Tuesday, July 29, 2008

Not Sure What You Love?
Take a Look at What You Hate!

One of the main tenets of the Platinum Living Network is that "getting the best out of the rest of your life" involves the discovery, cultivation and pursuit of one's passion(s). Just about everything I have read, or written, on this topic, includes "passion discovery" as a basic step in the retirement process, and a key to answering that all-important question, "What do you want to do with the rest of your life?"

When I covered this topic in February, I shared some simple tests which are designed to eliminate the perceived constraints of money or time in order to help you discover your true passions.

Recently, however, I was reminded of another effective method of self discovery, which comes at this target from the OPPOSITE direction under the premise that an equally effective way to discover what you LOVE might be to look at what you HATE.

When I first heard of this, I have to admit that it was one of those "light dawns on Marblehead" moments. It's so obvious, and yet I had never thought to approach it in that way. The speaker used an example that will no doubt be very familiar to all of you boomers out there... Popeye the Sailor. To refresh your memory (or for the uninitiated), every Popeye cartoon followed the same basic format. Popeye's arch enemy Brutus would be bullying either Popeye or Olive Oyl, and his evil deeds would get progressively worse until Popeye finally reached the limit of his patience, at which point he would utter his famous line,

"That's all I can stand, I can't stand no more!"
At last, he would produce his can of spinach and set the world right again.

For many of us, our life passion is all about setting something right again. There is something that we have seen in our lives that we hate so much that we have had that same feeling ... "That's all I can stand, I can't stand no more."

For some of us, it may be disease that afflicts a good friend or family member. For others, it may be an injustice that makes us so angry that we just have to set it right.

So here's another tool that we are putting in our Platinum Tool Box to help you "find your passion." If our other passion tests have left you cold, maybe the key to finding what you LOVE to do is all wrapped up in setting right those things you HATE. - Bob

Wednesday, July 16, 2008

New Platinum Book - "Don't Retire, Rewire!"

I knew I would probably recommend this book from the moment I read the title. But the subtitle put me over the top - "5 Steps to Fulfilling Work
  • That Fuels Your Passion,

  • Suits Your Personality,

  • and Fills Your Pocket"
In setting forth these three attributes, the authors, Jeri Sedlar and Rick Miners, apply their 25 years of experience in personal and professional transition counseling to identify the key ingredients of a successful "second half of life."

I have written pretty extensively about the importance of pursuing our passions at all stages of life, and we have dabbled with personality issues, particularly through our recommendations of the book Authentic Happiness and the associated website, www.authentichappiness.org, where you can find a number of free personality tests.

And although I have not written directly about filling our pockets in retirement, or "rewirement," this idea is implicit in my encouragements not to take social security or other pensions too early for the sake of "flexibility." In this case, we are talking about the flexibility to bring in extra income without limitation and to keep on improving your eventual retirement situation. And the flexibility gained from the income supplements earned as we "fill our pockets" with encore career income also allows me to use the cavalier "number, schmumber" response to those who are a little preoccupied with reaching their "retirement number" and going fishing.

So I am very sympathetic to the conclusions of this book, but that, in itself, doesn't merit a "Platinum recommendation."

If you tend to like a step by step approach, this book is definitely for you. But even if, like me, you don't want to formally complete the exercises the authors present, I think you'll still find the lists, examples, and case histories in this book to be valuable idea generators.

I like the fact that the authors hate the word "retire" as much as I do. They have even gone so far as to TRADEMARK their suggested replacement word, "rewire," as a substitute... (that puts me off just a bit ... but I digress).

The book begins with some examples of people who, by their own admission, "flunked retirement," including former Chrysler CEO Lee Iacocca, who is quoted as saying,

"You plan everything in life, and then the roof caves in on you because you haven't done enough thinking about who you are and what you should do with the rest of your life."
And that, after all, is the mission of the Platinum Years Network and of this book. And the book gives us all some great new tools to do just that - think about who you are and what you should do with the rest of your life. So it should be no surprise that "Don't Retire, Rewire!" will be added to our list of Platinum Recommended books, with a next to perfect "four bar" rating. - Bob

Friday, July 11, 2008

A Dollar is a Dollar - Except When it Isn't

I grew up in a family that had to be pretty careful with money. I remember in early elementary school when school lunches were 23 cents, my two brothers and I each brought home our two pennies and deposited them in a jar which was earmarked for our first trip to a restaurant. We finally had our first restaurant meal as a family when I was about twelve years old ... at a local restaurant's "2 for 1 night." Actually, we didn't quite make it as a family. My older brother was so nervous about eating at a restaurant that he developed an upset stomach at the last minute and had to stay home.

Then I married Melanie, the "Platinum wife," whose money experience was, let's just say, the opposite of mine. Although her family was not wealthy by any means, her Dad always showered her and her siblings with pretty much whatever they asked for. This made for an, um, "interesting" first few years of marriage for us.

Yet despite our differences, there is one thing, financially, that we have in common in our approach to money. We both are quite frugal about some things, and quite the opposite in others, and I've noticed that this is true of a lot of people. When I briefly taught a class that included a smattering of economics, I remember teaching that some types of goods and services are very sensitive to changes in price (this is called "elasticity" of demand) whereas some commodities are quite "inelastic." (Unfortunately, the example we used for inelastic demand was gasoline, because people tend to view it as a necessity and would "shrug and pay" whatever the price was. This is still pretty true, although I think we've reached the point where SOME elasticity has begun to kick in... but I digress.)

There are even some goods and services where the normal price/demand relationship flips over and demand may increase as the price goes up. If I remember correctly, these are called "Veblen goods," and mostly include luxury and gift items and services. For example, if you want to buy someone a $20 gift, and you find the perfect item for $10, you might be reluctant to buy it. And what would be the fun of buying a $50,000 car or $10,000 watch if any Tom, Dick, or Mary could afford one?

And so it seems, as Melanie and I have realized, that a dollar isn't really worth a dollar. Subconsciously, we view some dollars as very cheap and others as very dear. Why, for example, will we spend two hours online to save $20 on an airplane ticket and then fight for the right to pick up a $100 check in a restaurant. In my own daily life, my "portfolio," and those of my clients, can rise or fall by the thousands from hour to hour, but after work, I'm still just as likely to stand in an aisle at the supermarket and think, "Gee, I can save 30 cents if I buy the economy size." Are "grocery dollars" that much more valuable than "restaurant dollars"?

I'd like to tell you that I've found a logical solution to these inconsistencies, but I really haven't. In some cases, they're relatively harmless, but in others, they can result in very real budget shortfalls. But I think I have a little better balance ever since I became aware of my own inconsistencies. But I'm curious. Does anybody else out there have any insight into this phenomenon? Or better yet, solutions? - Bob

Tuesday, July 1, 2008

Is Early Retirement Selfish? Unpatriotic?

A while back, I saw an article that labelled early retirement as "selfish and unpatriotic." I didn't pass it along at the time, as I felt that people shouldn't be made to feel guilty about checking out of the workforce and living the traditional retirement. I want the Platinum Years Network to be about helping people pursue their passions, and ultimately that is a much better motivator than guilt.

But this article keeps popping up here and there, and often generates some pretty passionate responses, and tonight I came across another such article, so I thought I would open it up for discussion. The first and older article is called, "Early retirement is an act of selfishness," by Andrew Yarrow, vice president and director of the Washington, D.C., office of Public Agenda, a nonprofit, nonpartisan research organization. Yarrow urges the nation's 78 million baby boomers to forgo traditional or early retirement and work for a few more years, for their own sake and the good of the country.

"When I hear my fellow baby boomers gleefully talk about their elaborate plans to retire ASAP, head for the Tuscan hills or otherwise continue their lifelong quest for self-actualization, I have to bite my tongue."

"Dropping out of the workforce while still in one's prime means ending one's contributions to America's strength, mortgaging our children's and grandchildren's future and leeching trillions of taxpayer dollars from the economy."
Now I have to admit that I sometimes bite my tongue as well, especially when I hear someone paint a picture of an "all leisure" retirement, but rather than criticize, I try to draw out what, beyond golf or whatever, they are passionate about... and there's usually something. But certainly people who have worked hard all their lives certainly have the right to do anything they want, and they shouldn't have to feel guilty about it.

And that's probably why, even though Yarrow's main points ring true, his article generates an emotional response in many people. Guilt is such a poor motivator... Not that it doesn't work. It just generates a grudging response, as anyone with an Italian or Jewish mother will attest ... but I digress :-)

The second article, which pushed me to bring up this issue is from Bankrate.com, called "Is Retiring Early Unpatriotic?" The author, Jay MacDonald, quotes Yarrow extensively and then examines some of the demographics and trends in play as boomers begin to exit the workforce. MacDonald also quotes Ben Stein, economist, actor, and author of, "Yes, You can Retire Comfortably":

"I don't ever expect to stop working," he [Stein] says. "I love my work. I don't believe there is a meaningful life without work. You're not a whole person without work."
In this context, I would define work in its broadest sense, encompassing volunteer work, part time, full time, you name it. I think one of the reasons people react so strongly to these types of articles is that they feel "guilted" into a continuation of negative work experiences.

So I want to use these articles as a jumping off point for a couple of things I've been working on. First, a review of the book "Don't Retire, Rewire!" that I promised you a while back, and second, with an article about some of the fun "side jobs" that my friends and family, and I have had over the years. The kind of jobs that get you jazzed to go to work.

Hopefully, we can prime the pump to get us back on track and thinking positively about work in retirement, so we can all "chill out" with the guilt articles. - Bob

Sunday, June 22, 2008

What Have You Done Lately to Pursue Your Dreams?

I don't generally watch shows like American Idol, and I don't like opera very much, but I love seeing someone pursue their dreams, and I love it even more when they achieve them. So when I came across this video of 36 year old British mobile phone salesman Paul Potts' appearance on the "Britain's Got Talent" TV Show, I was mesmerized.

This clip is a little over a year old, so I apologize if this is old news to you. And Paul is not a boomer, either, although he is the type of underdog character that almost everyone loves to root for. You can easily see by the reaction of the judges, when Paul tells them what he's going to do, that their expectations are VERY low.

But then, a miracle happens. Paul begins to sing, the audience is transfixed, then moved to tears, and the audience erupts by the time he's finished. If you love the underdog as much as I do, you'll be fighting back tears. And no doubt you'll also want to see how it all turns out in this clip of his performance in the semifinals, where he describes how he was picked on as a little boy and how he lacks self-confidence. And if that's not enough, just search on his name and you can see his appearances on Oprah, the Today Show, etc.

The underdog subplot alone would make this story interesting. But the other inspiring aspect of this story is that Paul was laboring away at a humdrum sales job, with all this talent "hidden under a bushel." And that's the part that makes this story Platinum-worthy. Because I wonder how many of you are like Paul, toiling away in obscurity at some job you hate, having never even tried to break away.

I wonder how hard it was for Paul, with his low self esteem, to step out and expose his talents to the world. I'm sure he thought he wasn't good enough, just as beautiful people always seem to think they're ugly, and immensely talented people often think, "Anybody can do that."

Watching a video like that, welling up with emotion, makes me realize that I'm on track in pursuing my own passion, "helping you get the best out of the rest of your life." I'm glad I stepped out in faith a bit and started this blog. It was a small step, to be sure, but so many people don't ever even try. And as I always say, the nursing homes are full of those people. Remember from our last two blogs, it's not the failures or mistakes you'll regret. It's the roads not traveled and the opportunities not taken.

Unlike Paul, many of us (boomers that is) have the advantage of careers that are winding down, and some trailblazing resources like RebootYou and encore.org to help us out.

So what's YOUR passion? What step, however small, have you taken to pursue it? I'm rooting for you. - Bob

Wednesday, June 18, 2008

It's Unwise to Compare - But It's Human Nature

One of my former mentors was fond of using that expression - "It's unwise to compare." And I believe that using it as a guideline has helped me retain a positive perspective and outlook. Because within me, and probably all of us, is a nagging feeling that someone is doing better than I am, someone is getting an advantage, someone is luckier, etc.

The examples above are all examples of "comparing up," that is, comparing ourselves to someone doing better than we are. And this common human trait contains within it the seeds of jealousy and envy, the drive to "keep up with the Joneses" in the pursuit of material wealth, and the uneasy feeling that "the grass is always greener in the other fellow's yard." There is even a common phenomenon called "schadenfreude," a German expression meaning "happiness about the misfortune of others." Why else would shows like Cops or Jerry Springer be so popular, or why would we enjoy watching a criminal being taken off to jail in what has come to be known as a "perp walk"?

These feelings have been around so long that the bible even covers it. In Paul's second letter to the Corinthians, he states that "measuring themselves by themselves, and comparing themselves among themselves, they are not wise."

You can always tell when someone has a weak argument, as soon as you hear the phrase, "but what about so and so" creeping into the discussion. It means you're about to hear a comparison that is supposed to make your point invalid. For years, a discussion about business ethics could be sidetracked by, "but what about Enron." For over a decade, any discussion about government spending would involve the proponent of more spending saying, "If we can put a man on the moon, surely we can (fill in your pet project here)..."

So why am I bringing up this philosophical point at this time? Because I'm still thinking about my business acquaintance who died... and my reaction to it. You see, ever since my mentor cautioned me against comparisons, I resolved that I would try very hard to only allow myself to "compare down," that is, to acknowledge the pain of the less fortunate, and thereby count my own blessings... as in "there but for the grace of God go I."

After many years of practice, this now comes pretty naturally to Melanie (the Platinum wife) and me. Even when we were having a rough go of it ourselves, if we saw someone on TV who had lost a loved one, someone with a very sick or dying child, or someone themselves battling a pernicious disease, we would look at each other and say, "we don't have a care in the world." So it just came naturally the other day when I heard the news of that death.

So boomers, beware. One of the things about getting older is that there seem to be more opportunities to complain. Comparing the way things are to "the good ole days." Comparing the way I feel now to the way I felt in my prime. And there are still all those other ways to "compare up," as described above, that can apply at any age.

My mother used to spend the winter in Florida at one of those golf condo complexes. And I'll never forget the year I was visiting and the residents were at war with one another over whether the golf course tee times should be changed from seven to eight minutes apart... I'm not kidding.

Melanie's mother (which I guess makes her "the Platinum mother-in-law") often relates to us how much complaining goes on in her senior condo complex. This was a place designed to be as care free as possible, but she has to guard herself against entering into it. This phenomenon is so pervasive that the popular Seinfeld TV Series did several episodes about the microscopic lives of the elderly residents of "Del Boca Vista," where Jerry's parents lived.

Melanie works with a lot of 70-somethings and 80-somethings, and she has a theory that as we get older, our natural character traits and tendencies get stronger, and I think it's probably true. So the time to be vigilant, boomers, is now. This is another good opportunity for some "accountability buddies," (as described in "If You're Serious About Changing a Behavior - Do This!") to keep us on the straight and narrow.

Back in February I wrote an article called "Comparing Ailments - Nobody Knows The Trouble I've Seen," which described a very popular elderly resident of a nursing home I used to visit. That guy was positive, engaging, and appreciative, and was easily the most popular resident of the home. He lived in a place that usually smelled like urine, and from what little I knew, he had more than his share of ailments. But his positiveness stood out in stark contrast to most of the other residents. Thinking about him brings me back to that feeling again - "I don't have a care in the world." - Bob

Saturday, June 14, 2008

I Don't Have a Care in the World
(And Neither Do Most of You!)

I've been thinking about death today. Not by choice. It was placed in front of me. Twice. And I've found that when that sort of thing happens, it's best to pay attention. So I wanted to write down some thoughts and share them with you.

I generally really enjoy Saturdays, but today got started on the wrong foot. I had to set the alarm to get up early for an appointment, but as it turns out, the other person didn't show up. And then other impediments kept popping up which seemed to be conspiring to keep me from accomplishing ANYTHING on my Saturday "to do" list, so by noontime, I was in full "annoyance mode."

And then I got the news of the death of a man with whom I had just started to do some business. I can't say we were friends or anything, but in our few business dealings, I liked and admired him. He was about 50 years old, and had been in perfect health until about six weeks ago, when he started to experience some symptoms of fatigue and shortness of breath. The diagnosis of cancer came about three weeks later.

When I got the news, in the midst of my "annoying Saturday," my first thought was, "I don't have a care in the world." I finished up what I was doing, and headed home. When I arrived home, there was an email from a friend with this YouTube link. It is a video of a short graduation speech at Carnegie Mellon University. The speaker is Randy Pausch, a professor who was diagnosed with a fatal and incurable cancer and given 3-6 months to live, about nine months ago.

Randy's situation in turn reminded me of Eugene O'Kelly, the author of Chasing Daylight, one of my Platinum recommended books. O'Kelly was given a similar "death sentence," and wrote Chasing Daylight during that precious time period. The perspective that both Rausch and Kelly gained from their death sentences is remarkably similar. Here are Rausch's, from his speech:

  • It's not the mistakes we make in life that we generally regret. It's the things NOT done, and the opportunities NOT taken.
  • Whatever you do, and however long it takes, find your passion in life and do your best to pursue it.

Rausch cautions that you will not find your passion in money or things, but that every level you achieve will only cause you to want more. No, the passion he speaks of is "that which fuels you from the inside." And THAT passion will, without fail, be grounded in the people in your life.

I write a lot about pursuing your passion, because I firmly believe that doing so is the key to the Platinum mission of "helping you get the best out of the rest of your life." When I first read the O'Kelly book, the Platinum wife and I decided that we would periodically remind one another of its principles. The premise is that if we could live our remaining 20-30 years with the perspective of O'Kelly (and now Rausch), there will be no regrets when that day comes, no matter what the length of time turns out to be.

But I am well aware of how the day to day annoyances of "doing life" can bring us down, as was happening to me this morning. So my wish for all of us is that we can all learn from those who have experienced this kind of tragedy when they tell us what is really important in life. - Bob

Wednesday, June 11, 2008

"Number Schmumber"
Here's Why I Don't Like Retirement Numbers

My regular readers may recognize that "Number, Schmumber" phrase in today's title, because I've mentioned before that there's a tentative chapter called "Number, Schmumber," in my book-in-process, Platinum Living. My feeling is that one's retirement "number" is a moving target at best, and coming up with one requires a lot of static assumptions at a time when retirement itself is becoming more and more of a dynamic proposition.

To underscore my skepticism, here's a link to a June 9th article from Yahoo Finance entitled, "Is $1 Million Enough to Retire On?" I have recommended several Yahoo Finance articles in the past, but this is not one of them, except as an example of how narrow retirement thinking can get. Yep, this one really set off my "Retirement Hogwash Detector."

For example, the first heading has the scary title, "It's probably not enough," in bold, followed by a quote from the author, Michael Farr, of a book entitled A Million is Not Enough ... (Gee I wonder what his conclusion's going to be?) Although I don't disagree with Farr's recommendations, the little example he uses to make his point completely ignores social security in the equation. That is, since a million will only earn $50,000 a year, if your income needs are more than $50,000 a year, you'll eventually go under... duh!

The second section heading is actually accurate ... For security, try an annuity... It's just bad advice. This author recommends setting aside $200,000 of your million against "emergency medical expenses and buying an inflation protected annuity with the balance. In his example, the remaining $800,000 should be put into an annuity earning $45,000/year, and this, plus your social security (at least he included it) would amount to over $80,000/year and would replace a preretirement income of over $100,000. And actually, if you agree with his premise that the retirement income replacement rate is 80% (more about this later), this analysis is fine.

I have three problems with the annuity argument used here. First, I would never recommend that someone put 80% of their money in ANYTHING. Second, annuities really only make sense for older retirees, when life expectancies get low enough that there really is a premium for leaving your money to the insurance company. This guy is recommending that you do it for a return of 5.625% (45,000/800,000)! Thirdly, I believe that retirement, like the life that leads up to it, should be lived so as to give yourself maximum flexibility to pursue your dreams. And an annuity is one of the LEAST flexible of all investments.

There's a third voice in this article, a voice of reason. His name is Jonathan Pond, and his section is entitled "Stop worrying so much, and get out your golf shoes. Pond wrote a book called You Can Do It! The Boomer's Guide to a Great Retirement. "The financial services industry has made a good living for themselves scaring people," says Pond, a financial planner and author of You Can Do It! The Boomer's Guide to a Great Retirement. "For many people, $100,000 to $200,000 is enough to retire on."

That's certainly good news for many in the Platinum Years readership, and many of my middle income clients. Remember, one of our missions is, "Life planning for the rest of us."

There's another undercurrent of disagreement in the Yahoo Finance article. Just how much income does a person need to replace in retirement? Some say 100% or more, while financial planners like Pond and myself say much less. The financial planning industry in general is quite divided on this point, and yet it is key to the calculation of your retirement number.

I'll be blogging more on various aspects of this topic over the next few days, and I've also moved Pond's book up to the top of my reading list. Meanwhile, "stop worrying so much and go get your golf shoes." :-) Bob

Saturday, June 7, 2008

BoomerTowne Update - I'm Rich!

A while back, I reviewed the top ten Boomer web sites, and at the time, it turned out that my favorite happened to be PC Magazine's #1 rated site, BoomerTowne (see my review of April 19).

I can't say that I visit ANY of the others with any regularity, but BoomerTowne has stuck as a fun site to visit, play games and trivia contests, read jokes and quotes, etc. I used to play some of the games at Yahoo Games, but these are just as good, so now, when my brain is fried, I head to BoomerTowne games instead.

There was one other feature of BoomerTowne that intrigued me. They give BoomerTowne points for just about all the things you do there. Play a game? 10 Points. Rate a joke? 3 Points. Identify the song in the weekly contest? 100 points. They even give you 35 points for your first log in each day.

The reason that I'm bringing this up now is that I thought I'd see how long it took me to get to the threshold where the points had actual cash value. For me, that was a couple of days ago, when I passed the 12,500 points mark, which entitles me to a $25 gift card at either Target or Best Buy. Not bad for six weeks of mostly just having fun.

So much fun that I'm forging onward, because I don't need anything at Target or Best Buy right now and the 25,125 point threshold is worth a BoomerTowne VISA debit card charged with $50 of value. I'll keep you posted. - Bob

Wednesday, June 4, 2008

Four Legal Ways to Boost your Social Security Check

There’s an article in today’s Personal Finance section of Yahoo Finance called “Secret Ways to Boost Your Social Security,” so naturally, it caught my eye. The author, Mary Beth Franklin of Kiplinger.com, outlines four strategies that do just that. For you faithful Platinum Years readers, the first one will sound very familiar, since it involves paying back your social security to obtain a higher monthly benefit, a topic we covered in a series in February, most notably here, here, and here. Franklin does a good job explaining it, though, so it's a good refresher. There's also an interesting example of someone who took out a second mortgage to repay benefits and is using the increased payment to pay back the second mortgage.

There is also a clarification of the tax consequences of paying back your social security. If any of your social security benefits that you pay back were taxed along the way, you can get a refund, either through a tax deduction or a tax credit, whichever works to your benefit. What could be more fair than that?

The other three "secrets" in this article are all variations on spousal situations. One of these we have covered in the past, where the primary breadwinner keeps working and the lesser earning spouse starts collecting. This works best where the primary breadwinning is the husband, because the main benefit occurs after the death of the primary breadwinner dies, and the surviving spouse's benefit steps up to a level based on his earnings. The reason it works best is that we men are much more likely to die first, and in many cases, the widow lives on for many years. Obviously, this strategy works even better for marriages where the wife is much younger than the husband.

The third is another "spousal tactic," which works even when spousal incomes are about the same. This one is completely new to me, and the Platinum wife and I may use this one ourselves. It seems that once we both reach retirement age, if one spouse wants to continue working, they can still file for spousal benefits on the other's earnings without compromising their own eventual benefit. This one seems to good to be true, but that's what the article says.

Fourth is a little more obscure, but has to do with the children of "Do Over Dads," who have had children in a second marriage or otherwise late in life, that is those who have children under the age of eighteen when they start to collect social security. If that applies to you, I'll let you read that one for yourself.

I continue to be amazed at just how flexible the rules of social security really are. The problem really is not the flexibility of the rules. It's the education of the recipients. Which is, after all, where websites like this one come in. And we have our work cut out for us. Do you know how many of the 32 million U.S. social security recipients availed themselves of the fantastic opportunity to pay back past benefits to increase their future ones? A grand total of 71 people. Of course that was before the financial websites like Yahoo Finance, MarketWatch, Kiplingers, and of course, Platinum Years, told YOU about it. - Bob