During my online chat last week, a number of comments centered on retirement, including a concern from a senior feeling like a failure for collecting retirement early.
I am falling
Q: I am 63 years old. I have worked most of my life in not-for-profit as a fundraiser. In the past five years, I have been out of work for a total of 22 months. I have drawn on my retirement to stay alive during those times, but I lost my home as a result of this — a home I lived in for 25 years. I feel lost and abandoned. I am looking for work now, but I am losing heart. I will start working part-time at a garden center next week. Any ideas?
A: May is Older Americans Month, and in honor of that, the Census Bureau released some facts about seniors. This reader is not alone in having a sinking feeling about his or her finances.
The supplemental poverty rate for those 65 or older in 2015 was 13.7 percent, or 6.5 million people. If Social Security was excluded from income, it would more than triple the poverty rate for this group, according to the Census Bureau.
Nearly half a million older adults ages 55 to 64 and 168,000 adults age 65 or older who wanted to work were unemployed 27 weeks or longer in 2014, the National Council on Aging points out.
If you need to tap your retirement funds early or apply for Social Security at 62, or before your full retirement age, or even at 70, that’s okay. Yes, ideally, waiting will net you more money every month, but if your circumstances are such that you can’t wait, do what’s needed to provide for yourself. And please don’t feel like a failure. Life happens.
Here are some resources to help if you’re a senior and struggling:
— Benefitscheckup.org, a service by the National Council on Aging that matches seniors in need with benefits programs.
Renting vs. owning in retirement
Comment: Based on last week’s retirement newsletter, I propose a sixth question to help narrow things down: How much “stuff” do you feel is necessary? For a lot of folks, a simple lifestyle provides contentment, and all stuff does is serve as something to worry about — and a house can be the ultimate worrisome object.
For me, although I’m years away from retirement, I’m already thinking about downsizing. And as frugal as I am, I still have too much stuff. If you’re wondering if you should downsize, read these articles:
Extra payments on mortgage principal
Reader comment: Michelle, just wanted to share with you that your mantra of “all debt is bondage” has finally gotten through to my husband. He’s always said that our (very good) 15-year mortgage interest rate of 2.5 percent was essentially free money. Although we’re pretty comfortable, I worry about closing in on retirement with that debt still outstanding. After many comments from me starting with “Michelle says…” I finally showed him an amortization calculator. We’re going to shave three years and thousands in interest off that debt by sending an extra $600 per month. I’m sleeping a bit better because of it!
I’m in the club of don’t drag a mortgage into retirement.
If you want to know how much to pay extra to retire your mortgage early, use this calculator by Bankrate.com.
One of the top financial goals for me and my husband is to pay off our mortgage before we retire.
I want to hear from you. Do you believe it’s best to pay off your mortgage before you retire? Send your comments to firstname.lastname@example.org.
Retirement rants & raves
In this feature your voice matters. This is a space in which you can rave or rant about anything related to retirement. So what’s on your mine about your retirement or your planning for retirement (I would especially love to hear from young adults)?
Send your comments to email@example.com. Please include your name, city and state. In the subject line, put “Retirement Rants & Raves.”
Mary Smart of Winter Park, Fla., wanted to rant about the new administration. She wrote, “My husband and I are retired with Social Security, state pensions and a paid-off mortgage and cars, giving us a comfortable, though not luxurious, life. We are grateful to be in this position, and my concern is our daughter — in her 40s, single, with a decent but not high-paying office job. The policies of the GOP and Trump threaten her future — health care, Medicare, Social Security — which worries me deeply. She owns her home, with a mortgage, has some savings, but doesn’t make enough to save a lot. After doing things right for us all our lives, thanks to millionaire congressmen, I fear that we need to save all our retirement savings for her, because they’re shredding the social contract we’ve relied on all my life. What can anyone do to help their children when the future in this country for the not-wealthy looks so bleak?”
What would you tell Mary?
Live chat this week
Join me on Thurs. May 4 at noon (ET) for a live discussion about your retirement.
My guest will be Michael Edesess, an economist, mathematician and chief strategist of Compendium Finance. He is one of the co-authors of “The 3 Simple Rules of Investing: Why Everything You’ve Heard about Investing Is Wrong — and What to Do Instead” and author of “The Big Investment Lie.”
Edesess will be available to take your retirement questions.
Click this link to participate in the discussion.
Newsletter Comments Policy
Please note that it is my personal policy to identify readers who respond to questions I ask in my newsletters. I find it encourages thoughtful and civil conversation. I want my newsletters to be a safe place to express your opinion. On sensitive matters or upon request, I’m happy to include just your first name and/or last initial. But I prefer not to post anonymous comments (I do make exceptions when I’m asking questions that might reveal sensitive information or cause conflict.)
Have a question about your finances? Michelle Singletary has a weekly live chat every Thursday at noon where she discusses financial dilemmas with readers. You can also write to Michelle directly by sending an email to firstname.lastname@example.org. Personal responses may not be possible, and comments or questions may be used in a future column, with the writer’s name, unless otherwise requested. To read more Color of Money columns, go here.