Some people have work pensions that, as I understand it, will provide them reliable revenue until they die. These people are, in my opinion, smart and forward-thinking. They chose their careers well.
Many people I know (myself included) are not part of this group. What were we thinking? That pensions and benefits were only of concern to old folks? That we’d make so much money, retirement finances would never be a concern? While some had vocations or passions they had to pursue regardless of practicalities, I simply didn’t think about such matters in my early adult years. Silly me.
Neither Jay nor I had/have work pensions. Fortunately Jay had contributed to RRSPs throughout his career. These now constitute my savings – not enough to live in luxury, but enough to live on for many years IF the stock market doesn’t plummet, and if I live modestly. In this I am lucky; many people do not have that level of retirement security. (Some despite their best efforts: they thought they had work pensions until the companies they’d loyally served for most of their lives declared bankruptcy. I can only imagine how that would feel).
Right after retiring, I became panicky about money. I eliminated things of no real importance to me (cable TV, landline phone) and became vigilant about every penny I spent: doing laundry only at off-peak times, rabidly turning lights off when not in use, limiting my phone usage (I only have 200 free anytime minutes per month. Don’t call me during work hours on weekdays!), doing tasks myself that I might have paid someone to do (except painting… hate painting), and cutting way back on entertainment (shows, restaurants, etc.). I don’t buy a lot of anything (e.g. clothes – and that may show). I do like to travel, and I have to maintain my home, car, computer – the basic, not inexpensive stuff – but I have no debts and no dependents, so really I should be okay.
The question is: How long will I live? In theory I have enough funds to live until I’m 90, which seems more than long enough to me. But I spend a ludicrous amount of time every month calculating how much I can afford to spend without running the risk of depleting my funds too soon – and I never feel at all certain my conclusions are valid (math not my forte). Still, I THINK that if I am careful, I could probably live to 100.
But if I am careful, I won’t have any fun. I’ll be scrimping and saving and trying to cut costs, just to make ends meet. And I could drop dead tomorrow, with all that money unspent.
It’s a conundrum.
In the end (well, until next month) I have decided I should be more indulgent now, especially re. travel, since a) I don’t know how long I will live, and b) in 15-20 years I will have less energy, and less desire to travel – so my expenses will be lower. In other words, I can afford to live it up a bit at the moment.