I have a phone appointment on Friday with a financial planner. This is part of my quest to at least try and act like a grown-up and cross items off my to-do-before-I’m-really-old list. We got our wills done (finally) and associated trust established, so it seems likely we are now immortal, because I have done the advance prep so the kids will not have to wig over the paperwork and expense after we move on into all that comes next.
With the financial planner, my primary focus is retirement planning. I turned 54 last week and realized I have only 13 years left before I am eligible (under present rules, anyway) to collect my full social security amount. With M being 4 years older, he is in single digits, with only 9 years left. From life experience thus far, I know those years will pass quickly, so I am trying to get our affairs in order now.
We got a late start with retirement savings. However, my mom’s death gave us an unexpected boost, and using the retirement calculators we do not look too bad off right now. But I want to do better, and my floundering around on my own is not particularly reassuring. M is not especially worried, because as long as we have our home and can afford our basic day-to-day needs we will be fine. Our present-day social security income calculations indicate that is entirely possible even without the retirement savings, but we would both prefer to have more options.
One of the things I am doing now is paying extra principal on our mortgage, because I really want that bad boy retired before the sun sets on 2023, when I am 62 and M is 66. Is that smart, though? We have a 15 year mortgage with an interest rate of 2.75%. Even if I do not give them another dime in extra principal, our mortage will be retired in April 2027. While emotionally we want it gone yesterday, financially I’m not sure it is most bang for our bucks paying extra principal each month or investing that money now. I would like the FP perspective and opinion.
We already contribute the maximum amounts to retirement vehicles available to us – Simple IRA through my full-time job, traditional IRA for M, Roth IRA for me – as well as saving in a taxable investment for the future and regular savings account for home improvement projects, emergencies, etc. I frequently wonder if it is enough? Striking the balance between enjoying our lives in the moment and saving for our older and grayer years is challenging for me, and it feels like we go through these intense, expensive spending sprees that are actually nothing more than utilizing budgeted funds for specific objectives. Still, saving money is an ongoing discipline for me, because it does not seem to come naturally or easily. My fear of cat food consumption at 70 is part of what drives me in maintaining both a full-time job and the couple of part-time gigs.
As I said, M is not especially worried, so I therefore worry enough for both of us, the kids, and probably any future grandkids. Our life and lifestyle is relatively simple. We have no major ambitions to travel the world or acquire expensive hobbies once I cease working quite so much, although we do hope and work now at achieving/maintaining good health so we can relax and enjoy our future. The biggest dream is possibly a motor home, so we can be self contained with our own stuff as we venture to beautiful places to walk and hike and run. We are not talking some tour bus sized thing – a modest sized carriage for the two of us – with enough oomph in the engine to get us where we wish to be. Hopefully that will be acquired in the next 5 to 6 years and without financing, but we shall see.
Finding balance – why is it so hard? While I am speaking financially in this post, I and just about everyone else I know struggles with it in various forms.