Tag Archives: personal finances

The Secret to Creating Your Golden Years

Looking forward to your golden years? If you did 20 years of military service you will get there, likewise if you were diligent about saving and investing. Otherwise, join most of the rest of Americans throughout history whose retirement plan was very different. You might reasonably ask how this can be when the World War II and Korean War generation is having a relatively prosperous retirement. Consider the following:

The Secret to Creating Your Golden Years

People who are at least 70 lived through one or more of three of the most harrowing events in American history: the Great Depression, World War II, and the hot part of the Cold War – the Korean War. You would have to go back to the Civil War, almost a century before, to find a time when an entire generation of Americans collectively suffered so much.

These hardships had a profound effect on the behavior and values of what has come to be called the Greatest Generation. They matured quickly, married and started families young, climbed out of the depths of worldwide destruction by striving for and achieving a comfortable life. No generation since has suffered as deeply nor had the need to rebuild a shattered world. Neither the Vietnam War nor the worst post-World War II economic period, the recession of the early 1980s, compare.

Robust economic conditions coupled with a baby boom created the circumstances in which companies could offer defined benefit pensions and government entitlements had a broad enough tax base to support them. However, between 1979 and 2011, private sector workers with defined benefit pension plans declined from 31% to 3%. When first started in 1940, Social Security had over 35 million workers paying into a system that had fewer than 250,000 recipients, a ratio of 159:1. By 1960 that ratio had dropped to a still sustainable 5:1. Since 1980 the ratio has been in the range of 3.3:1 but in 2010, as the first Baby Boomers began to retire, it dropped to 2.9:1 and appears to be continuing down.

During the period from 1945 to 1970, there were 50 months of recession and unemployment rates were as high as 7.5%. During the next 25 years, although there were only 42 months of recession, the lowest recessionary unemployment rate was higher than the highest one during the previous 25 years and peaked at 10.8%. At the same time the birthrate has fallen to historic lows.

Together, these two trends spell the end of any chance that Baby Boomers and beyond as generations will be able to retire. While you might find this upsetting, in reality it is the World War II and Korean War generation that is the anomaly. The vast majority of people in the 19th and early 20th centuries worked through their lives to support themselves.

As you plan to live intentionally, I encourage you to take this reality into account, especially if you do not have a government pension or are not diligent about saving and investing. The good news is that it is beneficial to keep working since you will have a longer, healthier life as a result. For you, the good life means living a life you have planned for yourself. Intentionality will replace the ideal of the golden years.

Question – What are your plans for retirement? Please respond below.

How to Achieve Better Health and Financial Well-Being

“When you have your health, you have everything. When you do not have your health, nothing else matters at all.” Augusten Burroughs

When you decide to live an intentional life, like most big changes typically the difficult part can be getting started. As I mentioned in my previous post, How to Get Your Life Moving in All Areas, I recommend you begin with fitness in the physical pillar. Progress toward goals in this area can be made quickly. Moreover, it is difficult to focus on mental and spiritual fitness when you are concerned about your health or financial matters.

How to Achieve Better Health and Financial Well-Being

The physical pillar of fitness comprises three realms:

  1. Health – Sleep | Diet | Exercise
  2. Finances – Cash Flow | Debt | Investments
  3. Play – Recreation | Hobbies | Entertainment

First, you need to assess where you currently are with respect to each realm. Some questions are:

  1. How much sleep do you get?
  2. What is the quality of your rest?
  3. How is your health?
  4. When was the last time you had a complete physical?
  5. What is your exercise program?
  6. What do you eat on a regular basis?
  7. How much income do you receive from salary, interest and investments, pensions, etc?
  8. What are your expenses?
  9. What preparations have you made for the future: emergencies, buying a house or car, retirement, etc?
  10. What activities do you engage in to relax?

These questions are designed to get you started. As you delve into this pillar you will think of others. You may need to consult with professionals, such as your doctor or financial planner. Chronic or debilitating conditions will complicate your plan to live intentionally, but need not derail it. Next gather sufficient information from reliable sources on such issues as sleep, diet, exercise, personal finances, and hobbies, so that you are comfortable making decisions about your life direction in each realm. Some of the resources I use are:

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Now, start setting goals. Three to five is generally the most you can work on at one time.  For example, you may be trying to get by on four hours of sleep a night but numerous studies show that seven is the minimum amount most adults require. If you want to lose weight, have more energy during the day, be able to work with greater focus, and have more patience with your spouse and children, being properly rested is crucial. So an excellent goal is to get seven hours of sleep a night.

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The essential tool for achieving goals in the physical pillar is self-discipline. Sleep disorders aside, getting the rest you need is a matter of being disciplined about the environment in which you sleep, the preparations you make before bedtime, the time you go to bed, and the time you wake up. It takes 21 days to ingrain a new habit but you should notice a change after as little as a week, perhaps less.

The state of your health, physical condition, finances, and play is essentially a factual matter, The path to improvement is well defined. Because you can control what you say and do it is within your power to improve your physical fitness. You are on the way to building your first solid pillar.

Start right now: Set your first goal toward better fitness in the physical pillar. If you have questions leave them below or email me and we will work together.

Question – How do you build self-discipline?

You can leave a comment on this question or ask another question below

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