In the precious summer months between the eleventh and twelfth grades of my public education, I kinda imploded. My personality started to take a sudden and harsh turn towards the introverted, which was expedited by the onset of a pretty brutal episode of depression. When I got back into class for my final year of highschool I was utterly overwhelmed and hopeless. I just couldn't cope with my new reality, so after I had withdrawn from social activities and all other optional expectations, I started to withdraw from the onslaught of waking life by sleeping 16-18 hours every day. This lasted for about a week, I think, before I finally bottomed out. I decided to gut my class schedule and fill up on spares, peer tutoring, and work experience. Anything to get me away from my peers and the standard grind.
One of the courses I decided to dump was Math; while I was a solid B+/A- student, the course work had gotten too abstract and tedious. I knew I could still probably do it, but like a sinking ship, I was rabidly ejecting all non-essentials in an effort to keep my head above water. I remember passing my math prof, Mr Watson, in the halls after I had dumped his class. He looked at me and quizzically asked if I was sure I was doing the right thing. I don't remember my response, to be honest, but his parting words kinda stuck around: "Okay, well, I just don't know what universities will still take you in if you don't have your math credits..."
And I mean, that was the whole point to this school thing, right? Get good grades so you can enroll at a university for four years, and come out the other side with a degree. Get yourself a respectable career position, so then you can choose a dining room set for the new house, send postcards from your exotic vacations, pick up a set of untouched keys from the dealership, and start an education fund for your kids so they can do it all over again.
A couple months ago I started a financial plan with an adviser at my bank. We looked at my accounts. We looked at my expenses. We looked at some superficial flashcards that identified different categories of what I valued. Then she went on vacation and I went to see her a month and a half later to get my results.
$1600 a month. I need to save $1600 a month, every month, for the next 400 months so that I can retire at 65 with an income slightly above the bare minimum. I will not be spending my golden years by going on yearly cruises to Mexico or buying a new beige Camry or having breakfast at the corner cafe five days a week while griping about politicians. No, my retirement will get me a vacation every couple years, enough to keep a used car on the road, and maybe keep a simple gaming computer running. Not poverty by any stretch, but maybe two and a half steps up from that. And it's going to only cost me $640,000!
The real kicker? I need to be saving $1600/mo on top of an almost maxed-out retirement account.
So I did some number crunching. Let's assume that I'm working a job that pays a slightly above-average $65,000 a year, of which I get to keep about $52,000 after tax. Let's further assume that I spend about $2000 a month on the necessities - rent, utilities, food, clothing, basic transportation. That means that after our dear long-term companion Retirement Savings takes its regular contribution, I'm left with $750 a month. If I want to eat out, see a movie, get a new sofa, go on vacation, buy a new computer, save for a car, feed/clothe a child, it all has to come out of that $750. That's not a lot of breathing room there.
And my thoughts turn back to that innocuous comment about getting into university, and I get so... mad. We were sold a story: get the education, the job, and everything else will take care of itself. The problem is that this wonderful narrative was authored way back in the 50's, where a single salary position could afford the new car and house and yearly vacation with a bit of room to spare. Back in the 50's when you could actually live on a minimum wage job and benefit plans were plentiful.
My financial planner said, "Oh, don't worry - you are in fantastic shape compared to most people I see your age. You have nothing to worry about. Maybe when it comes time to switch jobs, consider finding one that offers a pension or some sort of matching financial contributions!"
Wait, what? Two things:
a) Where the hell do you get a pension these days? The only people I know of that have one work for the government (health, education, libraries, municipalities, etc). None, and I mean absolutely none of the people I know working in my industry have a pension.
b) What does this mean for people who aren't in as good of a position as I am? I have siblings and friends that are just getting by and struggling just to become debt free, never mind saving for retirement. And in some cases, never mind even moving out of their parents' house. How the hell are they going to save for retirement? How much will they need to put away every month? Something tells me it's going to be way, way more than $1600 a month.
I just feel so... Lied to. God damn. It's like we were sold this ideal that if you worked hard and got an okay job you wouldn't have to stress about all this. That you'd have what you need to live your life and save and not put yourself on a strict budget just so that you could afford to not work some day. And maybe that was once the case, but it sure as hell isn't any more. And in 30-40 years, we are going to have some serious problems as people realize that it's stupid expensive to not work all the way into your early 70's. I don't know very many people my age who are on top (or even remotely aware) of what they need to be doing. This is terrifying.
And the people I know who have pensions? I'm not so convinced that they recognize what they have, man. They don't realize how rare and valuable such a thing is. You have a steady job with a pension? That's worth an extra $18,000 a year on top of your salary. That is good money my friend, so don't let go of it.
Do you know that a person working in a sales/retail position in 1968 was making today's equivalent of $54,000 a year? That's right, someone with no post secondary degree at all would be earning about 10% more than someone now with a bachelor's degree.
My financial adviser made chipper suggestion: I could drop that $1600 monthly amount to just $800! All I have to do is take all the other savings I've put away since I graduated and lock it in for retirement! Wow, so easy!
Holy hell. All I have to do is say goodbye to every penny I'd saved for a new car or a trip to Europe. All I have to do to start living my life is give up on any progress I'd made over the last couple years and start over again. That just hurts... but I'm not sure if it hurts more or less than that extra $800/mo I wouldn't have to be putting away.
I went into the whole financial planning thing stupidly hoping to get a bit of release. That someone would tell me, "Wow, your extreme financial anxiety has really paid off, and you're in awesome shape for retirement! You just need a couple hundred a month and you're all good - you can relax now, and start living your life!" I kinda just wanted to hear that it would be okay and I finally didn't need to spend each decision stumbling around under the shadow of, "YOU NEED TO SAVE, YOU NEED TO SAVE MORE YOU IDIOT."
Alas, no release. Just a rude awakening. Yes, I guess I'm in 'good shape' or whatever that simplistically optimistic lady at the bank says... But it sure as hell doesn't feel like it. $1600 a month is not a little bit of money, especially just to unlock a late, simple retirement. It's just so discouraging to know that I've trudged this far only to remain such a dauntingly barren distance from anything I could call home free.
And it makes me that much more afraid for those I care about that aren't in very 'good shape'. Comparatively, I feel really, stupidly lucky.
But when you take a step back, it all just kinda... Sucks.
-Cril
So your home town's bringing you down
Are ya drowning in the small talk and the chatter?
Or you gonna step into line like your daddy done
Punching the time and climbing life's long ladder?
You've been howling at the moon like a slack jawed fool
And breaking every rule they can throw on
But one of these days it's gonna be right soon
You'll find your legs and go and stay gone
Young man, full of big plans and thinking about tomorrow
Young man, gonna make a stand
You beg, steal, you borrow
Ya beg, ya steal, ya borrow
Ray LaMontagne - Beg Steal or Borrow
1 comment:
I'm hoping they legalize the euthanasia thing so I can get out of being broke as fuck and unhealthy in about 20 years. Maybe 10 years.
Keep in mind that you can always do riskier things with retirement savings that can yield more faster. Or lose more faster.
There are also people who move to other countries to take advantage of lower cost of living. You should talk to Zev about little things he does to manage his money. He invests in properties so he can build his money and so there's a steady income. But he had a base to build off of already. You could also always try to find jobs at companies that do the matching thing. I'm lucky I started working at one of those places a long time ago. As you move around in the company, you keep what you've built up. My job doesn't pay as well as other places, but one of the benefits is that it gives you 5%, and matches whatever you put in up to 5%. So every month, 5% of my paycheck goes toward my retirement and my job will also throw in 10%. I don't see it now, but I'll see it later, I hope.
Or the economy could collapse and I'll let a bear rape and eat me.
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