Jonathan Clements's Blog, page 88

Eat Sleep Move

WHEN I WAS A KID, I would hear “old people” say, “If you have your health, you have just about everything.” I heard it. I understood it. But in truth, I didn't really understand it—until I joined the “old people” category.

Looking back, I realize I’ve been blessed with good health. I’ve never broken any bones. I’ve never spent a night in the hospital. I’ve never had any long-lasting illnesses. I don’t regularly take medication, just a Centrum Silver daily vitamin. I’m lucky and I know it.

I am also not so smart. I need simple truths to help me navigate daily life. For instance, the classic balanced portfolio—60% stocks-40% bonds—is a simple investment mix that should keep me out of trouble. Dollar-cost averaging lets me add new money to my investment funds without thinking too much. Mutual funds allow my money to grow without me getting actively involved. It’s my kind of investing.

Similarly, when it comes to my health, I needed a simple strategy. I found it in the concept of eat-sleep-move. What this means is eat right, sleep eight hours a night, and move or exercise regularly. I have, in turn, spent time studying each of these three to find simple tricks so I get them right.

Eat. Keep your plate colorful. If it only has brown and white colors, that’s not good. Red, green, blue and orange only come from fruits and vegetables. We’re often told to eat more fruits and vegetables, but which ones? As long as you follow the colorful plate strategy, you should be getting the variety you need.

Sleep. Go to bed at the same time and get up at the same time. This allows your body to get into a routine and should lead to consistent sleep. Setting up your bedroom for sleeping, with the proper temperature and darkness, will also help. It doesn’t matter whether you’re a night owl like my wife, or an early-to-bed, early-to-rise person like me, get your eight hours or, failing that, as many as you can. But be careful not to sleep too much.

Move. Do something—anything—every day, as long as it involves moving. Thinking doesn’t count. Unless you’re sleeping, sitting is better than lying down. Standing is better than sitting. Walking is better than standing. Running and biking is better than walking. The best part: You don’t need to go to the gym. Just get outside. It’s cheap and always available. This includes bending and squatting while mowing the lawn or tending to the garden. Just do more stuff.

The healthier you are, the less you spend on medical care. The older you are, the more expensive medical care gets. Want to save money? Focus on the eat-sleep-move strategy. It’s no guarantee you’ll stay healthy—but smoking, drinking and eating hamburgers are almost a guarantee you won’t.

Don’t think of it as needing to behave. Instead, think of it as saving money in the long run. How long? How about 100 years—without going broke?

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Stories We Tell

YALE UNIVERSITY economist Robert Shiller, in his book Narrative Economics, argues that storytelling has more of an impact on economic events than we might imagine. It might seem like the financial world ought to be driven by facts and data, and yet stories often take on a life of their own.

For instance, financial narratives often play a key role in stock market bubbles and busts. More generally, financial myths and misperceptions are widespread, and navigating them can be a challenge. Examples? Below are five common myths.

1. "Investors should be careful when the market keeps hitting new all-time highs." This seems like it ought to make sense. Anyone who lived through a mania like the dot-com bubble might conclude that bubbles inevitably burst, so it’s best to step aside when markets are hitting all-time highs.

But here’s the problem: Because the stock market trends upward over time, it’s not unusual for market indexes to hit new all-time highs. J.P. Morgan provides this perspective: In nearly 30% of cases when the market closes at an all-time high, that new high has represented a “floor” below which the market has never dropped more than 5%. In other words, while sometimes a bubble truly is a bubble, that’s not always the case—and it’s difficult to tell the difference.

2. "In my parents’ generation, people could live on the income from their portfolio. Things were better then." Look at your investment statement, and my guess is that dividends aren’t the main attraction. Some stocks don’t pay dividends at all and, on average, the S&P 500 currently yields just 1.5%.

That stands in contrast to history. Between 1926 and 2023, dividends accounted for nearly 40% of the S&P 500’s total return. As a result, retirees used to talk about living off their portfolio’s income. Investors nostalgic for that era might be less enthused about today’s more meager dividends. But you shouldn’t be concerned.

It’s not that companies are less profitable today. To the contrary, public company profit margins have increased over time. But companies have changed how they allocate those profits. In the past, a much greater portion was paid out to shareholders in the form of dividends.

But today, companies allocate roughly equal amounts to dividends and to buying back company shares. Why the shift? Consider the change in how companies compensate their executives. Today, there’s a much greater emphasis on stock-based compensation, and that’s created more of an incentive for managers to see their company’s share price rise. Result: Companies today allocate more cash to buying back shares because buybacks have the effect of driving up share prices.

Should investors be upset by this change? In my view, no. In aggregate, buybacks now account for about 1.5% of the S&P 500’s return, with dividends providing another 1.5%. Taken together, that 3% isn’t far off the 4% that investors have historically received as dividends. In other words, dividends may be lower than in the past, but investors are no worse off because total returns—that is, price appreciation plus dividends—are no lower.

3. "There’s a penalty if I claim Social Security while I’m still working." You may have even heard the formula, which sounds punitive: Social Security will deduct $1 from benefits for every $2 earned. While this is technically true, it overlooks some important details.

First, this penalty is imposed only when benefits are claimed before your full Social Security retirement age (FRA), which is between ages 66 and 67, depending on the year you were born. Second, this isn’t a true penalty. Those dollars aren’t lost forever.

Instead, after a worker reaches FRA, Social Security adds back the amounts that were earlier withheld. In addition, any year in which you work will add to your Social Security earnings record, and that could potentially increase your benefit. The bottom line: If you want to work part-time in retirement while receiving Social Security, you shouldn’t worry.

4. "It’s a mistake to claim Social Security before age 70." Age 70 is when the largest benefit check is available, and for that reason it’s become a sort of personal finance commandment that everyone must wait. But this should be viewed more as a guideline than a rule.

Why? While you wait, you’re also taking a risk of another sort. For each year that you don’t claim benefits, your benefit needs to be that much larger down the road to make up for the missed years. And because of the time value of money, that breakeven point is pushed out even further.

For many people, it makes good sense to take this risk, since the breakeven point tends to be around age 78, and folks who make it to 70 can expect to live until their early- or mid-80s. But if you’re married, the math changes. That’s because it’s only worthwhile for both spouses to delay until age 70 if both spouses outlive that breakeven point. That’s why it can make good sense for one spouse to claim earlier than 70.

5. "The estate tax won’t be a problem for me." Under current rules, only a tiny fraction of estates—just 0.2%—are large enough to owe any estate tax. That’s because, for a married couple, the federal estate tax applies only to estates with more than $26 million in assets. Even after the potential rules change in 2026, that figure will still be very high, at $13 million for couples.

For that reason—and because there are other less complicated strategies available that can shrink an estate—many people dismiss the idea of formal estate tax planning. For some, that makes sense—but it depends. Twelve states and the District of Columbia impose their own estate taxes, and six states have inheritance taxes, meaning that they tax the recipient of a bequest.

Making this even more of a challenge, many jurisdictions tax estates with as little as $1 million. Simply owning a home in those states might push an individual above the threshold. And while state estate tax rates are lower than the 40% federal rate, they’re not immaterial—with top rates between 10% and 20% in many cases. For that reason, it’s worth researching the rules where you live.

Adam M. Grossman is the founder of Mayport, a fixed-fee wealth management firm. Sign up for Adam's Daily Ideas email, follow him on X @AdamMGrossman and on Threads, and check out his earlier articles.

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What Our Dollars Buy

WHEN WE SPEND MONEY, we’re looking to get something in return. But what? Forget classic budgeting categories like housing, food, utilities, insurance and entertainment. Instead, suppose we used a completely different classification system—one that reflected the physical, social and emotional benefits we garner.

The list below is, I suspect, far from complete, especially when I compare it to the 16 basic desires developed by psychologist Steven Reiss. Moreover, as you’ll see, while an expenditure might fall predominantly into one category, it often touches on other categories as well.

Still, I find this an interesting exercise. Why do we spend as we do? Here are 11 possible motivations:

1. To satisfy basic needs. This is the biggest driver of spending in less affluent nations. Even in the U.S., many folks will claim their spending is driven largely by their needs and those of their family.

But do our needs really determine the bulk of our spending? Count me among the skeptics. If we’re talking basic needs—satisfying hunger and thirst, protecting ourselves from heat and cold, getting from one place to another—such spending likely accounts for a relatively modest portion of most U.S. households’ monthly expenditures.

2. To feel more secure today. This is the reason we stash dollars in our emergency fund, pay those insurance premiums and plan our estate. It also shows up in other expenditures, such as the safety features of the cars we buy, the purified water we purchase and the home alarm systems we install. How much do each of us value a sense of safety? All we need do is look at where our dollars go.

3. To give us hope. We all want a better future for ourselves and for those we love. This drives the education costs we incur and the causes we choose to support. But its greatest manifestation is the money we save each month for long-term goals, notably retirement.

4. To forge stronger social bonds. Much discretionary spending is devoted to building social connections, whether it’s taking the family on vacation, going out to dinner with friends, flying across the country to see the grandchildren or picking up the tab on that first date.

5. To brighten our mood. We humans devote a surprising amount of time and money to trying to change how we feel. Some folks go on spending sprees to cheer themselves up. Others drink alcohol to relax after a hard day at the office. We might take a vacation to recharge after months of working long hours. Or play video games and watch TV to break the monotony of everyday life. Or go to amusement parks, visit casinos and day-trade stocks to make life more exciting.

6. To improve our health and beauty. I’m not just thinking about visiting the doctor or the hairdresser. Our desire to live a longer, healthier life—and look good along the way—drives spending on personal trainers, makeup, organic food, spinning classes, manicures, Weight Watchers and exercise equipment. Such spending is often accompanied by a large time commitment. Indeed, I figure exercising—bicycling in the morning, taking an afternoon walk and so on—probably devours at least 90 minutes of my day, and sometimes more.

7. To make us wiser. Many folks devote large sums to learning more about themselves and the world around them. These dollars might be lavished on education, books, therapy, museum visits, travel and more.

8. For the pleasure of helping others. When we give to charity or volunteer our time, are we acting solely out of altruism or are we trying to make ourselves feel more worthy? Whatever our motivation, giving is a large budget item for many folks, and for that we’re all better off.

Such giving extends to family and friends. Indeed, I expect my financial gifts to my children and grandchildren will easily rank as this year’s largest “expenditures.” The gifts will make them happier—but not, I suspect, as happy as the giving will make me.

9. To impress others. Arguably, there’s an element of signaling to every dollar we spend. With our purchases, we’re looking to tell the world who we are and what we value. Even frugality is a form of signaling, though the price tag is certainly smaller than for the conspicuous consumption that most HumbleDollar readers would disdain.

10. To enjoy a sense of accomplishment. If we have a job, we can have a pleasurable sense of progress and get paid at the same time. That sense of accomplishment can be so enjoyable that people will spend money to get a taste of it even during their non-work time.

Think about the folks who take hiking vacations, run marathons, volunteer, undertake home improvement projects, and spend hours on arts and crafts. Such activities feel like a worthy way to spend time and money—the sort of things we’ll gladly tell the neighbors about, rather than revealing that we spent the afternoon binge-watching Netflix. The good news: Among the budget items listed here, seeking a sense of accomplishment is typically one of life’s great bargains.

11. To honor earlier generations. Whether we realize it or not, a lot of our spending is influenced by our parents and grandparents. That’s undoubtedly true for me. It’s the reason I make cottage pie, own antiques, occasionally drink mojitos, order wiener schnitzel whenever it’s on the menu, and make a point of regularly visiting England.

To be sure, mojitos—which my father had a fondness for—are not so expensive, while a trip to England certainly is. But either way, such things have a meaning for me that goes far beyond their obvious attributes.

Jonathan Clements is the founder and editor of HumbleDollar. Follow him on X @ClementsMoney, on Facebook and on Threads, and check out his earlier articles.

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If Not Now, When?

WE WERE DINING WITH close friends when the conversation turned to foreign travel. Stories were recounted of ventures to exotic and faraway lands filled with inspiring people, unique cultures and historic sites.

My wife and I were humbled by the sheer number of trips our friends had taken. We were shy to admit that our international travel bucket was relatively empty, and we had embarrassingly few stories to share.

This wasn’t a matter of keeping up with the Joneses. We simply had neither the time nor the opportunity for international adventures while we raised our twins. At the time, that type of vacation wasn’t a priority for our family.

On a whim, during our drive home, I promised my wife we’d take an international trip. We had a huge list of destinations we dreamed of visiting. Besides, we include a travel line in our annual retirement budget. If now isn’t the time to venture forth, then when?  

The following evening, while sharing a cheeseboard and Moscato on our patio, Lori reminded me of my promise. I knew where this conversation was heading. I told myself that now might be a good time to refill my glass of vino.  

Years of training caused my well-oiled frugal senses to once again begin to tingle. But a promise is a promise, or so my wife tells me. And now that we were both retired, there was no reason not to tackle one of our bucket list items.  

As if I needed more convincing, Lori suggested we do this to celebrate the one-year anniversary of my successful brain surgery. Alas, I couldn’t refute that logic. No additional arm twisting was required.  

My wife suggested Costa Rica as a destination. I’ve been a card-carrying molecular biologist for three decades, and have always admired the treasure trove of biodiversity found in equatorial countries. So it was decided.

I must confess to an irrational fear of vacationing, especially trips outside the U.S. Part of this stems from studying endemic micro-organisms for decades. Leishmania, leprosy, malaria, tuberculosis and schistosomiasis are part of my everyday vocabulary. I know too much about the mechanisms underlying rare diseases in underdeveloped countries.

Yet, truth be told, I also feel overwhelmed and anxious when making travel plans. The 14th century French philosopher Jean Buridan described a scenario where a donkey placed equidistant between two equal bales of hay will starve due to indecision. I must be an ass, as I too have difficulty making a decision when there are too many choices available.  

Therefore, I acquiesced to our travels, with the understood caveat that Lori would have to do the heavy-lifting and assemble a working itinerary. I don’t mind making suggestions now and again. But I’d rather be surprised upon arriving at our destination. Honestly, all I needed was a hike in a rainforest, plus breakfast with a steaming cup of Joe made from freshly harvested and roasted coffee beans.  

Over the course of a week, I painfully watched my wife struggle with the excursion planning, picking from among the dizzying array of places to stay, coffee plantations to see, rivers to cross and mountains to climb. Finally, it was too much for me to bear. I felt her herculean efforts were far outweighing the trip’s potential fun. So, completely out of character, I insisted we utilize the services of a travel agent.

I rationalized that our once-in-a-lifetime trip should not be weighed down by my frugal tendencies. Although it was mentally excruciating, I opened up our checkbook and gave the travel agent a working wish list and hopeful budget. It took five or six iterations of the desired activities, and three upward adjustments to the final cost, but we finally arrived at an itinerary we loved.  

We never looked back. I paid for the trip, plus insurance, in advance. What helped most was an assumed mental outlook where I considered funds as already spent prior to beginning the trip. I realized that we have the freedom to travel, and should not feel guilty for dipping into funds for an expense already included as a line item in our annual budget.  

I’m not writing this piece to detail our travels. Yes, it rained on our hike in the rainforest. Yes, the clouds limited an awe-inspiring view of the cloud forest. Yes, taking a night walk in a forest filled with nocturnal pumas, sloths, snakes and rodents of unusual size is quite exhilarating.  

Rather, the purpose of this tale is to convey that I’m starting to understand the invigorating power of experiences and their worthiness as a use for money saved over a frugal lifetime. While frugality has its place, sometimes we need to let go of our funds and enjoy what life has to offer. After all, money is simply a tool and not an end in itself.  

We were also able to target another high-priority item on our bucket list: random acts of kindness. Tips were included for almost every aspect of our travels. Still, it felt good to hand out additional and unexpected $5 or $10 bills to people who made our experience more enjoyable. While it didn’t make a significant dent in our lives, it made a world of difference to the recipients.  

Finally, we noticed that the locals were content, with a markedly slower pace of life. Sundar Mohan Rao wrote a HumbleDollar article about an acquaintance who, when asked how he was faring, commented that any day above ground was a good day. The Costa Rican locals embrace that viewpoint.

We heard two expressions multiple times. First was buena vida, which means good living. The second expression was pura vida, which connotes an easy and pure outlook on life. The locals took these expressions to heart, incorporating these ideals into everyday activities—a goal to which we can all aspire.

Jeffrey K. Actor, PhD, was a professor at a major medical school in Houston for more than 25 years, serving as an academic researcher with interests in how immune responses function to fight pathogenic diseases. Jeff’s retirement goals are to write short science fiction stories, volunteer in the community and spend time in his garden. Check out his earlier articles.

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Making Claims

HAVE YOU HEARD THIS nonsense about Social Security? It’s nothing but a Ponzi scheme. The trust fund is just IOUs. My favorite: I’d rather invest the money I pay in Social Security taxes because I’d get better investment returns.

All three claims reflect a fundamental misunderstanding of Social Security and how it works. Social Security is insurance—a form of annuity, a type of pension, a social safety net. It isn’t an investment and shouldn’t be viewed that way.

If, by Ponzi scheme, we mean that this year’s taxes are used to pay current beneficiaries, I guess it is. The same can be said of most government programs. That’s the way government works—or should, except we also pay for government programs by running deficits.

The trust is nothing but IOUs, or so it’s said. If you mean the trust purchased special interest-paying Treasury bonds as an investment, with the government promising to redeem those bonds, then—yes—the trust fund holds IOUs. But that’s virtually the same promise made to American investors and foreign governments when they buy U.S. government bonds.

Now we have my favorite: Give me the taxes I pay and let me invest them, and I’ll get better returns and accumulate significant assets. This is simplistic. Can you imagine that strategy working out for the vast majority of Americans, with their low level of financial literacy, poor savings record and scant stock market experience?

This approach also ignores a key fact: Social Security is much more than an inflation-adjusted retirement-income program. Benefits are also available to disabled individuals, to surviving spouses and children, to ex-spouses—even multiple ex-spouses. Some of these folks never paid a penny in payroll taxes. Want to take a chance at investing your Social Security taxes? You better hope your life goes exactly according to plan.

It seems to me Social Security is a very good investment—too good, actually, as evidenced by its chronic underfunding. During my working life, beginning in 1959 while still in high school, I paid $132,743 in Social Security payroll taxes and my employers paid an additional $133,423. In return, I received in benefits all I contributed within four years of starting Social Security—and that doesn’t include my wife’s benefits based on my earnings record. Since that breakeven, I’ve collected 11 additional years of benefits.

I don’t know about rates of return, present value and such. But I see this as a good deal, and it can be an even better deal for lower-income beneficiaries.

But there’s one deal that’s better still: Medicare. In total, I paid $98,063 in Medicare payroll taxes. That sum was easily exceeded by the cost of one short hospital stay and the accompanying medical care. My wife paid no Medicare taxes, but received several hundred thousand dollars in benefits for her eye injury.

I hope to add to my Social Security “return.” But I’m happy to let others come out ahead on Medicare spending.

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Handing Over the Keys

IN 1954, THE SPANIELS sang, "Goodnight, sweetheart, well, it’s time to go."

It may not be time for me to go, but it is time to hand over the keys to our rental properties to my wife, Alberta. Since 1983, I’ve had primary oversight over our family’s residential real estate. At age 79, I’m dogged by heart disease and cancer, and weary of scrimmaging with delinquent renters and dishonorable service people. After assisting me and grooming for the role, Alberta is ready to take the reins.

I’ve previously lamented my imminent passage from retirement’s challenging accumulation phase to the monotonous withdrawal phase. Little such remorse accompanies letting go of the head-knocking that comes with private property ownership. I’ll welcome the release from anxieties over vacant units and the dreaded black mold.

Such family transfers of responsibility can run the gamut. Maybe your spouse or partner just needs to get into the habit of scrolling down the credit card statement, ensuring the charges are legitimate. On the other hand, maybe he or she needs to get up to speed on the nooks and crannies of your complex family trust.

 Passing the baton may also call up old relationship battles over who’s in control. Be aware of any festering conflicts brought to the surface by the shift in decision-making authority. Here are some changes I anticipate as Alberta takes over.

Our marriage will suffer less tension and anxiety. As Alberta became more comfortable making business decisions, she naturally expected our input to be 50-50. Taking a page from my father’s playbook, I saw it as 51-49—in my favor. Now, we agree the balance of power will be something like 25-75, with her taking the lead.

An added bonus: The investment anxiety that has stalked our relationship will be reduced. Alberta won’t be freaked out, as I’m prone to be, about an impending empty unit or a leaky roof. She’ll just calmly get together with our property manager and handle it. And I’ll need to be patient with the often-stressful re-rental process.

Oversight will be more hands-on than it has been. Years back, we secured first mortgages at nominal interest rates from motivated sellers. In a very real sense, we were “buying the mortgage” as much as the property. We prioritized keeping good tenants by raising rates judiciously and limiting maintenance expenses to what’s necessary, rather than what’s gorgeous.

Here comes a true confession that may cost me some credibility. How hands-off have I been? Well, it’s actually been more arms-length than hands-off. I’ve met monthly with the property manager to ensure all the ducks were in a row. But I’ve never personally visited most of the properties since I bought them 40 years ago. I never interviewed a single prospective renter.

We bought well and managed well, so inspections and meetings with potential tenants simply haven’t been necessary. This arrangement has allowed me to minimize my involvement in an activity I don’t enjoy, yet served as a profitable diversification from the vagaries of the stock market. Applying this model over 40 years, we profited handsomely from income and capital appreciation.  

Keeping renter turnover low is essential, because the cost of alienating or losing good tenants is prohibitive. You have the cost of primping the property for the new tenant, absorbing the property manager’s commission for renting the unit, and the silent cost of lost rent for the duration of the vacancy. And despite your best efforts to screen out problem tenants, you may get a real deadbeat to replace the tried-and true renter you just drove out, perhaps with an overly large rent increase. Of course, you can raise the rent on the new fellow, but it may take several years to recoup the outlays.

Alberta and I are reasonably well-informed about the intricacies of buying and financing, but egregiously unsophisticated about property maintenance and repair. Fortunately, we hired a long-term property manager knowledgeable where we’re not, and the manager was similarly committed to rental longevity and unremitting cost control.

Alberta’s modus operandi will play out very differently. For one thing, our battled-tested property manager of 35 years retired, and Alberta will now be working with a new person whose philosophy of management may conflict with my own. He’s competent and diligent, but uses established retail vendors before considering talented and versatile handymen or retired service people. No less important, he doesn’t always get second bids on large projects. To me, this gives a blank check to service providers who are relied on exclusively and know they’ll get the job without price competition. I honestly don’t know how Alberta will navigate these waters.

The new regime will value quality over cost. Where before it was merely mowing and blowing, our rentals will now get some landscaping. The new carpet will be premium rather than a step above commercial grade. This approach will reduce our income, but should also attract higher-quality renters and enhance property value.

My wife’s supervision will be more personal. Right now, I read over the monthly report, checking in only for elaboration of a missing rent or an unexpected humongous expense. Alberta will meet one-on-one with the property manager, periodically visit the premises and perhaps interview some of the rental prospects.

My major contribution now will be in the quantitative realm, like helping to translate the expense categories on the reports into IRS-speak. I’ll also be consulted on complex projects and weigh in on sensitive questions, such as the rare eviction and liability exposure.

While ready and relieved to let go, I’m under no illusion that stepping away from the role of family real-estate guardian will be without a sense of loss. I’m wistful, but also hopeful that the new division of responsibilities will help Alberta and me to work together effectively and harmoniously.

Steve Abramowitz is a psychologist in Sacramento, California. Earlier in his career, Steve was a university professor, including serving as research director for the psychiatry department at the University of California, Davis. He also ran his own investment advisory firm. Check out Steve's earlier articles.

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Talking My Book

I'M TURNING 70 THIS year, and that’s got me thinking about the legacy I’ll leave behind. Legacy for me involves much more than bequeathing money to the kids. It’s about the contribution I’ve been able to make and the people I've helped along the way.

Since retiring, I’ve been on a mission to help folks have a better retirement. This resulted in me co-authoring three books on the subject. In addition to my family, the books and what I do with them will be my legacy.

With that in mind, my plan is to give away the three books for free in exchange for readers posting an honest Amazon review about the books. Why am I asking for reviews?

For me, writing books is really hard and it takes me a long time to finish. I’m not a natural-born writer—more plodder than anything. I can’t tell you the number of times I feel like quitting while working on a book. It’s lonely to spend months and months locked away in my home office. It gets to me sometimes, especially during the summer months, when there are so many things I’d rather be doing.

What keeps me from quitting is reading the reviews posted by readers. I take pride in knowing that the books I co-authored helped someone, and that gives me the strength to get the next book done.

Another benefit I gain from reading reviews—both the good and the bad—is that I learn from them. Yes, there are bad ones, and I’m pretty sure one was written by my ex. Here’s a brief overview of the three books I’m offering:

Victory Lap Retirement. If you were intrigued by the ICE, or “I’ll continue earning,” approach to retirement that Jonathan Clements recently wrote about, you’ll enjoy this book. In it, we introduce a new model of retirement based on a combination of work and play that’s built on a foundation of financial independence.

Retirement Heaven or Hell. This book coaches you on how to successfully shift into retirement and avoid the stress that comes with this huge life change. It also outlines the nine key principles for a happy, healthy, fulfilling retirement.

Longevity Lifestyle by Design. After reading this book, you’ll understand what causes retirement shock and how it can be avoided. It’ll also teach you how to create a unique retirement lifestyle that’ll work for you.

Once you decide which book you’d like to read—you can read all three if you like—email me at michael.drak@yahoo.ca and I’ll send you an electronic copy. The rest is up to you.

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Back to Work

CALL IT THE GREAT unretirement. Hit by rising living costs and unexpected feelings of boredom, one out of eight retirees plan to return to work this year, according to a recent survey.

I’m one of them. Two and a half years after retiring from the corporate world, I’m headed back to work. I’ve accepted a position as lead writer for the CEO of a Fortune 200 technology company. I’ll be writing the CEO’s speeches, board letters, and internal and external communications, while working with the firm’s marketing team to shape her public image.

You may ask why, at age 64, I’d want to give up my newfound freedom to jump back on the corporate hamster wheel. Well, it should be noted that my new gig is part-time and also a contract role, which should give me the flexibility to continue doing the things I love, like blogging, writing books and fly fishing. I’ll also be a sole contributor, and not managing a global team of professionals, as I did during my 30-plus-year career.

Still, I recognize that there will be some weeks when I need to drop everything to take on a pressing project. It comes with the territory. Are things really that bad for me financially that I need to go back to work?

Not really. Yes, inflation is taking a big bite out of my budget, as it is with other retirees. I’m also getting remarried in October and am being hit by a lot of big wedding-related expenses. But with the stock market at all-time highs, my investment portfolio is doing fine and I still have a decent-size cash position, despite drawing from it over the past two and a half years.

The bigger reasons I’m going back to work are personal in nature. They’re things I’ve learned about myself since I stepped away from my corporate management job in 2021.

1. I like to work. I’ve been surprised by how much I’ve missed work. I’m not talking about the meetings, the politics or those useless performance evaluations—sorry, HR—but rather the actual work of setting an important objective and going about accomplishing it. I estimate that, during my corporate management career, I spent upward of 80% of my time doing stuff in the former category. Now, as a contractor, I can focus on the actual work, which is the stuff that gets me energized and, I suspect, most other people as well.

What can I say? I’m not one to sit around. I’m not a golfer. I’m not much of a joiner. My fiancée is 12 years younger than me and still working, which means that most of the week I’m on my own. I don’t have an interest in traveling by myself, and there’s only so much fishing and personal writing I can do. Why not do meaningful work and get paid for it?

2. I like a challenge. As a results-driven person, I have a deep psychological need to achieve and make good use of my God-given talents, such as they are. As much as I’ve tried to temper my type-A tendencies over the past couple of years, I haven’t been able to do it. I feel like I still have a lot to offer the world and I'm not ready to be put out to pasture.

This new position offers me that kind of challenge. I’ll be working with a young, incredibly smart CEO who is leading a turnaround at one of the biggest fintech companies in the world. My job will be to help her tell her story in a way that energizes employees and differentiates the company in the minds of customers and Wall Street. It’s a job that, if done well, could have a tangible impact on the company’s stock price. That’s pretty exciting.

3. I like having money coming in. I’ve been living a rather minimalist lifestyle over the past two-plus years, doing my best to subsist on my savings and a small monthly pension, while holding off on withdrawing from my retirement funds or taking Social Security until I reach my full retirement age of 66 and 10 months. I think I’ve been doing a pretty good job of it overall—witness the relatively minimal drain on my cash savings—which is satisfying at a certain level.

But even minimalism can get old after a while. I miss the ability to splurge on things the way I could when I was working full-time. For instance, I’ve always wanted to have a hot tub at my mountain house to soak my aging joints. I would also like to help my adult kids with some of their financial needs and ratchet up my charitable contributions. This part-time contract role will allow me to do that, with—I hope—minimal sacrifice of my freedom.

Life is short. There’s no sense scrimping if we don’t have to.

4. I miss the work world’s camaraderie. This was also a big revelation to me in the time I’ve been away from the corporate world. Blogging and writing books are, by their nature, a solitary business. I spend the bulk of my days in front of the computer, creating story worlds from the contents of my head.

As much as I like my solitude, it can get old after a while. I miss the day-to-day connections of working with people and collaborating with them toward a common goal. As one of my first tasks in my new job, I flew out to the company’s headquarters for a week-long set of meetings to help the team craft communications for an upcoming event. It was a lot of fun to be sitting at the table with super-smart corporate professionals, talking business and helping them tackle a big challenge.

5. I enjoy the dopamine rush of seeing things come to fruition. The rewards of being an author are few and far between. First, writing a book takes a long time. I’ve been researching and writing my multigenerational novel, Unto the Mountain , for three years, and it’s only now getting to the point where it’s good enough to send to agents and publishers. What’s more, for all the work that goes into a book, there’s no guarantee it’ll get published or, if it does, ever make any money.

Writing for the corporate world, on the other hand, has instant rewards. There’s the money, of course, but there’s also the dopamine rush of seeing a project come to completion and getting positive feedback from executives and colleagues. That’s important—to me, at least.

And so, hi ho, hi ho, it’s off to work I go. How long will I do it for? Who knows? Life’s a journey and I’m looking at this as another adventure. I’m taking it one day at a time, while making sure I thoroughly enjoy the ride.

Author and blogger James Kerr is a former corporate public relations and investor relations officer who now runs his own agency, Boy Blue Communications. His debut book, “ The Long Walk Home : How I Lost My Job as a Corporate Remora Fish and Rediscovered My Life’s Purpose,” was published in 2022 by Blydyn Square Books. Jim blogs at  PeaceableMan.com . Follow him on Twitter  @JamesBKerr  and check out his previous  articles .

The post Back to Work appeared first on HumbleDollar.

Billionaire Next Door

JOHN D. ROCKEFELLER was the richest man in the U.S. in 1918, which happens to be the year my father was born. His $1.2 billion net worth at that time would have the buying power today of more than $24 billion.

Rockefeller, with his massive wealth, could purchase things most of us can only dream about, such as sprawling estates and gigantic yachts. Still, in many ways, today’s millionaire next door has more purchasing power than this billionaire of yesteryear. Consider the things that Rockefeller—despite all his riches—couldn’t buy at any price in 1918:

Internet access. Personal computers didn’t exist in 1918, let alone the internet. Today, we regular folks have access to an almost infinite array of knowledge, news and entertainment. Trillions of dollars of technological development since Rockefeller’s time have made this marvel possible.

Modern vehicles. Rockefeller had a collection of automobiles, but nothing he owned could come close to the performance, comfort and reliability of today’s vehicles. His cars weren’t equipped with power steering, anti-lock brakes or even air-conditioning—which debuted in 1940. Vehicles in 1918 were subject to frequent breakdowns, causing inconvenience even for rich people.

Cutting-edge health care. Medical science has advanced exponentially since 1918. Despite having what’s been termed a nervous breakdown in his early 50s, Rockefeller generally seemed to enjoy good health. Still, had he suffered from any serious health issues, the medical help available to him would have been far less advanced than what most Americans have access to today. If his appendix had ruptured, like mine did early in life, he likely would have died.

Entertainment options. The motion picture industry was in its infancy in 1918. Rockefeller died in 1937. Blockbusters like The Wizard of Oz and Gone with the Wind were released a couple of years after his death. Today, just about everybody—in their own private home theater—can watch these movies and thousands more that were never available to our billionaire.

Rockefeller had a deep love of music. I hope he preferred getting his music fixes from live performances. The fidelity of music played on the scratchy phonographs of his day was far inferior to that from even the low-end stereo systems of our time.

Portable telephones. Not only did Rockefeller never have the opportunity to use a smart phone, he also didn’t have access to any kind of wireless phone network. Only about a third of U.S. households had phones in 1918. If Rockefeller wanted to call one of them, he would have used his landline and gone through an operator.

Jet travel. Today’s billionaires often own private jets. This wasn’t an option for Rockefeller. In fact, with all his money, he never took a single flight on a jet plane—they weren’t invented until after his death. Commercial jets weren’t in use until the 1950s.

What should we make of all this? We enjoy amazing material advantages simply by virtue of being alive at this time in history. We have many phenomenal options not available to the richest man in the U.S. a century ago.

Still, I don’t think our increased purchasing power and exponential increase in choices have resulted in a corresponding increase in life satisfaction for most people. Mental health problems are skyrocketing, as are deaths of despair. It’s not hard to find numerous examples of ultra-wealthy entertainers or sports figures living miserable lives. Often, it seems that a contented celebrity is the exception.

Some of this apparent paradox can be explained by hedonic adaptation. When I purchased my first computer with internet access in 1997, I was enthralled for months. I would stay up late surfing the web and exploring the wonders of cyberspace. Of course, I had a painfully slow dial-up connection, but that was just the price of admission to this exciting new online world. A year later, I still enjoyed my computer, but the initial thrill was gone. Today, my computer is an important tool, but one I usually take for granted—unless, that is, my high-speed internet connection goes out.

I’ve had a lifelong interest in radio. Before television and computers became widespread, radio was the most popular means of delivering news and entertainment. The 1930s are considered radio’s golden age. I’ve listened to some old-time radio shows and found them very entertaining.

My family listened to an excellent modern radio program called Adventures in Odyssey when our children were young. I strongly suspect that a family gathered around the radio to listen to a show in the 1930s was more entertained than people today flipping through endless TV channels and TikTok videos.

In his 50s, at the height of his empire-building efforts, Rockefeller was a depressed man afflicted by digestive troubles. After he stepped away from running his businesses and started focusing on philanthropy, it seems his health greatly improved. He lived to a ripe old age, passing away shortly before turning age 98. Could it be that true riches are quite different from what’s conventionally considered wealth?

Ken Cutler lives in Lancaster, Pennsylvania, and has worked as an electrical engineer in the nuclear power industry for more than 38 years. There, he has become an informal financial advisor for many of his coworkers. Ken is involved in his church, enjoys traveling and hiking with his wife Lisa, is a shortwave radio hobbyist, and has a soft spot for cats and dogs. Follow Ken on X @Nuke_Ken and check out his earlier articles.

The post Billionaire Next Door appeared first on HumbleDollar.

March’s Hits

WHAT WERE FOLKS reading on HumbleDollar last month? Here are the 10 articles and blog posts that garnered the most pageviews during March:

"During our working years, the usual goal is to minimize our tax bill each year," notes Adam Grossman. "But in retirement, the objective is different: It’s to minimize our total lifetime tax bill."
"Perhaps the key to my happy retirement was not planning what I’d do in retirement," says Dick Quinn. "Don’t try to plan your way to contentment. Just grab every opportunity that makes you happy."
Retirees must confront a slew of risks, including family financial demands, failing health, inflation, scams, overspending and market downturns. Sundar Mohan Rao lists just nine of the perils that seniors face.
Want a successful retirement, financially and otherwise? Dan Haylett says the key might be continuing to work full-time or part-time—for seven compelling reasons.
What's the most important thing to do financially? As Adam Grossman explains, it depends which season of your financial life you're in.
Why make extra-principal payments early in a mortgage's life? No, it isn't because you earn some extraordinary annual return. Rather, it's because those payments can bring hefty financial relief at the end of the loan.
Should you aim to leave your children an inheritance? As Dick Quinn discovered, many folks consider that a bad idea.
"We might find ourselves alone one day, with no trusted acquaintances close by," notes Dennis Friedman. "Getting a financial advisor on board now seems like a wise move."
Intrigued by qualified charitable distributions? Chris Cagle explains how they work—and what they meant for his 2023 tax bill.
"Recency bias causes us to look backward—to assume that what happened yesterday will happen again tomorrow," notes Adam Grossman. "That can lead investors to do the opposite of what would be best."

What about our twice weekly newsletters? The most popular Wednesday newsletters were Lucretia Ryan's What Advantage and Jeff Actor's Farewell to Forever, while the best-read Saturday newsletters were Asking Myself and Comfort Has a Cost, both written by me. Don't get our free newsletter? You can sign up here. We also put out a free daily email alert about the site's latest articles, which you can sign up for here.

The post March’s Hits appeared first on HumbleDollar.