each described typically some fog in the morning, burning off late morning and then returning in the evening. The day I visited (7/27/2010), I arrived around 11:30 and it was overcast but no fog at ground level. Within 30 minutes, blue skies and a temperature of 67. We personally do not mind a little overcast as long as sunshine arrives  before day’s end. Double checking, I went to a very helpful site http://www.citytowninfo.com and learned that historical temperatures range from a low in Jan of 43-60 degrees to a high in October of 51-70. For us, these temperate lows just mean more time in front of the fireplace! CHECK.

(3)  Neighborhood – my wife and I have got  a map to stake out different neighborhoods around Pacific Grove to investigate. First driving to get a lay of the land we then walked those most closely fitting our retirement checklist. Staying within our desired 3-5 blocks to downtown, ideally within five blocks of the waterfront, we were pleasantly surprised. Turn-of-the-century Victorians to brand new houses populated the blocks. Some neighborhoods had a more vacation/rental feel – lawns needing trimming, paint needing refreshing – but there were multiple locations that would work nicely for us. We found one that was SUPERBLY located, newly built, and stylish to the extreme. Then we realized that we are still a few years away from pulling the trigger on a retirement move so we saved the flier and headed down the street for a coffee.

And people in the neighborhood actually nodded and said hello more often than not, something Silicon Valley is not exactly famous for. So, looking good – CHECK.

(4)  Population make-up and density – Pacific Grove is a major tourist attraction, home of Cannery Row and the world-famous Monterey Bay Aquarium. With that come busy streets during weekends and summer vacation. I personally am not a fan of crowds so this is a drawback to this choice. Our saving grace is that once retired, we will have the luxury of avoiding busy areas on weekends and venturing outside, crowd free, on weekdays.  A compromise but not a deal breaker.

Returning to http://www.citytowninfo.com for some encouraging statistics on the local population, we find:

  • Total population 15,522 => not too big, not too small
  • 65+ accounts for 19.2% of the town with a median age of 44.7
  • English, German, Irish and Italian make up 42.8%

(5)  Price – this one is different for everyone so I will leave it out of the exercise. If we could not afford a reasonable home in Pacific Grove, we should not consider moving there to retire.

On a recent visit, I took my lunch down to the waterfront and sat on a bench, enjoying the sunny afternoon. In the water a handful of harbor seals sunned and precariously balanced on rocks too small for their plump bodies. A retired couple (my guess) walked by and asked, “Have you seen the whales? The krill are in so they are feeding right here.” They smiled, held hands, and continued down the path. I smiled as I strained my eyes searching the horizon. I think this will work…I think this will work just fine.

Don’t forget to pick up a free copy of my Navigating the Retirement Jungle, available upon request by mailing to lovebeingretired@hotmail.com.


Retirement Fears Confronted

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We work hard all our lives, often forgoing rewards today for the promise of a better tomorrow, building our nest egg in hopes of living long enough to enjoy a healthy, fulfilling retirement. Not an easy process with loads of stress and anxiety along the way. And then once we arrive at this “promised land” of senior living, a whole set of fears confronts us. Without addressing these to some extent, quality of life and our general wellness can be compromised.

How to fight  the fears

1. Running out of money before we run out of years – A study by the Employee Benefit Research Institute (EBRI) finds almost two-thirds of Americans in the two lowest pre-retirement income levels will be running short of money after 10 years in retirement. Mark Miller of Retirement Revised http://retirementrevised.com notes that those most at-risk are the older baby boomers now approaching retirement age. Nearly half of older boomers (47 percent) are likely to run out of money, compared with 44 percent of younger boomers. This can keep you up nights unless you take action and do what you can NOW to prepare.

I touched on budgeting for when you retire in “Retirement – can I afford to retire?” . If finances could be a concern at some point, for your peace of mind, it is time to become a “shopper”, ever vigilant for the best prices for travel, dining out, household repairs, groceries, you name it. The internet is your friend when it comes to comparison shopping and getting honest feedback from services like yelp. A regular trip to Safeway, nicely air conditioned on those hot days, allows you to learn what prices are really “sale” prices and then wait for the right moment to buy. For me, it is even a bit of a game. For example, I know Groth Sauvignon Blanc at $16.99 on “sale” will routinely drop to $14.99 a bottle, just a matter of time before the REAL sales price surfaces. And I maintain a spreadsheet with monthly expenditures against a set budget to identify areas where I may be overspending or can cut back. There are numerous ways to save money in retirement – you just need to put them to use.

2. Health concerns – no way around this one as aging takes its toll on us physically and mentally. Exercise is the best ammunition to fight the battle including physical exercise (something that you enjoy doing so you can keep at it; not too strenuous; done consistently; a partner can be a big help motivating and staying the course), mental exercise (keep the ‘ol brain working with games like Sudoku, bridge, chess, crosswords), and social exercise (talking with your friends, community centers for interaction, and the internet for communicating and following interesting blogs). Each of these is important for overall wellness and combined can help to maintain a healthier mind and body.

3. Boredom – to minimize this, you need to keep moving physically and mentally. If you do nothing, you will tarnish and rust like an old car. Try this – listen to your imagination. Think about what you can be doing, visualize it, imagine doing it, and give it a try. Don’t be afraid to step out of your elderly safety zone a bit – try a different route on your nightly walk, think of something uniquely nice to do for a neighbor and DO IT, broaden your movie interests, keep adding to you list of favorite authors (Amazon is great at making recommendations based on your current likes), stay some place different at your favorite travel destination, or begin the search for a new favorite vacation spot. I am fortunate in that I am generally able to entertain myself. As a kid, I remember my imagination ever active, sometimes playing football catch with myself (“the pass is up, the fans are screaming, TOUCHDOWN!”) sometimes fending off pirates to save the fair maiden. Imagination and the will to try something new helps keep life fresh. And since we all have varying degrees of imaginative natures, don’t forget interacting and sharing with others at local senior centers, clubs, online communities, walking partners, etc.

4. Will I become a crabby old man? Do you remember when you were growing up that old guy on the corner lot who patiently waited for an unsuspecting youngster to cut across the lawn which then resulted in crazed shouts and threats thrown mightily into the afternoon air? Even if you were without such a character in your neighborhood, you surely do not want to BECOME him in yours. It is important to remember that we were all once young and impetuous. The little annoying things that kids do today – we did similar and maybe even worse when we were that age (remember how much fun that was!). Patience is a virtue. Accepting aging is part of the program. Take a deep breath and let it go and enjoy. The only grouch in the neighborhood should be Oscar the…

5. What if I can no longer drive? – This is a tough one. The ability to drive provides seniors with independence which is vital to self worth. We hate to rely on others to do the basics like drive to the grocery store or visit Blockbuster. Public transportation is nowhere near where it needs to be to effectively reduce our dependence on cars. Realistically, it comes down to each of us. The ultimate decision if you can safely manage the roads and traffic can only be accurately judged by you. Each individually, only we know if we should surrender the keys. Remember that in the end, the decision made has to be what is best for everyone concerned.

So, a partial list of fears we may face as we age. Some may feel them insurmountable but unfortunately there is no place to hide. Family and friends can offer encouragement but ultimately we deal with these by our self, alone. Bottom line, I believe it is the attitude with which we face each day that can most impact our quality of life. Feeling positive each morning, being thankful, and starting with a smile can go a long way.

Don’t forget to pick up a free copy of my Navigating the Retirement Jungle, available upon request by mailing to lovebeingretired@hotmail.com.


Can You Afford to Retire?

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Retirement looms on the horizon out there, somewhere, for each of us. Are you ready for retirement today? If not, when do you want to retire? When CAN you hope to retire? And what can you do NOW to assure that satisfying lifestyle you want and deserve? Take a look at the Social Security Retirement Planner and you will find a myriad of variables that go into evolving a successful retirement strategy. Within that list, there is one consideration generally first and foremost.

When Can I Afford Retirement?

So you are contemplating exiting the working world to take on the full time challenge of entertaining yourself and your spouse for the rest of your lives. You want to be mentally, emotionally and financially prepared for the many significant changes across all aspects of your life.

So what about the money? Running our of money is a common retirement fear. Start creating your financial strategy by putting on your budgeting hat. Your goal is to figure out how much money will you will be spending compared to how much money will be coming in.

First some good news – some of the expenses that occupied your pre-retirement budget spreadsheet are no longer! Take a look at how your retirement expenditures will change in retirement:

  • Mortgage – ideally at this stage, your home is paid off. If this is not the case, the likelihood is that you are living in a smaller house or condo which reduces your monthly payments.
  • Education – the kids are outta there and on their own (hopefully…) so this debt is paid in full
  • Car Payments – you own your car(s)
  • Retirement savings – you are no longer putting money into this fund
  • Commuting – a thing of the past

All of this helps with your bottom line. However there are basic costs that you will still bear. Some estimates are 70% of your pre-retirement salary each month go to meet your living expenses.

  • Food – you gotta eat. Track your monthly expenses for a few months to determine a baseline amount.
  • Medical – part of aging, these will be with you for the duration. Be sure to track your monthly prescription expenses. Here is a link to Medicare prescription coverage details.
  • Travel/entertainment – you will want to do more of this now that you are retired so be realistic in setting the amount
  • Gas (maybe an electric car in your future!)
  • Utilities – phone, electricity, internet
  • Insurance – car, home, health
  • Outstanding loans and financial commitments
  • Lotto tickets

On the flip side, you need to take a look at your sources of income which include:

  • Social Security – according to the Social Security Administration, SS benefits account for 39% of a typical retiree’s income. Start by estimating your Social Security earnings based upon when you retire. The longer you wait before starting to receive your benefits, the bigger your check – you can start receiving social security at 62. But if you do, there is an earnings cap – in 2010 dings you $1 in benefits for every $2 you earn over $14,160. When you reach the age of full retirement (65-67) you can earn as much as you want without impacting social security benefits.
  • 401k, IRAs, pension funds
  • Investments – dividends from stock, bonds, CDs, annuities, etc.
  • Continuing work – part time, internet-based, consulting, etc.
  • Other income – rental units, etc.

If there is one category of blog that is more widely represented in the blogsphere than any other, it has to be financial. There are banks, investment institutions, insurance companies, government sites, and individual financial planners with broad knowledge and experience in all things financial. They are good resources.

Discussed above is a basic exercise, a broad brush stroke in the painting of your retirement landscape. You need more planning, research and experienced advice to provide for your eventual peace of mind. But hey, you need to start somewhere…

Don’t forget to pick up a free copy of my Navigating the Retirement Jungle, available upon request by mailing to lovebeingretired@hotmail.com.