I keep seeing endless news stories and statistics about ruined retirements. Reading them is discouraging. It makes it sound like all of us are going to be dining on kibble, and I don't think that's true. So, I want to tell you about my neighbor, Jim, who is a savvy retiree who has figured out how to live comfortably, despite being forced to retire early and losing some of what he potentially would have earned had he been able to work until he was older.
I think his retirement planning strategy is instructive and encouraging to the many people who are finding themselves in a similar situation.
I live in Detroit, where the car companies have forced thousands of people into early retirement. In my neighbor Jim's case, the financial package was adequate, but it included the supposition that Jim would take Social Security at 62. Doing that would mean that he and his wife were going to always have to watch their pennies. So Jim looked for ways to augment his retirement income and put off filing.
My neighbor has always been good at managing his own property, maximizing curb appeal and ensuring that the place is the best-looking house on the block. Based on those home-maintenance skills, he launched a property-oversight business, targeting people who are either too busy or not sufficiently healthy to manage their own properties. For a flat fee, Jim will oversee outdoor maintenance, including arranging for repairs and lawn care. If the homeowner is traveling, for an additional fee, he'll check inside to make sure the property is secure and the furnace, security system, refrigerator, etc., are all working properly in the homeowner's absence.
He doesn't do any of the actual tasks himself; he arranges to have professionals do the work and sees that they do it right. Last year, he earned $17,000 in fees and commissions. This year, he expects to make more. Since the value of Social Security increases about 8 percent per year between 62 and his full retirement age, 66, Jim is giving himself a 32 percent raise by waiting. Plus, the business is one that should he choose, he can continue doing for many years, adding significantly to his lifestyle and retirement nest egg.
I think it's a brilliant retirement planning strategy and one many people, including myself, could emulate and stave off an all-kibble diet.