Sixty-somethings: A Look at Two Families' Financial Approaches

By Clifton Linton
Senior Writer, mPower

Here's a look at how two families manage to keep on an even financial keel as they deal with retirement issues.

While their stories are unique, the issues they grapple with are common for many folks in their 60s.

Al DeAgazio: Keeping A Weather Eye on His Pennies

"I imagined retirement would be kicking back and reading, doing a lot of sailing, and playing around," he said.

Instead of boating in his retirement, he's embarked upon a second "career," if that's what you want to call it, as a volunteer handyman. He's fixing up his house, his in-laws' house, and his friends' houses. He's not working for money though.

His retirement plans changed in the last two years, as his wife died and he recently decided to move away from the hustle and bustle of the large mid-Atlantic city he currently calls home.

But, the forethought he put into his retirement planning gave him the flexibility to easily change his plans.

When it comes to financial planning and money habits, he's self taught. He describes himself as a tight-fisted New Englander. This characteristic was a leading reason he built a several-million-dollar retirement portfolio. He abhors debt. "I don't like to pay interest. I like to collect interest," Al said.

He also benefited from the stock market boom of the 1980s and 1990s. Again, he taught himself the ins and outs of stock trading. He quickly learned to avoid the glam stocks. "Go for the steady things," he said. "Buy a good, solid company and just hang in there."

Still he hasn't been immune to recent market turmoil, "when you have a general decline, you feel like you are bleeding to death," he added.

Regardless, he believes a diversified-stock portfolio is the way to go.

Further, he's got an ace-in-the-hole to ensure he has a comfortable retirement. The 401(k) and 403(b) plans that he opened at former employers are still compounding interest. To date, he's been able to live off of his government pension and Social Security benefits.

Still, he yearns to get back on the water. How will he manage it? "I'll probably go back to work. That's the only way you can seem to go sailing," he said.

Margaret Phillips: A Modest Lifestyle Funds Her Passions

Margaret Phillips, 61, will likely be one of those retirees that reminds you of the Energizer Bunny. She just keeps going and going.

Four years away from retiring from her job as a nurse practitioner in a neonatal care unit, Phillips would like to take a tour of Australia or New Zealand when she retires. She'd also like to become a docent at a local art museum or perhaps go back to college to learn about anthropology.

Will she make it? Quite likely. She and her husband, Bob, live a fairly modest lifestyle. They own a townhouse and drive older-model cars, and have faithfully saved in their IRAs and 401(k) plans. Bob, a government worker in his late 50s, also has a pension coming when he retires. But, that might not be for many years.

"His attitude is `why retire?' I think he'll keep working until it's no longer fun," Margaret said.

This strategy has given the pair flexibility as they approach their retirement. Bob's income will allow them to defer tapping those IRAs and 401(k) plans; letting the balances continue to grow.

The pair learned to avoid debt from their parents, who survived the Great Depression. "We feel you pay things off as quickly as you can," she added.

Margaret and Bob also picked up their parents' savings habits. In just 15 years, the pair has built a retirement portfolio, including their house, of a little over $1 million.

"I think that's enough," Margaret said.

The information provided here is intended to help you understand the general issue and does not constitute any tax, investment or legal advice. Consult your financial, tax or legal advisor regarding your own unique situation and your company's benefits representative for rules specific to your plan.

Sixty-somethings: A Look at Two Families' Financial Approaches

By Clifton Linton
Senior Writer, mPower

Here's a look at how two families manage to keep on an even financial keel as they deal with retirement issues.

While their stories are unique, the issues they grapple with are common for many folks in their 60s.

Al DeAgazio: Keeping A Weather Eye on His Pennies

"I imagined retirement would be kicking back and reading, doing a lot of sailing, and playing around," he said.

Instead of boating in his retirement, he's embarked upon a second "career," if that's what you want to call it, as a volunteer handyman. He's fixing up his house, his in-laws' house, and his friends' houses. He's not working for money though.

His retirement plans changed in the last two years, as his wife died and he recently decided to move away from the hustle and bustle of the large mid-Atlantic city he currently calls home.

But, the forethought he put into his retirement planning gave him the flexibility to easily change his plans.

When it comes to financial planning and money habits, he's self taught. He describes himself as a tight-fisted New Englander. This characteristic was a leading reason he built a several-million-dollar retirement portfolio. He abhors debt. "I don't like to pay interest. I like to collect interest," Al said.

He also benefited from the stock market boom of the 1980s and 1990s. Again, he taught himself the ins and outs of stock trading. He quickly learned to avoid the glam stocks. "Go for the steady things," he said. "Buy a good, solid company and just hang in there."

Still he hasn't been immune to recent market turmoil, "when you have a general decline, you feel like you are bleeding to death," he added.

Regardless, he believes a diversified-stock portfolio is the way to go.

Further, he's got an ace-in-the-hole to ensure he has a comfortable retirement. The 401(k) and 403(b) plans that he opened at former employers are still compounding interest. To date, he's been able to live off of his government pension and Social Security benefits.

Still, he yearns to get back on the water. How will he manage it? "I'll probably go back to work. That's the only way you can seem to go sailing," he said.

Margaret Phillips: A Modest Lifestyle Funds Her Passions

Margaret Phillips, 61, will likely be one of those retirees that reminds you of the Energizer Bunny. She just keeps going and going.

Four years away from retiring from her job as a nurse practitioner in a neonatal care unit, Phillips would like to take a tour of Australia or New Zealand when she retires. She'd also like to become a docent at a local art museum or perhaps go back to college to learn about anthropology.

Will she make it? Quite likely. She and her husband, Bob, live a fairly modest lifestyle. They own a townhouse and drive older-model cars, and have faithfully saved in their IRAs and 401(k) plans. Bob, a government worker in his late 50s, also has a pension coming when he retires. But, that might not be for many years.

"His attitude is `why retire?' I think he'll keep working until it's no longer fun," Margaret said.

This strategy has given the pair flexibility as they approach their retirement. Bob's income will allow them to defer tapping those IRAs and 401(k) plans; letting the balances continue to grow.

The pair learned to avoid debt from their parents, who survived the Great Depression. "We feel you pay things off as quickly as you can," she added.

Margaret and Bob also picked up their parents' savings habits. In just 15 years, the pair has built a retirement portfolio, including their house, of a little over $1 million.

"I think that's enough," Margaret said.

The information provided here is intended to help you understand the general issue and does not constitute any tax, investment or legal advice. Consult your financial, tax or legal advisor regarding your own unique situation and your company's benefits representative for rules specific to your plan.