This piece from CIO.com is a nice reality check and the general principles apply to everyone, not just IT people. Retire? How About Never?
Overall, the recession has had far more of an economic impact on late-middle-aged adults. In an April Pew Research Center study of 2,969 adults aged 50 to 64, nearly 75% said the nation's economic problems are making it difficult to afford retirement.
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Nearly two-thirds of those surveyed in that age bracket said their 401(k) accounts or individual stocks have been clobbered, with two in 10 claiming that their investments have lost 40% of their value and another four in 10 saying nearly 20% to 40% of their retirement funds have been erased.
I have never believed that I would be able to retire, not just because I could not save enough to do so, but because I have known half my life that when the moment came to kick back I would be doing it with millions of other boomers whose removal from the "productive" economy would shrink that economy and make it too small to support us.
I've also been pretty much convinced that rule number one of investing is "never give your money to someone else to play with on your behalf, never, ever, no, I really mean it, never"
So I have paid off my mortgage and I'm building an urban homestead where we are aiming to be able to live, not just survive, on about $200 a week in current dollars.
While most of the rest of my peers have spent their lives trying to get rich enough to retire, I've spent mine learning to live poor.
My wife is a teacher on a 4 year contract and she has 2 years to go. Here's how I rate that contract.
- Chances of it being renewed on similar terms - 20%
- Chances of being significantly cut on renewal - 40%
- Chances of not being renewed 20%
- Chances of being bought out before the end 20%
- Chances of surviving any of those otucomes, pretty good.
- 56 year old family member on contract for a company that provides training to large insurance and financial companies. Unpaid for several months, yesterday asked me for a loan to get through Christmas
- 58 year old CFO for several medium sized north American companies. Laid off in march, 10 months on global search for new job. Nothing
- 58 year old former exec and successful business man. Lost his company 3 years ago, still no job and about to run out of money
Economic recovery? Not close.
This thing hasn't even cleared its throat yet and as the CIO peives goes on to say, "there is no place to hide in this economy"