Financial Literacy 2007 - Retirement
Jennifer Openshaw
Interview: Jennifer Openshaw

My research found that there are 9.3 millionaire households as of 2006, a whopping 50 percent increase from 2003, when there were just 6.2 million millionaire households. That's fast enough to make your head spin! And more importantly, it means it's truly possible for any working American to accomplish the same. The good news is that a large percentage of these wealthy Americans are achieving success by starting their own businesses. I talk to so many Americans who are hitting the millionaire zone right out of their homes with as little as a couple thousand dollars by taking an idea and turning it into a business. The beauty of the Internet is that you can start a business without hiring employees or spending thousands on brochures. The world is truly a level playing field now and anyone can get in: You can find inexpensive resources across the globe. You can start marketing online to others or through eBay -- the possibilities are endless and people are doing it at every age and stage of life. So many people ask me, "Jen, what's the best way to get started?" Well, I believe you should start with your passions. In my book, I offer a 30-Day Getting Started Program that helps you identify those profitable passions and start making it happen.

Finally, if you're putting money in the stock market, don't let it sit in a money market or other cash account earning maybe 5 percent. That's one of the biggest mistakes Americans make. You've got to put it to work. And one smart strategy is to again pay attention to your "LifeNet" and find those investment opportunities right in front of you. For example, when you find out that because of a local strike at your grocery store, everyone is shopping at the local Whole Foods. Pay attention. The trend for organic foods continues to explode -- a friend of mine doubled her money by just paying attention to that. Or, you're in the parking lot of Big Lots and notice how full it is. We as buyers have a lot of information that can be used to make smart investment decisions and grow our money faster and with far less in fees than mutual funds.

q_v2.gifWhat are some other common misconceptions people have about saving enough money for retirement? What kinds of expenses should they factor in to their retirement needs?

a_v2.gif We think we'll be able to get a job in our later years when studies show that that is often not the case --  either because we'll face an illness or other issue preventing us from working or companies just won't be hiring us.

Also, we expect health care benefits to be there when, sadly, corporate America is pushing more of those costs onto workers. As for Social Security, well, those checks will keep you in the poverty house at best. Perhaps most importantly, we think of retirement as the end of our working life rather than a new beginning. Let's think of what we will be retiring to, not retiring from. The opportunities and the way we live our life are endless -- maybe it's time to do something you're truly passionate about or which has a social purpose that motivates you like never before.

Either way, we've got to plan for our expenses during retirement. Among the most important are housing, health care (both insurance and out-of-pocket), food and transportation, followed by the fun stuff like travel. Typically, you should assume you need 70 percent of what you're spending each month today. It could be less if you're willing to lower your housing costs, or more if you plan on living it up.

Most people are afraid to even think about what they need during retirement because they know the picture is pretty bleak. You've got to turn that thinking around.

You've got to do it for your own financial security and that of your family. And the best way is to think about it in a positive way: How can I make the most of my money? That's what "The Millionaire Zone" thinking and way of life is all about: Building your wealth by tapping into the things with which you're already familiar. Oprah is a wonderful example of the philosophy that it's better to use what you know than "go it alone." She tapped her best friend Gayle King to run her publishing empire. Not only is she critical to Oprah's success but she also provides emotional support through their late-night phone calls.

q_v2.gifYou've written about the importance of planning for private health insurance after retiring. Would you explain why it's essential and share tips on how to stay insured?

a_v2.gifWe just can't expect that corporate America or Uncle Sam will take care of our health costs into old age. In my book I talk about a man, Carlos, who was afraid to leave his job because of his health benefits. What Carlos didn't realize is that he was paying more than he thought for he and his wife's medical needs even with his company benefits. In fact, his insurance and prescription costs ran him $1,200 a month! Carlos's thinking about his so-called great health benefits prevented him from making changes -- like starting his own business -- that could have put him in greater control of his financial life.


What Americans don't realize is that today we are paying about 22 percent of our health insurance premiums versus just 14 percent in 1992. That's just the premiums. And it's going to get much worse.

To make sure you stay insured, first, never leave a job without having insurance in place. If you are thinking of leaving, work with an independent broker who can look into group insurance plans. Group insurance plans can lower your costs, especially if you have pre-existing conditions, since the risk is spread out over a group. Also, many states have special programs for people who cannot get insurance otherwise due to pre-existing conditions. Check your state's insurance department.

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