Unfortunately, some of you are experiencing the precise opposite of the Sweet Spot Solution. For many people approaching retirement age, particularly baby boomers, their plans for the next stage of their life have hit a roadblock they never anticipated. Suddenly they realize they are not on their own after all. They’re providing emotional and financial support for their aging parents (and maybe their kids living in the basement), and their retirement dreams seem to be fading further and further into the future. It’s the perfect storm.
Even after the best-laid plans are put into place, surprises will jump out at you. Just as you are about to leap into the new adventure you’ve been dreaming about for years, suddenly Mom or Dad needs your help, your son or daughter hits a rough patch, and you have to put your own plans on hold.
Life is expensive. Raising a family costs a bundle. Tuition, healthcare, and insurance costs are exorbitant, and the prices of food, oil, and gas have gone through the roof. (And the roof probably needs replacing.) That’s not even counting the endless outflow for all the cool clothing, sports equipment, and electronics every kid seems to need. Most parents are so involved in supporting their families and making ends meet that they find it difficult, if not impossible, to save for retirement. And it never gets easier.
Retirement seems so distant, daunting, and complex. Planning means dealing with lawyers, accountants, insurance agents, and financial advisors, which is neither fun nor free. Most people are intimidated and don’t know where to start, so they concentrate on the immediate—getting through their busy lives and allowing time to pass without any serious planning—forgetting that the future is not that far off. In 2019, of the 71.6 million baby boomers, 45 percent had no retirement savings and only 20 percent had set aside $500,000 or more. They don’t know where to turn, so they do nothing, allowing the problem to magnify. Or they make costly mistakes and exacerbate the situation.
You’ve worked for thirty, forty, or fifty years and suddenly now you’re faced with, “What am I retiring to?” It’s like a blank piece of paper, which, for some people, can make them feel very, very nervous; they don’t want to make mistakes. At least when they’re earning a salary, if they blow the paycheck, there’s another one coming right behind it. In retirement, if you make a few irrevocably wrong decisions, it could cost you the retirement you’ve worked all those years to achieve.
