Those born in the 60′s, in their 40′s now, are part of a demographic which I’ve called ‘Tweeners’ for lack of a better name. Between what is the next logical question, right? They’re makin’ significantly more money than their 30-something counterparts, at least most of ‘em are. Their kids are older too. They’re starin’ at college expenses either imminently or in about 5-7 years, give or take.
The big difference though is time. A 40-something earner who’d been diligently forkin’ over part of their paycheck to their company’s 401(k) the last 15-20 years have been rocked big time by the huge downturn in the stock market. Most have experienced a drop somewhere between 40-50%, seemingly overnight — a literally chilling development when you’re lookin’ 50 squarely in the eye.
Tweener? Yeah, ‘Tween a rock and a hard place’.
It’s at that point a 45 year old may take a sobering look at their long held desire to retire earlier than 65. There’s nothin’ like having half your basket of retirement eggs smashed on the ground only 10-15 years before you’d planned to sail into that welcoming sunset. Realizing retirement in your 50′s is now seriously in doubt, if not out of the question completely is not a happy moment in time.
Ah, time — for the vast majority of 40-something Americans, time is not your friend — not by a long shot. It marches onward mercilessly — actually gaining speed as the decades go by. The older you get, the more that seems plausible.
Then there are the 40-somethings who didn’t start families ’til their 30′s, or even their 40′s — a much more common occurrence now than in their parents’ generation. When I started college Mom was 38, which wasn’t out of line with the norm back then whatsoever. My own son started college when I was almost 50. My daughter just graduated a few months ago.
Time is definitely not your friend if you’ve already passed the dreaded 4-0. This is even more of a factor if most if not all of your retirement was based upon the foundation of a flourishing 401. The rosiest of outlooks says most of you will be playing catchup for at least the next five years, though it’s far more realistic to think it’ll be for the next decade — at least. Think not?
If you’ve lost roughly half your capital the last few years, starting today, it’ll require five consecutive years of just under a 15% annual capital growth rate — to get to where you were before the stock market did its thing. Hardly a credible scenario. Yet with a 20% down payment on real estate, a capital growth rate in that neighborhood requires about 3-4% a year — again who knows if that’s gonna happen — but highly more credible in many current growth regions than the stock market for sure.
And remember, after 5-10 years have gone by, (still in the 401(k) ) that’s just to get where you were before the slide began. See what mean? Time ain’t your friend. Whatever you decide to do — you need to do it now. Get started as quickly as prudently possible. You don’t have time to waste — you’re playing a game of catchup. Meanwhile time is still doin’ its thing.
Tick freakin’ tock.
Call me and find out what your options might be. Get answers to questions you don’t now to ask at this point. My number is 619 889-7100. Have a good one.
Related posts:
- You Can’t Go Back In Time, So You Better Get It Right Today — Retirement Income
- Do-Overs? Not When It Comes To Time Or Foundations
- What’s a 30-Something Couple To Do?
- Young Boise Couple Now Knows What They Don’t Know — A Happy Ending
- How To Get Real Estate Flyin’ Off The Shelves Again — This Would Help Big Time
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