Retire, Unretire or Keep Working

Jane Bryant Quinn is a well known financial journalist who writes about personal finance. Her books and columns are about investor protection, health insurance, Social Security, and the sufficiency of retirement plan. Now 80, she is retiring.

I read a farewell article by her in the AARP magazine (Yes, I do read my AARP magazine) and I thought it would be interesting to see how someone who has been advising others about retirement would handle her own retirement. Obviously, she didn’t stop working at 67, but her phase one plan surprised me.

“After all these years of reporting and writing about how to prepare for retirement, I’m trying it myself…My husband retired last year and, just as I’ve advised in my columns, we’ve had many, many conversations about what to do with our time. To start, we’re going to follow a dream and live in Rome for a year. Art. Music. Gelato!”

I believe I am in unretirement (not a term I coined). That is when you have ended your full-time career but continue to work: a) when you want to work b) only at things you enjoy doing  c) either paid or unpaid.

For me, the key phrase in her article is “After Rome, my calendar is blank.” That’s a brave thing to say about retirement – especially for someone who has spent a good part of her life advising people about how to plan their future.

My friend Pat decided after retirement to sell her house and car and move to Florence for a year. I’ll confess that I was far more apprehensive/frightened about her going to Italy to live than she was about this adventure. I know that it’s not something I can do – both because of circumstances and because it scares me too much.

What will Pat do when she comes back to the U.S.? (I’m assuming she will come back.) That’s not determined.  Maybe she should go to Rome and visit Jane. It’s not that Quinn doesn’t have any plans:  “I’ll have to invent a life for myself. It’s challenging and not a little unnerving. I’ll spend more time with family and friends, do more reading and more jigsaw puzzles. Then I’ll see what comes my way.”

Quinn made a lot of money telling us how to manage our money in bestsellers like Making the Most of Your Money, Everyone’s Money Book and How to Make Your Money Last.  Notice a theme there? Money, money, money.

I know that having money in retirement is a major concern for people, but I don’t think it should be the number one concern.

I know people who have retired, have adequate money and are unhappy. Why? The most common reason seems to be because “I don’t know what to do with myself.”

Looking at retire in Merriam-Webster online I found lots of definitions. Most of them bring no joy. The etymology goes back to Middle French retirer, from re- + tirer meaning “to draw.” (My French-speaking wife tells me that nowadays the word used is retraiter, meaning both to retire as from a job or as in an army retreating.)

From the mid-1500s the meaning had nothing to do with retirement as we think of it today because no one got to retire from their work. You worked until you either couldn’t work anymore or until you died.

The word doesn’t have very positive connotations: reserved, shy, secluded (as in a retired village), to withdraw, to retreat (from action or danger, or for privacy or to sleep, as in she retired to her bedroom), to move back, to recede, to withdraw from circulation or from the market (as with a product).

That latter meaning is the one that bothers me.  The idea of retiring a product or a service from use because it is no longer relevant or saleable is one thing, but to retire a person from use depresses me.

Perhaps, my transitional meaning comes from baseball. You can retire a batter (3 strikes) or even retire the side (3 outs).  In those cases, the batter or team is done – but it’s not permanent. You’ll get up to bat again – perhaps in just a few minutes; perhaps tomorrow.

Leaving one’s job or ceasing to work after reaching a certain age – retirement –  has been around since around the 18th century, though it was something only the upper classes with some wealth could consider. (Prior to the 18th century, humans had an average life expectancy between 26 and 40 years, so only a small percentage of the population reached an age where physical impairments would force them to stop working.)

Countries began to adopt government policies on retirement (beginning in Germany) during the late 19th century and the 20th century. The kind of retirement that Americans think of today didn’t come into usage here until around the 1920s.

Currently in the United States, early retirement is considered age 62 and the normal retirement age is 67. That’s up from the earlier standard of 65 and it has a lot to do with when you collect your full Social Security benefits. Of the 55-59 age group,  66% are still working. That drops to 43% for the 60-64 group. The big drop is for 65-69 who have only 20% still working. At 70+ you only have 5% still working.

I still hear people say that they’ll keep working until they die – either because they believe (sadly, perhaps mistakenly) that they’ll need the income, or because (happily) they love what they do.

I talked with a friend about this post when I started writing it and he reminded me that none of this may be relevant to most people. He said that the situation I’m in and Pat and Jane are in is not the norm for a lot of Americans. We have pensions, Social Security, some investments, a home and enough that if we’re not overly extravagant we should be okay financially in retirement. That’s not true for lots of people.

Of course, none of us can predict the future whether it be about the economy or our own health and circumstances. But you do need to plan ahead. At least, that’s my approach and it’s a cautious one I have taken my entire life. I bet I missed out on some adventures and fun along the way. Is retirement my second chance?



How Is Your Social Credit Score?

What if you could improve your social credit score by reading this entire article? Would that be motivation? Well, you would have to know what a social credit score meant. And you would have to actually have such a score.

You don’t have such a score now, but you may one day. The Social Credit System is a proposed Chinese government initiative to develop a national reputation system. Though it is still being developed, the intent is to assign a “social credit” rating to every citizen. The score would be based on government data regarding their economic and social status.

It sounds like some science-fiction horror story of the future. When I first heard about this real plan, I thought of the 2016 episode titled “Nosedive” from season three of the British science fiction anthology series Black Mirror which is shown on Netflix.

‘Black Mirror’ – Netflix

In that episode, people can rate each other from one to five stars for every interaction they have. The scores impact their socioeconomic status. The protagonist, Lacie, is obsessed with her ratings and through a series of interactions with different people and has a rapid reduction in her ratings.

In this future-that-looks-like-today society, they use eye implants and mobile devices so that everyone shares their daily activities. You can also see someone’s current average and that has significant influence on the way they are viewed.  Lacie’s 4.2 rating prevents her from getting a luxury apartment which requires a 4.5 or better rating. Lacie tries her best to game the system.

The proposed China system is not only a mass surveillance tool that uses big data analysis technology, but is also a way to rate businesses operating in the Chinese market.

A Chinese “super app” called Alipay is already assigning users a three-digit score that works as “credit for everything in your life.” This “Zhima Credit” scale of 350-950 assesses people’s worth beyond finances and is meant to serve as a “credit system that covers the whole society.”

The Chinese government’s “Planning Outline for the Construction of a Social Credit System (2014–2020)” focused on four areas: honesty in government affairs, commercial integrity, societal integrity and judicial credibility. The rating of individual citizens is considered to be “societal integrity.” The plans are to have credit scores for all businesses operating in China.

In news story I heard, it said that you can gain or lose points for how well you separate and recycle your trash. It was unclear how this is monitored – trash collectors, your neighbors, credit police?

Eight companies were picked by the People’s Bank of China in 2016 to develop pilots to give citizens credit scores, including the giant Alibaba Ant Financial Services, which operates Sesame Credit. Ant Financial CEO Lucy Peng has said that Zhima Credit “will ensure that the bad people in society don’t have a place to go, while good people can move freely and without obstruction.”

In an example of one person who started with a 600 score and was able to rise to 722, his higher score entitled him to “favorable terms on loans and apartment rentals, as well as showcasing on several dating apps should he and his wife ever split up, and with a few dozen more points, he could get a streamlined visa to Luxembourg.”

Though scores are not visible on a person (an augmented reality vision) and you can’t currently access other people’s scores on the app, your score is nicely color coded, so a 710 sees a “calming” blue background and a 550 will be greeted by an “alarming” orange tone.

Social credit also involves looking at your friends, and if they are all high-score people, that helps you. Bad credit friends are not a good thing.  Sorry Lacie, but we can’t be friends any more. Your score is bringing me down.


credit score
An “alarming” score on Sesame credit score


Simple Finance

We like things to be simple. How to Live to Be 100. Four Ways to Improve Your Sex Life. No one clicks on links to “150 Things You Need To Do To Feel Better.”

When Professor Harold Pollack was doing an online video chat with a personal finance writer about how people often get steered into bad investments by financial advisers, he said (probably without giving it great forethought) that the best personal finance advice “can fit on a 3-by-5 index card.”

He went on to say that paying someone for advice means that “almost by definition, you’re probably getting the wrong advice, because the correct advice is so straightforward.”

I heard him interviewed and he said that after that video went online he got lots of  emails wanting that index card. His comment put him in a metaphoric corner. But he responded by writing the principles he believed in on a card, took a photo with his phone and  posted it online.

It went viral, got big press, got tweeted by regular folks and economists, and became a simple self-help meme.

People realized the advice wasn’t new or earth-shaking. Sort of like following that Blue Zone lifestyle to live longer: not complicated, but not easy to do.

I heard Pollack and Helaine Olen (that original interviewer) recently talking on NPR because – ironically – they have turned the card into a book: The Index Card: Why Personal Finance Doesn’t Have to Be Complicated

Why do we need a book if it all fits on a card? Well, both of making a living is part of it. Publishers seeing a market is part of it. But in a less cynical response, simple is a start but you need details.

Pollack said (without putting his book on the same shelf) “…why do we need an entire Bible really? We have the Ten Commandments and the Sermon on the Mount.”

Simplicity can be satisfying, to a certain degree, and also frustrating. “See the ball. Hit the ball,” was something a baseball coach once told me. Good advice, and useless advice, all at once.

How would you interpret his advice to “make financial adviser commit to a fiduciary standard?” Do you know what a fiduciary standard is?  Do you even have a financial adviser? Didn’t he say you really didn’t need one?

I like simplicity. I strive to make my life simpler, cleaner, less cluttered. That can be a complicated thing to do.