Let’s start by setting the scene. How did your retirement come about?
Unfortunately, circumstances forced me into early retirement. Throughout my 40-year career I worked as an accountant for a variety of long-term clients including restaurants, beauty salons and attorneys. When Covid happened, they all shut down. Basically, there wasn’t much accounting work for me to do for them. I used to work full-time, traveling to see one or two clients a day, and that had dwindled down to almost nothing. At the same time, my 90-year-old dad — who lived across the country all by himself — ended up selling his home to move in with me. He lived with me for two years before he passed away. The combination of that huge downturn in business and my dad moving in with me caused me to retire. I wanted to be able to take care of him without worrying about work, and I was lucky enough to spend the time with him that I did during his last couple of years.
What does retirement look like for you these days? Is it different from what you might have expected?
I was always the kind of person who liked to be busy. And I’m a morning person by nature. So, I would get up, work early, pack a lot into my day. Now I feel like I sleep a bit later, and it’s nice not to have stress or deadlines over your head all the time. Also, since I was in accounting, I could never take time off at the end of the year. I even had to plan the births of my two daughters so they weren’t at the beginning of the year because I knew I couldn’t take that time off and keep my business. When September rolls around now I don’t have to worry about that, and I’m not burning the midnight oil anymore. It’s nice to leave that life behind.
Having said that, there are different stresses these days - mostly monetary. When you know you won’t have a paycheck coming in for the rest of your life, it’s hard to plan for your money. You have to figure out where your priorities are, and how you’ll be able to make ends meet, particularly when you’re used to a certain lifestyle.
How did you prepare to cover your expenses in retirement?
I know now I could have done more planning. San Diego is an expensive place to live. I was married for 25 years, and I’ve been divorced now for 10. My husband and I bought our house in a nice area and were just tapped out in our early years. We had a 15-year mortgage, and he was also self-employed. We always had to cover our own medical insurance. We had two kids and the house — something was always popping up and it was hard to save. We both had 401(k)s that were self-funded, but we didn’t put much in and, when we divorced, he got half. I did get to keep the house, though, which I paid off right after the divorce. It’s a five-bedroom house so I’ve been able to rent out to two tenants, and my live-in boyfriend covers some of the expenses, too. I’ve gotten creative since I’m trying to put off collecting Social Security until I can take full advantage, and I won’t get Medicare until I turn 65. Right now, I pay $1,500 a month on medical insurance alone.
I also received an inheritance when my dad died, but it’s dwindled in the market significantly. What started out as about a million dollars is down to about $200,000 now. Soon I’ll be forced to start taking withdrawals, so I don’t know if the equity will ever bounce back.
What has surprised you most about retirement, whether money-related or otherwise?
The fact that you need the same amount of money when you’re retired as you do when you’re working has surprised me. You think that you won’t spend as much because you aren’t commuting or buying lunch, but you end up paying for other things. For example, I don’t have a mortgage, but the flip side is that everything else has gotten more expensive. I just got a $1,000 electricity bill, and that’s from barely running my air conditioner. I’ve also been volunteering for a dog rescue, but I end up spending a lot because I drive to pick up the dogs. I get them groomed or washed because they’re filthy. I foster them. So, I pay a lot of expenses for that. Even though I’m a volunteer, I try to help the rescues because they’re always broke. There’s always something to pay for unless you’re going to sit around watching television all day.
What would you have told your younger self about life in retirement?
I wish someone would have told me when I was in my 20s or even earlier to find a job with a pension. I guess that’s rare now. I went to school for business with a minor in accounting, and we didn’t get into pensions. By the time I realized how lucrative and nice they are, it was too late for me to find a job that offered one. I had some of the same clients for 20 or 30 years. I could have been at the same job for 20 or 30 years and gotten a huge pension.
What advice would you give others who are currently preparing for retirement?
I would say consider your risk tolerance very carefully before investing. One other big thing is that I was married for 25 years, and I always thought I’d be married and we’d have two sources of income and Social Security. I guess I was naïve. Nothing in life is guaranteed, so it’s important to consider that and make a plan that’s best even if you’re on your own.
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