The Wealthy Retiree
Quaero, the handyman at a local senior living complex, was thoroughly discouraged as he flipped violently through the Sunday paper. His wife, Maria, sensed something was wrong during their normally peaceful Sunday breakfast together.
“What’s the matter?” she asked concerned. Quaero’s eyes narrowed as he screwed up his face to answer, “I guess retirement’s not gonna happen any time soon.”
“What makes you say that?” Maria replied.
“Have you seen the headlines recently? The market is all over the place, bonds and cash are not paying anything, and our house has fallen in value dramatically. There’s no way we’ll be ready in four years.”
Quaero, now 58 years old, had planned to retire when he turned 62. Maria had no words of comfort for him. She knew he was right. Their normally relaxing breakfast was overshadowed by the specter of a career with no end in sight.
The next day at work, Quaero was repairing the sink for one of his residents, Will Pecunious. As Quaero completed the project and was cleaning the counter, Will handed him a crisp, new $100 bill. It was well known throughout the community that Will had money. He spared no expense on any aspect of his life. Quaero loved to be called to Will’s apartment for repairs. Despite the fact that the repairs were covered by his rent, Will was always a generous tipper.
“Wow, thanks Mr. Pecunious!” Quaero blurted out excitedly. “That is very generous, but I can’t accept it. It’s too much. The repairs are covered.”
“I know, Quaero, that’s your tip.” The old man fired back.
Quaero’s mind wandered back to the conversation he had with his wife the previous morning. He was growing curious as to how Will had become so wealthy. “Mr. Pecunious, what did you do for a living?”
“Please, call me Will. I was a janitor at the high school.” Will replied with pride.
“A janitor!” Quaero couldn’t believe his ears. “Wow, did you win the lottery or something?” he asked as he chuckled.
“Nope” Will said, now with a cryptic smile on his face. It was obvious he was going to make Quaero ask.
“I don’t get it. How could you have been a janitor and be doing so well for yourself?”
“I was smart with my money, especially in retirement. When all my friends were making big mistakes, I avoided their knucklehead moves.”
“Really, that’s the secret to your success?” Quaero replied stunned.
“It’s really that simple.” Will said with an air of self-confidence.
“Can you help me?” Quaero asked rather excitedly. “I’m supposed to retire in 4 years and I don’t think it’s going to be possible”.
“Whether it’s possible is up to you, but I would be happy to tell you my secrets of retirement success. In exchange, I want you to do something for me.”
“Anything, just name it!” Quaero jumped at the chance.
“Each week I will teach you one lesson about retirement; in exchange, I want you to bring me a sandwich from ‘D’Angelo’s’, the deli on the corner. I’ll even pay for it.”
“I’m not sure if I….”
“It is what I require for my services” Will insisted. “The nurses in this place won’t let me eat real food, and I’ve had it with Jello.” Quaero peered into the old man’s clear blue eyes with a strained look. Will, as if reading his mind, spoke quickly, “I’m 83 years old…what exactly is in a sandwich that is gonna kill me at this point?”
“Alright, it’s a deal.” Quaero accepted his logic reaching out to shake his hand.
“Great, we’ll start tomorrow with lesson #1, ‘It’s not what comes in’. Be here at 3:00.”
“I will and thanks for the help” replied Quaero as he turned and walked through door and down the hallway. For the first time in a very long time, he was excited about his financial future.
Next Issue: Lesson #1: “It’s not what comes in”
Don’t want to wait for lesson #1? Read Will’s first lesson to Quaero now by visiting www.ZynergyRetirement.com
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The Wealthy Retiree
Quaero awoke early Tuesday morning. It was perhaps the first time in 20 years that he felt a sense of exhilaration at the thought of beginning his work day. Today was the first day in a series of lessons from the wealthy retiree, Will Pecunious, a resident of the senior community where Quaero worked. Will had offered to teach Quaero the secret of his retirement success in exchange for a sandwich each day. It seemed like a good deal to Quaero.
The hour had finally struck three and with much anticipation, Quaero arrived at Will’s apartment. Quaero knocked on the door clutching the D’Angelo’s roast beef and cheese sandwich. There was no answer. He knocked again but this time he could hear rustling behind the door and the turning of the deadbolt. Will opened the door with an infectious smile on his face, “You made it!” he greeted Quaero with a firm handshake. “I was getting worried you would back out of our deal,” he said with a wink.
Quaero thought to himself, not on your life and handed Will the bag, “Here’s your sandwich, roast beef and cheese, just like you asked. Will’s eyes grew as big as saucers as he snatched the brown paper bag from Quaero’s hand, opened the top and stuck his nose in to take a long whiff. “Ahhh, I’ve missed that smell. Finally, something to eat besides rice pudding.”
“Are you ready for your first lesson?” Will asked as he slowly shuffled over to the kitchen table.
“You bet!” Quaero responded excitedly. “What did you mean yesterday when you said, ‘It’s not what comes in?’
“Lesson number one is a simple one, my boy,” Will replied as he laid out a placemat, ceramic plate, linen napkin, and opened his sandwich. Quaero chuckled to himself noticing that Will seemed to be preparing for a five course meal. “It’s all about what you spend, not what you make! Whether you’re retired on a fixed income or have a young family and are just starting out in life, you can build and maintain wealth by controlling what you spend.” Will finished as he took a giant bite into his sandwich.
“Quaero, I’ve lived a long time and have watched a lot of people make both good and bad decisions with their money. Our neighbors, John and Betty, who retired the same time as my wife and I, could comfortably live on $150,000 a year and spent themselves flat broke. They were always talking about how they deserved this trip to Europe or that expensive car. It wound up costing them their financial security and freedom. Ultimately, John had to return to work at the age of 78 earning $12 an hour to make ends meet.”
“On the other hand, my best friend, Rick and his wife retired on $40,000 a year and continue to grow their assets and live a very comfortable lifestyle by simply living below their means. They are frugal and very smart with their money. They travel to Europe, like John and Betty used to, but they put together a large group so they get to go for free. Using their time, creativity, and a little forethought, they have managed to live the lifestyle of someone bringing in three times the income and don’t lose a wink of sleep over their finances. The choice is yours, Quaero.”
Quaero nodded in agreement. “I think I get it. So, whatever my income is in retirement, I need to live on less than it. Seems kind of obvious, don’t you think?”
Will paused, swallowed hard, and smiled, “Most of this stuff is. It’s common sense. But as the old saying goes, ‘Common sense ain’t common’. I have seen so many of my friends retire with a sense of entitlement. They feel that they worked so hard for so long, that now they are owed this or that. What you are owed is a worry free and comfortable retirement, not some beach house or sporty convertible.” Will was now getting loud, indignant.
“You’re right, Will. Maria and I have really always tried to live below our means. I think that’s why we are even contemplating retirement while most of our friends have resigned themselves to the fact that they will be working until the day they die.”
“Glad to hear it, you’re off to a good start and well ahead of most of your counterparts. I believe that if you follow Rule #1 but ignore every other thing I am going to teach you, you will be financially secure.” Will replied with his mouth full as he chewed. “Your assignment tonight is to go home and talk it over with Maria. Make sure you are both on the same page and she understands the importance of living below your means, especially in retirement. Tomorrow, come back at the same time for Lesson #2. We will be talking about exactly how much that number is. This will help you decide when you are going to be ready to retire. You see Quaero, when we first met I said it was up to you when you could retire. It depends on exactly what kind of lifestyle you want to live. Tomorrow I can show you how to decide if you’ve achieved enough savings to meet that lifestyle.”
“That’s great, Will. I think I will like tomorrow’s lesson”
“And I think I will enjoy the chicken parm sandwich you will be bringing me” Will replied with a wink and a smile as he polished off the last of the roast beef, licking his fingers.
“It’s a deal. See you tomorrow, Will. And thanks!”
“Have a great day” Will replied as Quaero headed out the door with a wave.
Next Issue: Lesson #2: “How much can I spend?”
Don’t want to wait for lesson #2? Read Will’s second lesson to Quaero or any of the previous articles now by visiting www.ZynergyRetirement.com
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Ryan P. Zacharczyk, CFP®, MBA, CRPC is a Certified Financial Planner™ and President of Zynergy Retirement Planning, LLC. Located in Red Bank, New Jersey, Zynergy provides fee-only comprehensive financial planning services primarily for individuals 50 and older. Ryan has almost a decade of Wall Street experience as a trader and risk manager. He is a board member with the Eastern Monmouth Chamber of Commerce and the President of Kiwanis of Greater Red Bank. He currently writes on financial topics for “Currents” and “Dummies.com.