Money in Retirement

For this article, I interviewed three retired ladies who are snowbirds (folks who live somewhere cold and spend winters in warmer states.) Prior to their retirement, one of the ladies had been a school teacher, one a stay-at-home mom, and one a work-at-home mom who worked with her husband in their businesses. Their ages ranged from the late 60's to 90. One is divorced, one is a long-time widow, and one is a fairly recent widow. They each live off a combination of investments, rental income, pensions, and Social Security, although one pointed out that she could get a job if she really needed money.

Here's what they had to say.

What They Wished They Knew Before Retiring

They had a hard time answering this question, but finally came up with a few things they would have done differently. It's worth noting that was probably a hard question for them because they are all in good financial shape. If I'd interviewed someone who wasn't a retiree that could afford to travel to a winter home each year, I might have gotten some different answers.

On working too much:

"I was missing having fun when I was in my 50's because I was too busy putting my kids through college, working at Wal-mart and teaching school full time at the same time. If I had to go back I'd probably try to have a little bit more fun."

On caring too much about what other people thought:

"Before I retired I was more reserved, being afraid to be outspoken. I found out that the older you get, the freer you are with your speech. It's easier to have fun after you retire because if you're young and you start doing some of these stupid things, people look down on you. But as you get older and you retire, you could care less what people think."

On leaving too much of the finances to her husband:

"I wish I'd learned to do a few more things. I wish I'd have paid attention to my husband. He tried to get me to. He kept saying to me, 'You ought to sit down here and do these books, learn how.' But I wouldn't do it. Now I'm learning the hard way."

What People Should Plan For Before Retirement (And Why)

They were a bit clearer on this one. First, things don't always go as planned:

I didn't ever plan on being retired when I was 58, 59. When I quit working I wondered if I could make it, but as soon as my two pensions kicked in at 60 and 62 I was fine, but I was thrifty until then. Besides, I went out on a disability, so I never did drop down to nothing. I always had at least 2/3rds of my salary coming in."

Second, being realistic is important. And -- at least according to me -- being realistic doesn't mean trying to keep up with the Joneses. It means understanding what you can truly afford to do now while planning for the future too.

They can plan for getting older just by not having to have everything Right. This. Minute. Nobody needs two new cars, a brand new $250-$300,000 house when they're in their early twenties, early thirties, early forties. You have to plan on getting older and having the things that you need when you get there -- not live just in the minute, but live for the future.

And this will make doing that a whole lot easier:

Don't get a credit card when you're young. And if you get a credit card, pay it off fully every month. Don't ever, ever, ever allow a balance to ride.

Three Things You Can Do for Your Money in Retirement

I interviewed the ladies at a buffet-style restaurant during the afternoon special, and the message I got was one of balance. Pay attention to your everyday actions so that you can afford to do the things you truly enjoy. (Which isn't to say they don't enjoy the buffet, too! We had a good time.)

Continue your good habits:

I made sure I had enough money by being pretty careful with money my whole life. When I was young and didn't have very much money, I always tried to save some. I put it into CDs, and finally got enough money to buy some railroad stock and some Anadarko. I get a big enough pension that my account grows every month, a little. Another thing I never do is buy anything on time payments. If I don't have the money I don't buy it until I have enough money. So I never borrow.

Work hard, and then enjoy the fruits of your labor:

The kids are always after me, "Spend it Mom, spend it and have it a good time." We worked hard so that we could retire. We worked very hard when we were younger -- and you hear this all the time -- and did without things. If we couldn't pay cash, we didn't have it. And so you learned to be real frugal with your money. So that way when you came of the retirement age you were able to retire. Where if you hadn't watched it when you were young then you can work the rest of your life. And that wasn't in our plans, to work the rest of our life. Have a very nice living while you can.

The refrain here is to manage your money carefully by paying cash and making sure that you continue to make wise decisions throughout your retirement years -- while you have fun too.