My girlfriend’s parents are lovely people. They did everything right. They worked hard, raised a wonderful family, and saved and invested diligently. They met all of their financial goals, having saved enough to retire, send their kids off to their own lives, and travel the world.
Then the worst news imaginable happened.
Terminal prostate cancer at 64. By the time they found it, it had spread to her father’s lymphatic system and his bones. Prognosis: 2-5 years, probably closer to the lower end.
That diagnosis came in 2014, when I first met the woman I eventually want to marry (if she’ll let me). It’s been 2.5 years since and it’s been a roller-coaster for the whole family. He now resides in palliative care, where he is as comfortable as he can be based on the situation he’s in.
With 110% certainty, this is not how he envisioned his retirement.
It is a universal experience we millennials have watching the boomers age. Some boomers are quite lucky and are living the retirement dream. Others are still working away, struggling to keep a roof over their heads. And the most unlucky are facing either mobility issues or serious life threatening health crises.
For all the literature out there that tells us millennials to save, we are faced with our own crisis: save for the far off retirement or live in the now. Many choose the latter, but take it to the extreme, spending large portions of their take home pay or taking on debt to finance the latest gadgets, cars and/or weekly unsustainable dining or partying experiences. It’s as if we view the whole live now or save for retirement dilemma as binary. It’s not. You can achieve both.
I have asked my parents and other boomers I’ve met what their retirement dreams are and their answers are what you’d expect. Travel. Reading. Writing. Painting. I imagine that list is what many of us want in retirement for ourselves: leisure time to do what we want.
So if that’s what you want in retirement, why do we settle for imagining that those things can only happen in the far off land of after 65? Why not sooner?
Most literature out there says saving 20% of our income is the way to go to have a nice nest egg in retirement. But what if you saved 40%? 50%? 60%?
The math out there proves that 10% shifts in savings can either delay or accelerate your retirement by up to 17 years. Using the 4% rule, if I’m able to save 55% of my income, I need to work 14.5 years. That means I’m 2.5 years down, 12 to go.
If we envision a retirement of travel, reading, writing, and painting – those activities we value and dream of – then why can’t we try to do them now?
What if instead of spending those weekend dollars on expensive activities, you chucked that money in low cost index funds and use your time to read or write that book you’ve wanted to write?
What if instead of going out for drinks, you hosted your friends instead and saved the cover fees?
What if you took that leisure money you saved and used a small portion of it to experience a frugal vacation at peak physical health? Can you imagine hostelling at 65? Nope. Hostels and frugality now, resorts and extravagance later.
Most of the dream retirement activities are accessible to you sooner than you think. We don’t have to wait to 65. Through diligence and a little effort, we can get them now.
So go out and get them.
Update: On July 23, 2017, Mr. B passed away at age 66. He is survived by his wife and two daughters.