Bitter taste of reality.................Boomers rethink retirement
Many in that generation face unexpected lost investments
Jim and Ann Jinks, stung by the stock market, are reluctantly postponing retirement. NBC's Chip Reid reports.
By Chip Reid
NBC NEWS
March 19 — What happens if you wake up one day and realize that your retirement plans are inadequate? Many approaching what they thought would be their retirement years are having to rethink their plans after significant losses in the economic downturn. Some are even redefining what it means to be retired.
JIM AND ANN Jinks had a plan. For years they invested carefully, and even with two college-bound children, they thought they were saving enough money to make early retirement a sure thing.
“I really hoped to retire at about 58 or 59,” says Jim.
But that was before Jim, a 52-year-old anesthetist, and Ann, a 40-year-old nurse, saw one-third of their portfolio disappear in the stock market over the past two years
“Our goals of having a second home, travelling, wanting to enjoy our time while we’re healthy, enjoying our family, is all very important to us, but who knows when we’re going to reach that point?” says Ann.
Jim now expects that retirement has been pushed back at least three or four years.
Money manager Dennis Hinton says that postponing retirement because of stock market losses is a harsh reality that much of the baby-boom generation is now facing.
“What I’m finding is if clients were due to retire in their late 50s they’re realistically now looking at 65, 66 years old before they can comfortably financially retire,” says Hinton, who works at Resource Securities Corp.
He gives the standard advice: reduce expenses, invest more money — especially in 401(k) plans — and diversify your portfolio. But he also admonishes baby-boomers to face the fact that early retirement will have to be delayed.
Many baby-boomers today are not just thinking about postponing retirement, they’re actually redefining it. To their parents retirement meant quitting work completely. Now it often means continuing to work, but just working less.
According to this year’s Retirement Confidence Survey, conducted by three respected economic research groups, 24 percent of today’s retirees work part-time. But that number may soon explode, because a stunning 66 percent of today’s workers expect to be working part-time after they retire.
“You’d probably catch me going to work, maybe working one month and being off a month,” says Jim. “If that’s a form of retirement so be it.”
Today’s baby-boomers, stung by the stock market, giving new meaning to the word retirement. |
