LAPTOPS IN THE SAND

Retirement

Retirement ring and cup

I have retired after 39 years 7 months 16 days as a Senior Staff Consultant in a major telecommunications company.  “One job, one wife”-    Eddie Robinson Coach, Grambling State University.  My last tenure was in a strategic planning organization.

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I started here

and ended here

DN7200
Having said that, I would like to apply strategic thinking to the retirement planning process.

FINANCIAL ADVISOR

If you have not already done so, contract a financial planner.  A financial planner will help you figure out your financial goals, help you to determine your risk profile and will direct you on how to obtain your financial goals.  Ultimately, you make the decisions.  When selecting a financial advisor, I value character and integrity over knowledge.  This does not mean find the dumbest person in town.  The certification process and experience especially one who has experienced some economic down times, will filter a good enough financial planner.  An incremental increase in knowledge may gain you an extra $1,000 over your financial lifetime but at a higher cost of piece of mind.  Get to know your financial advisor personally.  For example and hypothetically if a financial advisor is cheating on what should be his closest relationships, his or her spouse and family, how can he be trusted with my money.  Trust is more important than that possible $1,000. How much is enough?  Proverbs 30:8 (NIV)  "Keep falsehood and lies far from me; give me neither poverty nor riches, but give me only my daily bread."

EXERCISE

Exercise, exercise, exercise. AARP, Amerirpise Financial Services and Ernie Zelinski, whom I will discuss later, all emphasize the importance of exercise.  What is the value of a fat nest egg, if it all goes to medical expenses?  A membership in an exercise class or club will not buy you good health if you don’t participate.  These clubs make their profits on no-shows.  Preventable poor health leads to a slow and agonizing death.

SOCIAL SECURITY

My best advice is to work with your financial advisor.  If at all possible, I would not make Social Security a dependency for your retirement plan.  Use it as a hedge against inflation, future investment and for "mad money".   Not everyone can do this.  This first thing that I would do is to obtain an Social Security Statement. Social Security Statement Request Form

With this information, you and your financial advisor can make a better decision.  This next question is whether to collect benefits at age 62 or at full maturity (FRA).  A lot is this is based on probability.   For me, from a purely financial perspective, the break even point is age 74.  In other words, if I received benefits starting at age 62, at age 74, I would have received the same benefits if I had waited until age 66.  Assuming that there are no catastrophe's, look at your family's history of longevity.  How disciplined are you is investing your benefits and how disciplined are you in not making your benefits as part of your budget.  Also keep in mind that if you work while receiving benefits, they are reduced if you earn over $13,560/year if you receive benefits before you reach FRA(Full Retirement Age). How much can I earn and still receive Social Security benefits?.  I am a layman on this issue.  Discuss it with your financial advisor and keep up-to-date by reviewing the Social Security Web site. Social Security Web site  See the updates listed below.

TAXES

Estimated taxes is the method used to pay tax on income that is not subject to withholding such as earnings from self-employment, interest, dividends, rents, alimony, etc.  In most cases, you must make estimated tax payments if you expect to owe at least $1,000 in tax (2008) after subtracting your withholding and credits.  Payments can be made with the vouchers included in Form 1040-ES.    The payment schedule in 2008 is as follows:

1st payment
April 15th
2nd payment
June 16th
3rd payment
Sept 15th
4th payment
Jan 15th

More information can be found in Publication 505. Also refer to Publication 554 IRS Publication 554

If you have earnings in a state with income tax, most likely the same or similar process will exist. 

Per What You Need to Know When You Get Retirement Or Survivors Benefits SSA Publication No 05-10077  SSA Publication 05-10077, “About one-third of all people receiving Social Security benefits have to pay taxes on their benefits. You will have to pay taxes on your benefits if you file a federal tax return as an “individual,” and your total income is more than $25,000. If you file a joint return, you will have to pay taxes if you and your spouse have a total income that is more than $32,000. If you are married and file a separate return, you probably will pay taxes on your benefits.”   You can have taxes withheld on the taxable portion of your Social Security benefits.

The information of this webpage is a heads-up only for new recent retirees and for those planning retirement in the near future.   It is not a substitute for referring to a tax professional, contact with the IRS and SSA or you own personal research.
See the following websites:

IRS

Social Security

PENSÉES

Avez-un verre de thé glacé.  “We never keep to the present.  We recall the past, we anticipate the future as if we found it too slow in coming and were trying to hurry it up, or we recall the past as if to stay its rapid flight.  We are so unwise that we wander about in times that do not belong to us, and do not think of the only one that does; so vain that we dream of times that are not and blindly flee the only does.  The fact is that the present usually hurts. We thrust it out of sight because it distresses us, and if we find it enjoyable, we are sorry to see it slip away.  We try to give it the support of the future, and think how were going to arrange things over which we have no control for a time we can never be sure of reaching. Let each of us examine his thoughts; he will find them with the past o the future.  The present is never our end.  The past and the present are our means, the future alone our end.  Thus we never actually live but hope to live, and since we are always planning how to be happy, it is inevitable that we should never be so.” Pensées Blaise Pascal  If King David spoke English, he would have said "This is the day which the LORD hath made; we will rejoice and be glad in it", Ps 118:24.  Or in the source document that Pascal would have read C'est ici la journée que l'Éternel a faite: Qu'elle soit pour nous un sujet d'allégresse et de joie! Psaume 118:24.  In a simpler language, my wife says, “Have a glass of īczed tea or Avez-un verre de thé glacé.

SPIRITUAL SIDE OF RETIREMENT

Man cannot live on retirement checks and annuities alone.

A holistic approach to retirement would include the body, soul and spirit with the soul being defined as the mind, will and emotions.    I have addressed the financial, physical and activity aspects of retirement.

Alpha

In reading this section, don’t be surprised to see spiritual answers to spiritual questions.   Just keep an opened mind. 

“The first few months of retirement can be difficult particularly for people who didn't have an excellent work/life balance in the their careers.   Suddenly all those hours that used to be taken up by work are open for leisure activity.   For some people, this is a frightening and challenging situation.  Getting used to freedom and having to make their own decisions on what sort of activities to pursue can tax uncreative minds.   For that matter, it can tax a few creative ones.”  How to Retire Happy, Wild and Free by Ernie Zelinski page 38.

What thing or project will provide lasting fulfillment?    When one gets to the point of realizing that the pursuit of a new thing or project is to meet an inner need, one looks inside of his or her self for meaning and purpose.   In being alone, one becomes aware of aloneness, not necessarily loneliness, and becomes discouraged or bored.   As David Jeremiah puts it in Slaying the Giants in Your Life page 34, discouragement “sends us inward where pity parties and are common and perspective is rare.”

The creation of a retired identity or new life is the spiritual side of retirement.   Rather than trying to make something new out of something old, why not turn to the creator who says “ I make all things new”, II Cor 5:17, and His promise is in His Son.   His Son says, “I am come that they might have life and that they might have it more abundantly.”   John 10:10.  That word life in Greek is ZOE from which we get the English word ZOO and ZOOLOGY.    Beyond biology, in this case, ZOE means “life as God has it”,  An Expository of New Testament Words by W.E. Vine.

How do I apply this to my retirement?   “But as for me and my house, we will serve the Lord”  Jos 24:15

More information on this subject can be found at

The Hope Project  with the conclusion at The Hope Project Conclusion

This is not about religion. Religion makes one a judge but a relationship makes one a son. Rom 8:15, Gal 4:6

With this, now dreams can provide purpose, meaning and fulfillment rather than just something to ward off boredom and loneliness.

DREAMS

These retirement notes were written within my first three months of retirement.  They captured the transition from "What you do" to "who you are".  For those of you who are presently retired, do you remember this transition?  I have seen many of my peers return to work as contractors due to boredom.  We re-invent ourselves through dreams.  Even before I retired, my financial advisor told me to determine my retirement dreams.  I made a short list.  I also did some research. I recommend the following books:

I spent a couple of years determining my dreams.  I can’t camp or cruise everyday.  I don’t want to waste away my remaining years waiting for the next camping trip or cruise.   As my wife from the deep south says (any further south is wet feet) “Have a glass of īczed tea.”   To the rest of us, carpe diem. Seize the moment, enjoy everyday.   The first step in developing a dream list is to minimize, eliminate television except for NCIS.  What is the value of watching other people enjoy life when you can enjoy it yourself.  Those who spend their retirement watching TV, die shortly from boredom. Learn to enjoy everyday while you are still working.  Practice retirement while you still have the time. 

Here is my list of dream as of this writing:

RETIREMENT DREAMS
1
Floss
2
Take Drawing Classes Dream 2  Retirement Arts
3
Take Painting Classes
4
Take a Priscilla Coote art class in Key west
5
A+ Certification
6
Take HTML Classes  Retirement Arts
7
Take Dreamweaver Classes Retirement Arts
8
Develop a web site
9
Go back to photography as a hobby
10
Take Digital Photography Class
11
Teach Internet Class to Senior Citizens
12
Teach Sunday School Class
13
Take Italian Cooking Class
14
Take French Cooking Class Retirement Arts
15
Learn to Grill and Take a Grilling Class Recipes  Retirement Arts
16
Work a season at a KOA in the Keys
17
Work as a greeter for Disney
18
Work as a greeter for Royal Caribbean
19
Photograph and paint camping trips and cruises Dream 19
20
Learn to Sail
21
Take more cruises
22
Garden
23
Buy a house with a pool in Florida Dream 23
24
Learn to sail a Catamaran and sail regularly
25
Take more culinary classes
26
Go on a foreign missions trip
27
Write a book
28
Return to SCUBA Diving (NAUI Rescue Certified) Dream 28
29
Continue work on the family tree
30
Create web site for my wife Spanish Moss
31
Add tax considerations to retirement page
32
Visit DisneyWorld at Christmas Christmas at Fort Wilderness
33
Learn to draw in color Dream 33  Retirement Arts
34
Add to Dream List
35
Take Caribbean Cooking Class Dream 35  Retirement Arts
36
Learn Spanish
37
Learn French
38
Add Animation to this website Dreamweaver Pro Image Show
39
Go Deep Sea Fishing again
40
Go Back to Cross Harp (harmonica)
41
Bike a centurion
42
Deep sea fish with my brother
43
Deep sea fish out of Islamorada
44
Take a portait drawing class
45
Obtain Basic Boating Certification
46
Obtain Sail Certification
47
Read The Rise and Fall of the Roman Empire
48
Visit Tahiti Dream 48
49
Paint The South Pacific Dream 49
50
Work Part Time as a Web Designer
51
Memorize 25 scriptures with reference that apply to my Retired Life
52
Attend Culinary Institute of Tuscany
53
Take An Oil Painting Class Retirement Arts
54
Obtain Motorcycle License COMPLETED NOV 7, 2010
55
Cruise A1A on a Motorcycle Dream 55
56
Create A Tropical Garden Dream 56
57
58
Create an after 5 years webpage Dream 58
59
Sail on Disney Cruise Line
60
Build A desk for My Office
61
Visit Hawaii again  Dream 61
62
Tour Kauai on a motorcycle
63
Create an after 10 years webpage Dream 63
64
European River Cruise

You are never too old to set another goal or to dream a new dream

C.S. Lewis

Living The Dream

ONE YEAR LATER

When I first created this webpage, my intent was to journalize the transition from working stiff to retirement.  I was aware of those who had made the last day of work the goal rather than retirement itself.  Some returned to work, some died of boredom and some spent the nest egg on poor health due to bodily neglect.  It is like comparing the wedding day to a marriage.  Keep adding to your dream list.  As my wife said, “Have a glass of iczed tea”. 

That is not an easy task for an engineer or anyone who has a scientific viewpoint.  Science is based on observation and repeatability.   To step back, observe and analyze retirement is to lose it.  As C.S. Lewis puts it “You cannot hope and also think about hoping at the same moment; for in hope we look to hope’s object and we interrupt this by (so to speak) turning round to look at hope itself.”… “The surest way of spoiling a pleasure was to start examining your satisfaction”… “In introspection we try to look ‘inside ourselves’ and see what is going on.  But nearly everything that was going on a moment before is stopped by the very act of our turning to look at it.”

Similarly, professor, song writer, author and management consultant, Robert Waller makes the same analogy about romance.  “Romance dances just beyond the firelight, in the corner of your eye.  She does not like you to look at her directly; she flees from the cold light of logic and data collection when it is turned toward her.  If you persist in trying to study her, however, she first disintegrates, then dissolves into nothing at all.”

Over the past 17 years, the water pressure regulator in our house slowed the flow to a point where if the washing machine was running, there was no water pressure to any other appliance or faucet.  It happened so gradually that I did not notice it until the frog had been boiled to death.  It was recently replaced.  Now I can fill the washing machine, flush two toilets and take a shower at the same time.  I rejoice every time that I take a shower.  I do not lose this simple joy by thinking that I should have replaced it 17 years ago.   Nor do I lose the joy of retirement by stepping back to analyze or second guess it.  To say “should have” is to lose your joy.  So enjoy your īczed tea without analysis.  Don’t look at it, drink it!

 

Surprised by Joy, C.S. Lewis, page 218-219, Harcourt, Brace & World, Inc. New York ©1955 C. S. Lewis

Just Beyond the Firelight, Robert James Waller, page 55, Iowa State University Press/Ames, ©1988 Iowa State University Press, Ames Iowa 50010

SANITY CHECK

This Sanity Check is subjective and is based on what I have researched and what I have applied to my retirement strategy.

One year into retirement, I decided to read Preparing for Retirement by Larry Burkett.  It is intended for those planning retirement and for the newly retired.

Be forewarned that is based on the timeless wisdom for King Solomon of Israel, 960BC- 925 BC and is most appreciated after the reinvention of the retiree and the spiritual side of retirement is embraced on this webpage.
How blessed is the man who finds wisdom, and the man who gains understanding.  For its profit is better than the profit of silver and its gain than fine gold.”  Proverbs 3:13-15. Preparing for Retirement, page 16.

By wisdom a house is built, and by understanding it is established;  and by knowledge the rooms are filled with all precious and pleasant riches.”  Proverbs 24:3-4.  Preparing for Retirement, page 178.

When I first open the book, it opened to page 132.  “Take at least a year after retiring before you make any relocation decisions”.  The book grabbed my attention.  Notice that it says before making any decisions and not before relocating.  Item 23 of my dream list is to move to Florida.

Larry Burkett also says that task oriented Type A personalities like myself should not retire unless retirement can be redirected to new projects.  Hence, the value of the dream list for me.  Pleasure seeking and consumption will be short lived, my insight.

The investment advice is conservative which I believe is wise.  In my case, at this time, I have no new income and I have less economic life ahead of me to recover from severe risk than when I was younger.

When I was younger, my most expensive commodity was time.  Now I have time and the time value of money has decreased.  In other words, if one is in good health, mow the lawn yourself and shovel the snow yourself.  The benefits are

  • Less cost
  • Exercise
  • Do you it your way
  • Time to think, mental space, problem solve, contemplate, meditate and pray while doing physical work.

For the past 26 years, my wife has done an excellent job managing the household internal budget.  She essentially does not spend what she does not have and partners with friends for wholesale purchases.  To encourage her and to reiterate what she has been doing, I recommended that she read Larry Burkett’s Preparing for Retirement, “Retiree’s Budget” chapter pages 229 to 243.

 

To reiterate, I would not budget Social Security as part of one’s budget.  This is especially true if you are not presently collecting Social Security.  http://www.hhs.gov/news/press/pre1995pres/910517.txt

My next retirement milestone is age 65.  I don’t want to lose the taste of today’s īczed tea by focusing on checkout group thinking but there are considerations to made with strategic thinking.  Some considerations are medical expenses, medigap insurance, retirement service availability, state inheritance taxes and opportunities to volunteer.

 

MEDICARE

I received my Medicare Part A & Part B card in the mail 134 days prior to my 65th birthday.   As long as one is receiving Social Security, the process is automatic.  See the updates listed below.

This is preliminary information. 

Medicare is broken into four parts

Part A   Hospital Coverage
Part B   Medicare Insurance
Part C   Medical Advantage
Part D   Prescription Drug Plans

More information can be found at   http://www.medicare.gov/navigation/medicare-basics/medicare-benefits/medicare-benefits-overview.aspx

Coordinate this with your employer’s health plans.  In my case, my former employer will provide their Part D and a supplemental medical package.   I will update this site when I learn more about my employer’s supplemental plan.  If your company does not provide this coverage, consider a Medigap policy.  http://www.medicare.gov/find-a-plan/questions/medigap-home.aspx

In the month in which my Medicare subscription became effective, $99.90 was subtracted from my Social Security check to pay for my Medicare Part B premium.

The schedule for Part B premiums can be found at Medicare Part B Premiums  

The Part B deductible is $140.

2013 SOCIAL SECURITY AND MEDICARE UPDATES

This page is a living document.  Therefore I will present the changes in the form of updates rather than changing the historical data.

Higher payroll tax cap. The payroll tax cap increased by $3,600, from $110,100 in 2012 to $113,700 in 2013.  Workers who earn more than this threshold don't need to pay Social Security taxes on that income.

Higher earnings limit.  People between ages 62 and 66 who work and collect Social Security benefits at the same time might have part or all of their Social Security benefit temporarily withheld.  Workers between ages 62 and 65 can earn up to $15,120 in 2013, after which $1 in benefits will be withheld for every $2 of income above the earnings limit.  People who turn 66 this year can earn up to $40,080, and then $1 of benefits will be withheld for every $3 earned above the limit.  However, once you turn age 66, the earnings limit no longer applies.  And benefits may be recalculated at age 66 to reflect the withheld benefits and continued earnings. 

The Part B Medicare deductible increased to $147.00 in 2013 and my Medicare subscription increased to $104.90 which is subtracted from my Social Security check to pay for my Medicare Part B premium.  

2014 MEDICARE UPDATES

Medicare Deductibles and Premiums did not change from 2013 to 2014.  The Part B Medicare deductible did not increase from $147.00 in 2014 and my Medicare subscription did not increase from $104.90 in 2014 which is subtracted from my Social Security check to pay for my Medicare Part B premium.  

 



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