Jonathan Clements's Blog, page 58
May 8, 2025
Let’s revisit an important retirement living topic. How’s it going? Great expectations
I hear about this topic on YouTube retirement videos. It has also been a topic on HD from time to time. We all know about the process of preparing financially for retirement, but it seems that for many people facing a retirement lifestyle is equally challenging.
Honestly, I can’t relate. I never thought about what retirement living would be like. I had no expectations. Perhaps taking phased retirement for 18 months was a factor, but even when I decided on doing that it wasn’t with a plan to prepare for retirement, it was purely a financial move - collecting a pension, Social Security and half my pay simultaneously. Admittedly it gave me a taste of more free time and a loss of work related status.
It may be retiring at 67 was a factor as opposed to taking the leap at 55 or even 60, when the retirement years might be longer. Still, I have been fully retired over 15 years with no disappointments or regrets.
Why did I retire? I liked my job, that’s not it. I felt I had accomplished all I could. The senior leadership changed and in the process the company culture changed. At a meeting with the CEO about an incentive compensation issue he whipped out a flip chart and started writing formulas. It could have been Sudoku as far as I was concerned. That was it.
Perhaps I just have a dull personality. The older I get, the more mellow I seem to be. I am happy doing nothing if that happens. Connie maintains a pocket calendar with everything she (we) will be doing. There are two main activities. Family events and doctors visits. I write in “golf” twice a week. When there is a open date, I’m happy.
I’m equally happy traveling, even a road trip. I look forward to the five hour drive to Cape Cod, even driving to Florida in the winter.
SO, FOR THOSE RETIRED, how was the transition? Are you all settled into a comfortable retired life routine? Do you seriously miss any part of your pre-retirement life? FOR THOSE NOT YET RETIRED, what are your expectations?
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Do It for the Kids
That’s a phrase I often use when talking about helping the next generation. But my efforts have been mostly focused on my children and grandchildren. What about others in future generations, especially those from less affluent families?
Welcome to the Jonathan Clements Getting Going on Savings Initiative and the accompanying book, The Best of Jonathan Clements: Classic Columns on Money and Life.
The savings initiative aims to get young adults started in the financial markets with $1,000 contributions to Roth IRAs, with those contributions funded by both direct donations and the royalties from the book. The book consists of more than 60 of my old Wall Street Journal columns.
I’d love to take credit for all of this, but my involvement has been modest. After my cancer diagnosis, there was a move to establish a journalism award in my honor. I suggested the savings initiative instead.The heavy-lifting was then done by five luminaries of the personal-finance world: Christine Benz, Bill Bernstein, Karen Damato, Mike Piper and Allan Roth. I consider all five to be friends, and all have some involvement with the John C. Bogle Center for Financial Literacy. Also working on the initiative are two other groups: J-PAL North America and the City of Boston’s Summer Youth Employment Program.
Meanwhile, the fine folks at publisher Harriman House assisted with the book's design, and The Wall Street Journal allowed my old columns to be reprinted at no cost. Indeed, the program is being supported by both the Dow Jones Foundation and News Corp., the Journal’s publisher.
You can read more about the savings initiative here, and also in Jason Zweig’s Wall Street Journal article from earlier today. Just to be clear, I’m not making any money from the book, and nor are any of the other participants. Want to pitch in? There are two ways:
Buy copies of the book or purchase the Kindle edition.
Make a tax-deductible donation.
I don’t know of any other program that takes young adults and gets them so directly involved in the financial markets, providing not just the money to get started, but also the investment vehicle as well. Will it lead some of these young adults to become regular savers and investors? If it does, lives will have been transformed. How cool is that?
Jonathan Clements is the founder and editor of HumbleDollar. Follow him on X @ClementsMoney and on Facebook, and check out his earlier posts.The post Do It for the Kids appeared first on HumbleDollar.
The Wrong-Sided Man by Dennis Friedman
I usually go for my four-mile walk before sunrise. I like to get an early start to my day. I’ve gotten to know a few folks who I see on my way around the neighborhood. We exchange pleasantries as we pass each other.
But there’s one gentleman who is not so friendly. He looks like he’s in his early thirties—about forty years younger than me.
All the people I encounter walk on one side of the sidewalk, as if they’re walking on a moving walkway at the airport or driving a car. This guy is determined to walk on the same side as me, even though we’re going in opposite directions.
I was surprised the first time we met that he was reluctant to move over. The other times, he would move over at the last second to avoid a collision. The last time, we came to a dead stop and stared at each other. Then he intentionally bumped my shoulder as he went around me. Each time, I kept thinking he would finally get it and walk on the opposite side, like the rest of the folks in the neighborhood.
One morning, I was late for my walk and saw him walking, as he usually does, on the wrong side. Another younger man, about his age, was approaching from the opposite direction. This time, the wrong-sided man moved over in plenty of time to let the other guy go by. There was no confrontation like there was with me. He knew what side of the sidewalk he belonged on.
I really don’t know what I would do if I ran into the wrong-sided man again. If I move over, I feel like I’m letting him push me around and not standing up for myself. If I don’t, then we might get into an altercation.
My wife says I’m too old to confront him. “Just move to the other side when you see him coming. He doesn’t care that you’re an elderly person. If he did, he wouldn’t be acting this way.”
My wife is probably right about him not caring how old I am. One day, I was walking from the parking lot to Trader Joe’s. A fairly young man in his car was waiting for an elderly woman to walk by. He was laughing. At first, I thought he was laughing about something he heard on the radio. But he was actually laughing at the elderly lady because of the way she was walking as she struggled to get to the store. He had no sympathy for her plight.
I read in the newspaper that two women beat up and killed an elderly man while he was waiting for a train. He was about my age.
Scammers and con artists see the elderly as easy marks, too. When my mother was alive, I always told her not to answer the phone if she didn’t recognize the number. Now, I find myself susceptible to the same criminals I warned my mother about.
I received a phone call from the Geek Squad, saying they were going to renew my service contract unless I called a certain number. I had once used them to help with a computer problem, but I didn’t know I had a service agreement with them.
I called the phone number I used before when I needed help. I told them what had happened. The man said it was a scam and to ignore it. I asked him how they knew I had used their service, and how they got my number. He kept saying, “Ignore it and don’t call them.” He sounded like me when I was taking care of my mother.
We should all beware of the wrong-sided man — especially the elderly, who may be more vulnerable. Don’t assume because you’re a senior someone is going to be kind and thoughtful.
Meanwhile, I changed my route so I don’t run into the wrong-sided man again. I thought it was childish to get into an altercation over something so meaningless. But I also knew that if I met him again, I wasn’t going to budge.
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Wall Street Journal Article about Jonathan’s New Initiative
Today's WSJ has a Jason Zweig article about the the Jonathan Clements Initiative.
This will be paywalled. https://www.wsj.com/finance/investing...
Intrepid readers can also find a link or two about how to donate if you are not buying the excellent new book.
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Generational Perspective
Many Humble Dollar readers, including myself, are on the older side - approaching retirement or already retired. Readership tends to be relatively affluent and educated. Our financial and social perspective may at times be influenced by a generational outlook. At the risk of overgeneralizing, here are some possible baby boomer versus Under 40 year old viewpoints:
Artificial Intelligence
Baby boomer: A new development with many unknowns and exciting possibilities. AI could play a dangerous role in future scams targeting them.
Under 40: A helpful resource for day-to-day usage. AI could pose a threat to their jobs and future career path.
Social Security
Baby boomer: A dependable economic safety net which hopefully will not change.
Under 40: An employment tax which may or may not provide benefits by the time they retire.
Homeownership
Baby boomer: A foundational investment which provides a major source of savings and wealth.
Under 40: Limited inventory and priced out of certain markets. It could feel unattainable without some parental support.
Work / Life Balance
Baby boomer: An entitlement after a lifetime of hard work.
Under 40: Why should they have to wait until they are older to enjoy life? Will working even harder matter anyway?
Economics of Family
Baby boomer: Having a family has been part of traditional planning.
Under 40: When is the right time (if at all) for children given financial challenges?
Have you noticed any differing perspectives between generations which may be interesting to explore?
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EO 14249 Mandated Electronic Payments
The fact sheet states that, effective September 30, 2025, the Federal government will cease issuing paper checks for all disbursements, including intragovernmental payments, benefits, vendor payments, and tax refunds.
The fact sheet also states payments made to the Federal government, such as fees, fines, loans, and taxes, must also be processed electronically where permissible under existing law.
You can read the full Executive Order as it appears in the Federal Register here and the White House Fact Sheet which summarizes the Executive Order here.
If you are still writing paper checks to pay your estimated tax payments or the balance due then you may want to switch over to electronic payments sooner rather than later to avoid the learning curve.
I was stationed in Germany in 1973 and the first half of '74 in a maintenance company for the Army's Third Armored Division. When my company XO was promoted to CO, I was his personal clerk and driver for a while. The standard process to pay enlisted troops on our base was that once a month the XO, his driver and a appropriate armed detail would go to a nearby Kaserne where we received and counted the cash to pay everyone who did not have direct deposit which I would guess to be 90%+ of the enlisted men in our company of about 200 men (we had no women assigned to our company).
When we returned to our base we then divided the cash into the amount each man would receive. At that point usually mid-morning the company would fall into formation. After announcements those with direct deposit would be dismissed to go to their assigned duty post and then the XO and his clerk would pay those without direct deposit, man by man. I would count the money out and then the payee would also count the money and then sign their paper check to acknowledge payment in full as the XO supervised. The XO and I hated payday. When the XO was promoted he did something about this procedure.
On the first payday after his promotion to CO we had our normal formation but then things changed. No one was dismissed and the entire company walked (marching would not describe this) to the Kaserne at Erlensee from the Fliegerhorst Kaserne at Hanua a distance of about 7Km a little over 4 miles. We paid the men without direct deposit at Erlensee, and then the entire company walked back to Fliegerhorst. When we arrived back near the end of the day, we had another formation and my CO announced that he hoped everyone had enjoyed the day and noted that we would be following the same process every month until at least 90% of the company had elected direct deposit.
We did not have to make the walk again as most everyone had elected to have direct deposit by the next payday. My CO had found the right incentive. Yes, the CO and I also walked.
So, what motivates you best, the carrot or the stick?
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Don’t Go Breaking My Heart by Marjorie Kondrack
Love and heartbreak are human experiences. Heartbreak is not restricted to the end of a relationship. It can be unrequited love, the death of a loved one, divorce, unmet expectations we have of another. Or other severe emotional conditions.
Harvard Medical School recently published an article about a phenomenon known as Broken Heart Syndrome. It is a real condition known as Stress Cardiomyopathy or Takotsubo syndrome, and can be deadly. But most people recover quickly without any long lasting effects. Although it mimics a heart attack, the key difference is that in broken heart syndrome there are typically no blockages in the coronary arteries
While dying from a broken heart sounds like something that happens only in romance novels, it can grab the headlines. In 2016, actress Debbie Reynolds unexpectedly died four days after the passing of her daughter, actress Carrie Fisher. Headlines blared, “Can Someone Die of A Broken Heart?”
Broken heart syndrome isn’t what the media has painted it to be, but it can be fatal for about 1% of people who experience it. Previously it was thought that it affected mainly women over the age of 50, but a recent study by the New England Journal of Medicine indicates a marked increase in the percentage of men affected as well. Researchers attribute this to the likelihood of, at some point beyond mid-life, the response to stress can weaken or stun the heart.
An ultrasound (echocardiogram) of the heart can show how well the heart is contracting and whether the heart has taken on what has been officially termed as the Takotsubo shape. Your heart suddenly changes shape and weakens.
While older women are the most likely to develop broken heart syndrome they also have the best chances of recovery. Men and younger people are less likely to get the syndrome, but their outcomes are typically worse when they get it.
Broken hearts can heal. Some may need ongoing treatment and stress management techniques. It’s important to follow up with a cardiologist who can tell you when your heart muscle has fully recovered. To reduce your risk of this and other heart related condition, you can invest in self care practices that will enhance your emotional well being:
Improve or eliminate stressful circumstances (toxic relationships, isolation, taxing jobs)
Prioritize sleep
Invest a little time in stress reducing routines, such as deep breathing, meditation and tai chi.
My favorite: A walk outdoors in nature.
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May 7, 2025
A Tale of Excess
On a recent family trip to the UK I learned something new about car rental insurance. During my many years of business travel, we were always told to turn down the collision damage waiver, or CDW, insurance offered by the rental company. Our personal credit card provides rental car insurance, but you must decline the CDW and reserve and pay with that card.
When we picked up our car hire just outside of Oxford we were pleased to see we’d been upgraded to a BMW 500 sedan. We inspected the car, took pictures of the few minor blemishes, and reviewed the additional insurance options. They offered something called excess insurance, which I was unfamiliar with. It was explained that in the event of damage we would be liable up to the value of the car. Excess insurance would cover that, but at £35 pounds per day. I declined this insurance down, thinking our credit card would cover any damages.
You can probably guess what’s coming next. Within a mile or so of leaving the office we missed a turnoff on a rotary and had to get off and head back on the highway. I made a distracted right turn on the entrance ramp in front of an oncoming VW van. The other driver did a great job of trying to miss us, and the impact was at a shallow angle at fairly low speeds. No airbags deployed and the car was still drivable. There was a significant crease, however, on the left (passenger side) of the car from front to back.
The mental damage was greater. The car hit right where my wife was sitting. We were both pretty shaken by the incident, but managed to safely drive back to the car hire office. The staff at the office were extremely professional and caring. Their first concern was our well-being. Once he ascertained that we were OK, the office manager gingerly explained that, since we hadn’t elected the excess coverage, we were responsible for the entire value of the car. We had to purchase the BMW at £56,685 pounds!
As you can imagine this added to our state of shock. Once we understood the situation we chose to divide the amount over 3 credit cards, with the majority charged to the card that we used to make the reservation. We were told that once the repairs had been made they would refund the difference between the excess amount and the actual damages.
After that we cancelled our reservations for that evening in the Cotswolds and returned to Oxford to regroup. At the hotel I contacted our credit card company and initiated a claim. The representative I spoke to had never heard of excess insurance, but was quite helpful. I initiated the claim and followed it closely over the next 6 weeks. I had to provide documentation of the accident, the rental reservation, the final receipt, an accident report, a drawing of the accident, and credit card statements showing the charges and future refunds.
After about three weeks I received a detailed damage report listing the repair costs, fees, and a refund of £43,030.93 pounds. The refund was deposited to our credit cards within a week of receiving the letter. The insurance claim through our credit card for the remainder took a few weeks longer. They initially denied the claim because of the confusion about using multiple credit cards to pay the excess fee, and which card was used to make the reservation and pay for the rental. I had to write a detailed letter explaining the situation and appeal their decision. The case had to be reviewed by their senior appeal board. We never received notification of their decision, but 2 weeks later we received a FedEx package with a check reimbursing us for the repair costs and fees, about £13,654.07.
Clearly this process was unknown to the American insurance companies. I even to spoke to our personal car insurance broker and they were amazed. At the end of the day, we lost about $127 due to currency conversions. We were able to manage the situation and pay off our April credit card bills on time with no interest charges. It didn’t help that we also had a sizeable tax due in April, as well as a $14,000 payment for our next trip this summer. April was a challenging month, but we weathered the storm and came out intact.
There are some obvious lessons from this story. I didn’t properly research auto rentals in the UK. I also didn’t understand the nuances of our credit card’s auto rental insurance, especially how they interact with the rental company’s insurance and our personal auto insurance.
I’m grateful that no one was injured, and that we had the financial resources to manage this. Afterwards I wondered what would have happened had we not had the available credit to charge the full excess. Our credit score has always been very high, but it took a 100-point hit from this. I’m not too worried and will monitor it to see if it returns to its previous level.
Sadly, the accident precluded us from completing our plan of touring the Cotswolds, and Hope Cove. We considered using trains or car services, but we elected to return to London and fly home the next day. Ironically, that coincided with the electrical substation fire that shut down Heathrow airport, so we spent a final weekend enjoying London. There is still a lot of the UK we want to see, but we’ll have to think about how we want to accomplish that.
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Quinn questions the value of a seven inch matzah ball in a $33.00 bowl of chicken soup?
A few days ago Connie and I went to a unique NJ restaurant for a light dinner.
We each had a root beer, we shared a pastrami and turkey sandwich and one bowl of matzah ball soup. The bill was $108 before tip. Now you know why Harold’s NY Deli is unique.
Have you concluded it is a upscale, white table cloth place or just a rip off? Now, the rest of the story.
The sandwich is so large they give you six extra slices of bread to break it down. We made two stacked-high sandwiches out of half of it. The soup comes in a large bowl with a matzah ball 7” in diameter, two individual bowls and a huge ladle.
Nothing they sell is actually for one person or two for that matter. A pickle bar comes with each meal.
On the breakfast menu one pancake is $24.95, but it’s the size of a Mini-Cooper tire.
If you want desert be warned, the cakes are fourteen inches high. A slice of carrot cake is $28.95 - designed for 2-4 people they say.
I wonder the reaction of a new customer not knowing what they are getting into. The menu has meals for $100 and more - for several people or a few nights at home, but you need to read the fine print to learn that. The Hungarian Goulash dinner is $112.95
When people leave with their leftovers, it looks like they are carrying a weeks groceries. We have 3/4 of a matzah ball, a half gallon of soup and fixings for two large sandwiches in the fridge. They even give you a cup to take home what’s left of your drink if you like. Take some pickles and slaw too.
It’s a marketing gimmick, but it works and it’s fun-as long as you can use the leftovers - and don’t pass out at the first glance of the menu.
Is there value? Probably not. I suspect some of those leftovers are thrown out. One thing for sure, this place is not for dieters or healthy eating choices.
On the other hand, two meals for two people comes to $27 each - but it’s still just soup and a sandwich.
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