This past week contractors finished several projects on the exterior of our Tennessee home: painting, Dryvit repair, and brick repair. These are just the beginning of a long list of repair and renovation tasks that need to be completed before we consider selling and downsizing. Although we are unlikely to put the house on the market for at least 19 months, it makes sense for us to spread the supervision and cost of these projects over time, particularly with so many contractors needing the work now. What are you thinking about downsizing?
I read (and watched) a few things this week to share with you. The first is this piece where the author cites data from the Employee Benefits Research Institute that between 2003 and 2008, the average 401(k) account increased in value by 7.2% annually. The the author compared this to the 30% decline in 2008 alone. (The article ignores the continued decline in the first quarter of 2009.) I don’t understand the point of the article. The EBRI data includes employer and employee contributions, not just market returns. None of that matters to a baby boomer who retires, stops contributions altogether, then experiences a market hit like we did in 2008-2009. I am persuaded that a 401(k) account invested solely in conventional equity and bond funds is not the path for providing a secure retirement income.
Further to my point, I found an article that summarizes the results of a personal finance survey recently conducted by bankrate.com. With the depressing title “Work is the New Retirement“, this quote is telling:
Yet, few retirees have reentered the workforce. Only 5 percent of current retirees are employed, the survey found. But most retirees (55 percent) worry about money and wish they had saved more while they were working. Social Security is the only source of income for 26 percent of the retirees. And the financial crisis has forced about a quarter of retirees (24 percent) to withdraw more money from their savings this year than they had been previously. Only 38 percent of the retirees think they have enough money saved to remain retired without financial worries.
Folks, we must find a way into a better financial future than these retirees are stuck with.
If you like thoughtful quotes about what we should be doing with our time here on earth, I came across this one on immortality from Baeth Davis:
The perception that we have unlimited time is an illusion. It is the illusion of our immortality that leads to many of our soul-killing choices.
The phrase “soul-killing choices” really hit home with me. The night before I read the quote, my wife and I had watched a clever movie called “Defending Your Life” starring Meryl Streep and Albert Brooks. The premise of the movie is that fear about life and relationships is an obstacle to “moving on” to your “after life”, whatever your spiritual beliefs tell you that will be. The movie is funny yet thought-provoking. That’s a rare combination today. I think a lot of boomers on the cusp of some important life planning decisions would enjoy watching this movie. I’m just glad that I have a wife to help me make those decisions.
I mentioned this piece from Steadfast Finances on Ten Reasons Why Gold Investing is a Bad Idea on my Tough Money Love blog but it’s a worthwhile read for all of us. Gold is an enigma. People buy it for the fear factor. But when do they sell it and take their profits?
So what’s on your mind? What should I be thinking and writing about?