Chapter 27
Seeing Into Your Crystal Ball

In This Chapter
  • Looking at what may lie ahead
  • Considering your future plans
  • Understanding some myths about aging
  • Planning financially to make your dreams come true
  • Knowing how to age with style

Our world is in a tumultuous time, at present, due to the September 11, 2001, terrorist attacks in our country and the resulting chaos. Many of us are feeling decidedly and understandably uncertain about the future, and what it may hold for us and those we love.

Of course, even before the attacks, none of us would have been able to predict what the future holds. And most of us wouldn’t want to. Would you really want to know, for instance, at what age you’ll die, or if you’ll outlive your spouse? Isn’t it enough to know that there are both joys and hardships ahead, and try to prepare ourselves to deal with both as well as we can?

We can plan as carefully and thoroughly as we wish, but we really have very limited control over our lives.

Maybe you’ve been planning since you were in your 40s to retire when you reached 62, only to have illness force you to leave the workplace in your late 50s. Or on a happier note, you may win $5 million in the lottery when you’re 52 and decide to add an extra 10 years onto your retirement.

Just because we can’t know what will happen to us in the future doesn’t mean we should not be optimistic, and plan to live long and happily. And we can, and should, do everything possible to assure that will happen.

In this—the last chapter of the book—we’ll dare to look ahead and try to predict what our futures might hold. Knowing that our predictions are subject to change, due to circumstances beyond our control, we’ll move bravely ahead and have a look at the years to come.

What Lies Ahead for You and Your Family?

Hopefully, your life will move ahead as you’ve hoped and planned for it, staying pretty much on course. With good living and a dose of luck, we’ll live to watch our children grow up, and have many years with our grandchildren, great-grandchildren, and—who knows—great-great-grandchildren.

The average life expectancy is at 76.7 for men and 79.5 for women, and expected to continue rising. Treatments for our most serious diseases are improving rapidly and dramatically, and we’re learning more and more about the best ways to take care of ourselves. We should expect to live for many years, and as a result, we must make sure we’re prepared for many more years.

Go Figure
A national poll by The Los Angeles Times revealed recently that three out of four respondents feel younger than their actual ages. Those in their 70s and 80s say they feel like they’re in their 60s, and those in their 60s say they feel like they’re in their early 50s.

When you look into the future for you and your family, what do you see? Big, fancy weddings for sons and daughters? A trip to South America, and then a tour of Europe for you and your spouse? Maybe you’ve always wanted to move to the country when you retire, and raise horses. Or to start your own consulting business. Perhaps you see yourself going back to college, or as a caregiver for your grandkids, or running a dog training school.

Maybe you’ve assured your children that you’ll help them financially when they buy their first homes, or you’ve decided that you’ll set up funds for each of your grandchildren to give them a head start on their college savings.

You may have decided that you’re not the type to fully retire, and are busy looking for part-time or flex-time opportunities. Maybe you own and run a business, and have no plans of even slowing down as you reach your 60s and 70s.

All of these hopes and plans require different levels of financial planning. Big, fancy weddings require big dollars, as do college funds for four, five, or six grandchildren. It’s great to want to help out your kids and grandkids. Just be certain to make sure your own financial situation is where it needs to be before you start passing out money.

And, even if you’re planning on keeping every cent you have for yourself, make sure that your priorities are in place. That is, be sure that your retirement savings are adequate to fund the tour of Europe. You sure don’t want to end up broke when you’re in your 80s, sitting in a bare, cold room, with nothing but a 20-year-old photo album of your European tour.

Planning Things You Want to Do

One of the best things about getting older is that you probably have more options than you did earlier in life. Let’s face it. When you’re a kid, your options are pretty limited. Kids don’t have a lot of clout, and they pretty much have to do what their parents or guardians tell them to do.

Teenagers, while financially better off than any time in history, still have limited options. They have to go to school, which takes up most of their time. And, many of them have to work in order to buy all the stuff that advertisers and marketers tell them they need to have.

Teens end up having overflowing closets, and maybe their own cars, but they still have to deal with a limited number of choices.

Most college-age kids are either working, in school, or both, giving them little time to discover all of what else life offers. And young adults just getting started in life generally have to work pretty hard to get themselves established.

Options remain limited for those who have children in their 20s and 30s. Raising kids, along with all the other responsibilities of adulthood, takes a lot of time, energy, and money, leaving little of those resources left over.

Go Figure
Teenagers are estimated to have collectively spent about 155 billion dollars in 2000. That’s an increase of more than 50 percent since 5 years earlier. With the average 17-year-old spending more than $100 a week, it’s not hard to figure out why teens are such hot marketing targets, is it?

Once the kids get to college, you’re probably still working, plus spending a good deal of time worrying about tuition bills, the cost of textbooks, and whether or not Tommy’s learned to use the washing machine or if he’s remembering to set his alarm clock on the mornings he has classes.

Once the kids are out of college, though—maybe even out of the house—your life begins to slow down a bit. It might seem strange for a while to be able to actually read the entire newspaper before you leave for work, or to join a friend for dinner on a Tuesday night.

There are no more PTA meetings, or swim meets to eat up every Saturday afternoon between November and March. You no longer spend a couple of hours every day in your car, hoping you’ll be able to pick up Janie from dance class before Stephen has to be at soccer practice.

And, once your kids are moved out and supporting themselves, your financial burden is likely to be considerably lighter than in past years. No more tuition payments. No more car insurance for teenagers. No more low-rise jeans at $35 a pair, or $49 soccer shoes, or piano lessons at $25 an hour.

[image] Money Morsel
Instead of being nostalgic about time that’s passed, practice reveling in your newfound freedom and independence that comes once kids have moved out and started their own lives.

So go ahead and plan for those things you want to do. Delight in your options, and make the most of everything life has to offer. Take up fly-fishing. See New York City for the first time—or the hundredth. Go to a Broadway show, and dinner afterward. Buy a mountain bike and find some good trails. Finally play a round of golf at Pebble Beach. Drive along Big Sur. Drive across the country. Ride a mule into the Grand Canyon. Visit New England in the fall when the leaves are at their peak colors.

Helen Keller is quoted as saying, “Life is either a daring adventure or nothing.” Hopefully, you have the resources—time, daring, energy, and finances—to take advantage of your options and make your life fun and meaningful.

Some Misconceptions About Aging

We all know that elderly folks are those who sit around in rocking chairs all day, either puffing on a pipe or keeping busy with some knitting. They go to bed early, are always cold, and keep a constant watch on their digestive systems by eating only bland, dependable foods such as oatmeal and well-cooked meats and vegetables. Wrong!

The definition of elderly—much like that of middle age—depends on where it comes from. Lately, though, we’ve seen this breakdown of age:

  • Young-old is defined as 55 (yikes!) or older
  • Old is defined as 65 or older
  • Elderly is everyone over 75

Can’t say for you, but 55 doesn’t sound anywhere close to old to us, and at 75, we don’t think you’re ready to head to the rocking chair for good.

In fact, the current generation of older folks, those in their 60s, 70s, and into their 80s, are redefining the way society looks at, and thinks about aging. Many people are vibrant and active well into their 80s and beyond.

Go Figure
A nationwide poll showed that 25 percent of retired people said they stopped working too soon.

A book getting a lot of attention lately is Successful Aging, by John W. Rowe, M.D., and Robert L. Kahn, Ph.D. The book reports on the findings of a major scientific study of aging in America by the John D. and Catherine T. MacArthur Foundation. The study, as reported in the book, reveals six prevalent myths regarding older people.

These myths, which our society has bought into for years, are as follows:

  • Most elderly people are sick.
  • Elderly people don’t pull their own weight in society.
  • Elderly people are set in their ways (you can’t teach an old dog new tricks).
  • Elderly people aren’t mentally or physically sharp and alert.
  • Ailments caused by poor lifestyle choices, such as smoking, can’t be improved upon or undone.
  • Physical aging is primarily predetermined by genetics.

If you’re tempted to go along with these assumptions concerning elderly folks, you’d better think again. The study revealed that most older people are, indeed, not sick at all, but generally healthy. Nearly 90 percent of those between 65 and 74 who participated in the study reported no disability whatsoever.

And the study showed, most elderly people more than pull their own weight in society. One-third work for pay, and another third are busy volunteering in churches, hospitals, and charities. Most elderly people report that, to varying degrees, they help out family members, friends, and neighbors.

Scientists are increasingly convinced, the study reports, that only about 30 percent of physical aging can be blamed on genes. The rest is due to lifestyle and environment. The good news, however, is that we’re learning that problems caused by poor lifestyle choices, such as smoking or years of eating fatty foods, can be slowed down or even reversed when positive changes in habits occur.

While some elderly people might be resistant to change, there are many actually looking for new experiences. Older folks are using the Internet for shopping, keeping in touch with family members, and learning about all sorts of topics. They’re attending college classes, taking art lessons, and scheduling trips to Prague, Alaska, and Scandinavia.

And as far as physical and mental sharpness goes, plenty of elderly people are still running their own businesses, running in road races, and running for office in various organizations and groups.

As we age, isn’t it nice to know that aging isn’t something to be feared or dreaded? Getting older is a blessing, when you consider the alternative, and we must be sure not to let myths and misconceptions cloud how we view our futures.

Making Sure You Can Afford Your Dreams

If you’ve got dreams, you’ve got to have the means to fund them.

Whether your dreams include a vacation home, a brand-new home, or being able to leave a substantial legacy for your children, you must be sure that your financial situation can ensure them.

If you’re not sure whether you’re where you should be, financially, schedule yourself an appointment with a financial advisor. Have him or her review all aspects of your finances with you, and listen carefully to the advice he or she dispenses.

It’s a good idea, at this point in your life, to prioritize your future plans. Consider all of the necessities first, and then add on your wants and wishes. Remember that experts say many people run into trouble during retirement because they underestimate the number of years they’ll spend there. If you’re planning to retire when you’re 65, don’t assume that you’ll only reach the average life expectancy of 76.7 or 79.5.

We all know lots of folks—probably some in your own family—who are well into their 80s or even 90s. You shouldn’t assume that you’ll die at the same ages that your parents or grandparents did.

If you haven’t adequately saved for retirement at this point, don’t give up because you think it’s too late. Saving only $45 a week between the time you’re 40 and 65 will add up to $50,000 if you average a nine percent rate of return. Take a minute to think of how you could save $45 a week. How hard could it be? Forty-five dollars is one or two meals a week in a restaurant. It’s the blouse on sale in the department store that you like, but really don’t need. It’s that overnight getaway you were thinking about taking, or the fancy wheel covers for your car, or those fabulous new fingernails the technician was talking about.

And if you need to start saving more seriously than $45 a week, think about going credit free. Studies show that more and more Americans are loading up their credit cards while saving less and less. If you have trouble keeping your credit card in your wallet when you go shopping, leave it at home.

Decide that you’ll only use cash unless it’s a real emergency (a good sale in the Ralph Lauren department doesn’t count as an emergency), and stick to your plan. If you must, use a debit card, which is just like using cash. For some reason, though, many people find it more difficult to part with actual money than they do to hand over a credit card for a purchase.

Go Figure
America’s love affair with credit is reflected in both minor and major purchases. The average down payment on new vehicles has decreased from 25 percent in 1992 to just 7 percent in 2001.

Other methods of boosting your retirement account could include the following:

  • Postpone a major purchase, such as a car. Sure, you’ve been thinking about buying a new car for two years now, and there are some terrific buys these days down on the Acura lot. Just because your car is now five years old and pushing the 60,000-mile mark, however, doesn’t mean it’s a smart idea for you to run out and buy a new one. There’s no rule that says Americans shall only keep the same car for four, or five, or six years. Find a good mechanic and hang on to the vehicle you’ve got.
  • Trade in your large vehicle for a smaller one. A two-, three-, or four-person family, unless there are special circumstances, simply doesn’t need a Suburban or an Expedition. The SUV-craze has cost Americans millions and millions of dollars in gas and insurance costs, not to mention the initial prices of these huge vehicles. If you’re driving an SUV or a very large car for no good reason, consider trading it in on a smaller one. You’ll save money, and have a lot easier time in tight parking spaces, as well.
  • Take a good look at your job. If you’re badly underpaid in your job, consider looking for another one. Just because you’re in your 40s or 50s doesn’t mean that you’re tied to a job. Many people stay in jobs they don’t like or that don’t pay as well as they should, simply because they’re comfortable and reluctant to make a change. That’s not a good idea for either your career or your retirement savings account.
  • Stop supplementing your kids’ incomes. If your kids are on their own and working, don’t be tempted to continue handing over cash like they were still teenagers. Your primary financial responsibility at this point is to get your retirement account up to speed, not to be sure your 25-year-old can get that great new Jetta she’s been longing for.
  • Downsize your living space. If your kids are in college or moved out of the house, maybe it’s time to think about boosting your retirement account by moving to a smaller house or apartment. It’s a fact that one or two people require less space than four or five people. Just be sure, if you decide to downsize, that you really end up saving money. If your goal is to pump up your retirement accounts, don’t be sucked into buying a place that’s smaller, but actually more expensive than your current house or apartment.

When consulting with a financial advisor, be sure to share your hopes and plans for the future. It’s important that an advisor understands your goals in order to be able to help you figure out how to fund them.

Aging with Style

If you take care of yourself—physically, financially, and emotionally—you stand a good chance of aging well. Assume that you’ll live to be 90 or 95. Plan financially for 90 or 95. And, make sure that you have enough interests and things going on in your life so that you’ll still be having a great time at 90 or 95.

There’s no question that people who remain active, busy, and engaged in life and with the people around them are happier as they age. There are countless opportunities for older people. The question is, to what extent will you take advantage of them?

People who remain active and willing to take on new tasks and experiences as they age are those who age with style. They remain interested in what’s going on around them. They remain committed to ideals, organizations, and people. They remain caring, loving, and mentally alert.

Start now to assure that you’ll be a person who ages with style. Pay attention to your health—physical, spiritual, and emotional. Plan for healthy finances, and then put your faith in something larger than yourself and stop worrying. Have a great future.

The Least You Need to Know
  • Regardless of what we think lies ahead for us, we must be prepared for unexpected twists and turns.
  • Take advantage of the options you may have in mid life, and plan to do what you may not have been able to previously.
  • New studies support what we should have known all along; that elderly people can, and most do, remain healthy, active, and involved.
  • If you’re not prepared financially for retirement, consider taking some big steps now to get you on the right path.
  • Remember to stay connected, stay involved, and have fun as you age.
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