Retirement Inequality

After spending several weeks down in Florida, I’ve had the chance to observe many different stages of retirement styles. It’s quite apparent that there are different shades of living arrangements whether self imposed or happenstance. Retirement inequality, however is alive and well.  We have the luxury condos or townhomes where the rich and successful retirement planners dwell. And we have the less than desirable neighborhoods where, for whatever reason, retirement planning just didn’t go as well.

Sarasota has a growing homeless population as does most of the United States.  I think the saddest sight to see is the elderly living and begging on the streets.  Over the weekend, my sister and I met our brother in downtown Sarasota for dinner. As my sister and I got out of her Mercedes Benz convertible, we were approached by a rather sad looking woman asking if we had any money to spare. My sister said she had no cash, only charge cards (which was a silly thing to say). Me? I can’t bear to see a woman, especially one in her 50’s suffer. I told her yes, I had some money. As I approached her I could see that she had all of her clothes about her, bundled up and stuffed into bags. She was very distressed, almost on the verge of tears.

I told her I understood. I told her I know what she was going through. I told her I didn’t have much cash. But whatever I had, I would share it with her. I had a $20 bill and a $10 bill.  I asked her if $10 was alright.  It was and with that we both wished each other to have a good night. I went on to have a lovely $50 dinner with my brother (I put it on my charge card). The woman on the bench was still there when we got back to the car.

We can’t  be mean to people such as this woman. We can’t blame them for what happened to them. We can’t shrug and say she should have planned her retirement better.  Things happen. Many older workers today are being pushed out of their jobs simply because they are in their 50s or early 60s.  None of this was in their retirement planning.  Ditto to the many folks who have been renters for years only to find their rents doubled and tripled thanks in part to the greedy builders who will only build luxury condos and townhomes.

I’ll be honest with you and tell you a little secret. When I had my Florida condo I was astounded at how fast the taxes and HOA fees were rising. It didn’t take me long to calculate that that rising rate and our fixed incomes weren’t going to suffice for very long.  That second hand smoke was probably a gift from God. It compelled me to sell and get the heck out of there while still financially intact. The other day I was feeling a little bit sad and nostalgic for what happened to me until I met this homeless woman. It doesn’t take much anymore to find yourself out on the street. DH lost his job in his 50s. He’s just been lucky he keeps finding day work here and there. And he’s also lucky that we didn’t fall prey to lifestyle inflation. Somehow I managed to keep everything the same. Lucky us.

Forced early retirement means a downgrade in lifestyle. It means living low to the ground. When we’re a bit broker than we expected, stripping down to the basics can finally show us who we truly are. We do what we have to do to survive. The world doesn’t come to an end just because we have to take it easy. DH and I can’t afford things like we used to but we’re finding the substitutes work just as well.  State Parks can be just as fine as privately owned RV parks or national chains. Reclaimed products can work equally well as the newer stuff. We have to master the art of “patience”.  Something we used to know nothing about  and I have to learn to say the word “no” more often than I’d like.  To a former shopaholic, it’s been very difficult! But I’m doing it.

For the first time in like forever, when my older brother invited my sister and I to meet him for dinner, Kathy and I paid for our own meals!  My brother breathed a sigh of relief. Kathy’s bill came to $28.  I had to have a cocktail and a cappuccino in addition to my entree (same as Kathy’s).  My bill came to $50. Kathy goes out to dinner often.  Me? Rarely. She has the Mercedes. I had the money to help another.

22A0F55D-9330-48F7-B54A-70F8C544057A
This was my $50 meal  with cocktail, cappuccino and tip.  Amazing!

 

 

Advertisements

33 comments

    • It certainly is keeping things in perspective for me. Which I relay to hubby. But for the grace of God go I. Thank you for your comment.

      Like

    • I think I am going to volunteer in a local food pantry in our town run by the church. There are a lot of retirees in my town and I am certain they need help. I’ll keep you posted! It’s a sore spot for me.

      Liked by 1 person

      • It is a wonderful place to fill a need……….so many people in our small community are in desperate need of food so to see your money and work going towards making someone’s life better makes one’s heart sing.

        Liked by 1 person

  1. I’ve worked on and off in our church’s food pantry for two years. We provided a week of food for 4,000 people last year. Mostly the working poor, there are a few elderly whom we provide for monthly. It is a cause close to my heart. Even if you decide not to actually “do” the stocking or packing, a weekly offering of 6 cartons of eggs is greatly helpful. It will set you back about $20 a month and provide solid protein for people who need it.
    Every bit helps. Thank you for taking the time to care.

    Like

    • JanBo. I eat a lot of eggs. It’s the perfect food. Full of protein. Your suggestion is a wonderful one. Eggs at our local Aldi are very inexpensive. I can afford to pick up 6 dozen and help others. Thank you for a great idea!!

      Like

  2. We did our income taxes today. It came as a rather unpleasant surprise that last year 54% of our Social Security was taxable and this year 83% is taxable. It’s sad that while Amazon paid no taxes last year, 70+ year old retirees have to pay increasing taxes on their Social Security. IMHO.

    Like

    • Florence how can social security be taxed? The federal govt is now taxing it? I have to delve into this. I thought only up to full retirement age and over $33k per couple was taxed? An injustice for sure when compared to amazon.

      Like

    • Hi Florence, you mention you are over 70 so I am curious if the increase was due to now having to take Required Minimum Districutions from tax deferred IRA and 401k? Which definitely helps makes more Social Security taxable. It’s called the tax torpedo by financial planners. I started Roth Conversions in my 50s and now do more with the new tax law to have a stream of tax free income to draw on to pay the added taxes when I am hit with the RMDS. 85% of my SS is taxable probably for the rest of my life. It definitely sucks that corporate America pays zero taxes and the government heavily taxes the elderly SS.They also garner the student loans owed from Social Security if you defaulted this has been growing with interest and penalties tacked on. Lara

      Like

      • Sometimes Lara I’m glad to be in the lower income category. It really doesn’t pay anymore to earn money. True socialism in its infantile form. Sad.

        Like

      • Having Lower taxable income definitely helps with getting lower health premiums under Obamacare for early retirees before Medicare and Social Security kicks in. I know you have to keep your income low to qualify for Nick’s $20 monthly premium for New York State health insurance program till he reaches Medicare age in a few years. You are in a rock and a hard place juggling expenses while not tapping too much savings and yet wanting to enjoy the freedom of both being retired. I hope for your sake the housing prices don’t crash like in 2008 before you can pull off selling with the nice capital gains you are anticipating.
        I didn’t know Mr Money Mustache was divorce since I hadn’t really kept up with his blog. I enjoyed reading him years ago but since I live in a very mountainous area biking was never my mode of transportation. I find him too preachy and a lot of the FIRE bloggers lifestyle inflation has become business expenses match to their blog income to promote thiis side hustle. So they are not really living frugally any longer. Lara

        Like

      • We don’t have Obamacare anymore in NY. It’s a whole new concept under New York State. NY refused to insure hubby under Obamacare three years ago and forced him off the policy. Plus two health insurance companies that hubby was on under Obamacare when first introduced went bankrupt. Hubby got an email from NY and told him his coverage was being cancelled and he was literally forced to go under the new, independent NY health plan. So really Lara, my husband had no choice. A recent review of current health plans are $489 a month for individual with a $4000 deductible and then they will only cover 50% of all future claims, doctor visits, hospital, lab work and RX. Why would a person work then? All his future income plus some of mine would go to pay for his healthcare? Why work if all your money was to be taken away? Plus he really wouldn’t have such great health coverage to begin with anyway?
        I don’t make the rules and the laws.
        I just follow them.
        The way our new lives are being shaped screams socialism loud and clear. I have no idea how NY state is going to pay for all of this since so many rich people are fleeing.
        As to my home, it has become apparent that there is no place else better than what we already have. Who knew? We’re not moving and we’re not tapping into any equity as of yet. We may need it for assisted living or nursing home care. NY will gladly take our home away for that. We have no intention of leaving our kids anything. For apparent reasons. My youngest did suggest may be she’d Buy it and let us continue to live there, but we’ll see. We’re not depending on her.
        As to Mr MNM and all those other early retiree bullsh**ers, they’re quickly finding out their nonsense just doesn’t work. And neither do they.
        Divorced because they think it’s frugal to have only one or none child is preposterous. Putting a price tag on a child is sacrilegious IMHO. MMMs ex-wife ran for the hills. Good for her!

        Like

      • PS: here’s the question. What would you or anyone else do? If you work and earn $50k a year, half of it would be taken away to pay for your health care. Or work and earn $25k and get free health care? You’re still living the same lifestyle but with the latter you’re working less and enjoying life more. Which one would anyone choose? That’s the socialist question.

        Like

    • The gross amount per couple is as I suspected $34k. There are no NY taxes on social security up to a certain level. No worries for me because we don’t earn that much. I guess that’s good news. We don’t get any tax refund but neither do we pay. Zero on both ends for us.
      But that’s still amazing about your increase and comparison to amazon.
      Thanks for the info.

      Like

    • Thank you Florence, for bringing this to my attention as well. I had no idea. Not a great surprise for all those not expecting it. It will be one more thing for me to consider before my husband and I take the leap into retirement.

      Liked by 1 person

  3. Cindi, what a generous thing to do. Not about the money, but caring enough to speak to her that you understand. That was probably worth more than the money.

    On a side note, you should try to duplicate that meal at home! Oh my gosh it looks delicious! I would be curious how much it would actually cost.

    Like

    • Sharon but for the grace of God go I.
      The recipe I duplicate with thin sliced chicken cutlets. I’ve never seen it done with salmon. I’ll give it a try.
      Thx for your comment.

      Like

  4. So if Nick plan is being cancelled is the $479 a month plan what he has as his option instead of $20 for the low income plan? If so will he start SS. Earlier to pay the premiums? Federal Entitlements (Social Security) have been around since 1935 and the WPA was also a socialistic work program. The 1960s saw a huge increase in socialist programs while we pooh poohed USSR communism. I saw in the 1970s a huge population of people selecting impoverished wages tocovered their families with free medical coverage, food stamps, and other government hand outs. It is not a new thing but the internet has taught more people how to work the system and e- begging.
    A paid off house where there is no HOA and elderly property tax relief if you qualify is probably the best way to go. Or perhaps the RV life in the Northeast and park it at your daughters and rent A place for a warmer location for the winter months. IMHO Lara

    Like

    • Yes. And he will take social security then knowing the full amount will go towards medical care till Medicare. It doesn’t matter how much Money you have in the bank or in retirement funds. Income is all that matters.

      Like

    • Lots of early retirees are in the same boat. They’re forced to keep their income low in order to qualify for subsidies before reaching Medicare. Hopefully one day there will be a better solution. But in the interim people do whatever it must take to make life tolerable and have ends meet.

      Like

      • What do you mean by Your statement “it doesn’t matter how much money you have in the bank or in retirement funds. Income is the only thing that matters. The money you saved adds a passive stream of income and can be used to supplement your pensions and SS. Those who do not have any savings would love to have some when they stop working. Lara

        Like

      • When applying for some benefits, they don’t care how much money you have in the bank or in retirement accounts. Approval is based on income.

        Like

  5. This looking at just income also is the way they determine how large of a mortgage you qualify for too.

    So is it fair for those who could pay for themselves out of their own savings to use methods to manipulate their income to qualify for programs meant to help those who truly are poor? IMHO, In the end we are creating massive debt and the cost has to come out of taxes and we are saddling our children and grandchildren with this burden. Lara

    Like

    • Lara my husband argued with NYS. He told them he was paying his bills. They didn’t care. They kicked him off and wouldn’t sell him the insurance he had for 2 years. As I said. I don’t make the rules nor do I make the laws. I just follow them. Looks like to me the government wants you on their plans. Go figure.

      Like

    • Lara, I think you’re confusing this with welfare. This is not welfare. NYS canceled Obamacare and replaced it with their own statewide health insurance. It’s only available to NY working residents and it’s based on your earned income. If a resident Isnt earning enough income, they put you on in medicade. In other words NYS offers ALL its residents some version of healthcare. They do this to have people come and remain in the state and it’s kinda working.

      Like

      • I understand your thinking. To be realistic Nick can qualify for disability because of his crippling heart condition but he refuses. He’d rather that money go to someone who truly needs it. Ditto for food stamps. We qualify but would never take it because there are so many others worse off than us.
        The state doesn’t want people to drain off their savings because eventually they’ll be broke poor and destitute. When that happens they go on welfare and Medicaid and waste millions of taxpayers money. By offering affordable health care options to the working man woman and family, who do not get coverage through their jobs they are keeping people solvent and off the dole.
        I think it’s a brilliant idea.

        Like

  6. If Nick condition qualified him for disabilitywhich is higher then taking early SS, then he should take it he paid into the SS and Medicare all his working life and this is what the safety net is for. I am not sure how NY food stamps work and if there they look at your assets. I have no problem with those actually disabled using the entitlement programs my problems is those that game their finances to have others contrtibute to their expenses through programs provided by taxes others pay. Lara

    Like

    • You have to hire an attorney to get disability. Takes a year. Then attorney gets cut from settlement. No thanks.
      NYS changed Nicks health insurance due to his documented drop in income. It is what it is. Nobody here is trying to beat any system. Between my social security, pension,interest and dividends from investments and hubbys reduced salary our gross income makes us the new working poor. As I said, it is what it is. What we have in retirement accounts or assets are meaningless. Without substantial income we couldn’t even borrow money from a bank let alone a Shylock. As I will say for the last time: I don’t make the laws nor the rules. I just follow them. When you hit a bump in the road thankfully our local and federal government is there to help you. If you abuse the system, it’s all a matter of time before it catches up with you.

      Like

  7. I can only speak from my own experience in 2005-2006 with DH leukemia and the NYCRailroad board office with no lawyer involve and a very helpful representative. He expedited the application. Disability started six months after diagnosis. My niece use the legal aid society in California for her husband Social Security disability application. Nothing was given over to legal fees. Lara

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.