A friend was discussing the transition from becoming an “empty-nester” (children leaving home) to bridging the gap to retirement. Like many in their mid-lifer’s, mortgages and debts remain, and the retirement projections fall woefully short of being able to retire until they are in their late 70’s – if at all.
He echoed the common sentiment – “I need to plan better, spend less and save more. I just never seem to be able to get it done.”
I sent him an article with some suggestions. A few weeks later, he thanked me, saying, “I’ve read part of it and have to get back to it.”
That shocked me! I target 1500-1600 words – which researchers suggest is a five-minute read. If I failed to get and maintain his attention, the message was never received….
I began researching and WOW! Conifer Park published some amazing statistics:
“Top 10 Key Average Human Attention Span Statistics & Facts
1. The average human attention span is 8 seconds.
2. In 2000, the average human attention span was 12 seconds.
3. The attention span of a goldfish is 9 seconds.
4. 50% of people can’t focus on a task for more than 8 minutes.
5. 75% of people forget names within seconds of hearing them.
6. 60% of people can’t go 10 minutes without checking their phone.
7. The average person checks their phone 150 times per day.
8. The average person spends 3 hours and 15 minutes on their phone per day.
9. 70% of people use their phone during meals.
10. 29% of people can’t go 30 seconds without checking their phone.”
A goldfish has a longer attention span than a human being! I began “observing” in restaurants. The cell phone statistics appear outdated, people are checking them constantly, while ignoring family and friends at the table. Teenagers just can’t seem to put them down.
Each week I try to make suggestions. I love it when readers make time to drop me a note saying they followed the advice or forwarded the article to friends and family offering suggestions. Each week I hope some readers will flip a switch and become motivated and do what is necessary to prepare for their future.
What are we trying to accomplish?
The goal is to change behavior. Most are familiar with the old joke:
“A farmer hitched his mule to the plow and the mule wouldn’t budge. He walked around in front of the mule and smacked him on top of his head with a board. The mule immediately began pulling the plow.
When asked why he whacked the mule, the farmer replied, ‘I love this old mule, he works hard, but sometimes I have to get his attention.'”
While step one may be getting their attention, the message has to be understood and provide motivation to get the job done. A challenge in today’s world.
Motivation by itself energizes incompetence. Knowing what must be done, and how to do it, is the next challenge. Building a plan, and sticking to it – changing behavior – staying focused on the goal, not getting emotionally sidetracked requires self-discipline. It’s not like a temporary diet; behavior has to change.
The closest version of whacking with a board I can use is
OK LISTEN UP! PUT YOUR PHONES DOWN AND PAY ATTENTION….
No frills, I’ll try to tell it like it is….
If you want to retire comfortably, and not worry/work until you drop, here is how thousands of middle-class people have made it happen.
Change your perspective. There are dozens of studies differentiating how wealthy people versus middle class view money. Most of the middle class looks at money in terms of “stuff” – things money can buy. Wealthy people view money in terms of financial and emotional freedom.
“Wealth begins with a mindset before it begins with a bank account.” — George Mrihe |
Does your want/need for more stuff surpass your need for the freedom from having to constantly worry about money for the rest of your life? Think about that for a moment….
Use your free time wisely. Studies also show the middle-class reads novels, tabloids, and entertainment magazines. They prefer to use their cell phones and media for entertainment.
Rich people use some of their free time for education, ahead of entertainment. Allocating an hour each evening to learn about investing will pay off more quickly than you realize – much better than funny videos used to pass the time before bed.
Run the numbers and find out what’s lacking. You want to target a “magic number” in retirement savings by a certain date. If they don’t add up is it because of lack of income or improper savings? Both need to be addressed.
If you are not earning enough money, what can you do to improve your skills and earn more? Can you turn your hobbies into part-time income? Increased income can be invested and compounded over the years which really helps.
Learn to invest wisely. You can earn money two ways. Working your butt off and earning it. Interest is rent being paid for someone else’s money. Bankers get rich for a reason. Become your own money landlord; let others pay you to use your assets. The sooner you can have investment income growing, the closer you are to financial/emotional freedom. That is called working smart.
Control your spending. If you are on a debt treadmill, constantly spending more than you make you are doomed to a lifetime of economic slavery and constant worry.
If you don’t have the money, don’t buy it! How hard is it to understand the one thing you can immediately control is your spending? If you are up to your eyeballs in debt, it’s because of choices you made. You dug the hole, now make smart choices and find a way out. You never learn how to manage money until you don’t have any.
How soon can you pay your home off and get out of debt? Compare that cost to your earnings estimate. If you don’t have much left over, find ways to earn more and don’t waste money on things you don’t need.
Understanding the difference between needs and wants is a major step.
Get out your checkbook and credit card data for the last year. Make a list of where your money went. How much “stuff” did you buy that you really don’t need? Quit dumping your car or electronics when the old one works fine. Upgrade your phone every 3 years, why not 6? You just saved $2,000 or more. A major milestone is when all the payment booklets are cut up and trashed.
I’m a lifelong Chicago Cubs fan. The bleacher beer snakes are legendary. Currently the cheapest beer is $13. Some of the beer snakes reach from the bottom to the top of the bleachers, a whole lot of very expensive “entertainment” money for a three-hour ball game.
Saving is catching up. Saving is spending less that you earn. Any questions?
When you are working you trade time for money. When you retire you trade money for time. If you want to retire at 65-70, you need enough money to live for 25 years or more. Don’t wait until you are 60 before you start thinking about it. If you begin a regular saving/investing plan early on you will have plenty of retirement money. It is a matter of priorities….
Maximize your IRA and 401(k) contributions. If you don’t see the money, you won’t spend it. Save even more. Take $2,000 out of your checking account and invest it. Now enjoy a nice dinner, you just saved $2,000. Make it fun. Set savings goals, increase them yearly, then celebrate. Sure, you may have less “stuff” but who needs it? The trade off is stuff versus financial/emotional freedom. Which is more important?
The epiphany moment!
We can cite statistics about people’s attention span; however, my experience paints another story.
When the student is ready to learn, the teacher shall appear.
At the time I became an empty-nester, I also divorced. I was starting over in many ways. Much like my friend, I knew I had to do something. The emotions of day to day living got in the way. Too many spur of the moment decisions to buy stuff kept happening; I wasn’t making any progress. It began gnawing at me. For several months I woke up worrying in the middle of the night.
I discussed my feelings with an older mentor/friend. He had felt the same way. He finally decided to change his outlook; “Pay yourself first and learn to live on the rest.” Once he started taking steps, he began worrying less.
One simple sentence. Nothing magical that I hadn’t heard many times before. However, at that very moment it smacked me good. Like the mule, I was ready to learn.
I am concerned about the next generation. Ridiculous government spending will eventually lead to dollar devaluation, wealth destruction and cuts in Social Security. Individuals will have to fend for themselves. Those that get it will do very well.
Building a good retirement program is not some complicated formula. It is called self-discipline, thinking and acting differently. Having enough money to retire gives you freedom and independence. Money is like ammunition; you never want to run out.
Get with the program NOW and by the time you are ready to retire you will have more than enough to enjoy the rest of the ride without constant worry. It’s worth it….
On The Lighter Side…
The NFL kicked off the regular season last week. Some baseball fans are looking forward to post season playoffs, while fans of teams who came up short are turning their attention to other things.
We watched the University of Texas score 21 unanswered points to take a late lead and beat #1 Ohio State 24-23. The unbridled emotions of college football are fun to watch.
Jo and I are headed to Florida. Last fall we were constantly busy moving in, feathering the nest, the project list was long. This year we plan on becoming more involved in the community; hoping to enjoy even more of what the worlds largest retirement community has to offer.
We will miss harvest season in the Midwest, with corn and soybeans coming down and heading into the bin. I never minded driving 5 mph down a country road following a tractor or combine moving from one field to the next. Things get pretty dusty for a month or so, lots of trips to the car wash.
We will be back in Indiana for Thanksgiving and the holidays.
Quote of the Week…
“You don’t get out of poverty by magic. You get out of poverty with capitalism, savings and hard work.” — Jamier Milei
And Finally…
Jo sends along some clever thoughts for our enjoyment:
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And my favorite:
A fine is a tax for doing wrong. A tax is a fine for doing well.
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