Carol and Michael Smith are working toward it, Trisha Stavros has started thinking long term about it, and Norman Heathcote has enjoyed it for five months.
They?re in different stages of the process, but in an uncertain economic environment, these and other middle-age people share the same thoughts and concerns about one thing: retirement.
“There?s a lot of uncertainty out there,” said Ted Provenza, a certified estate planner with The Provenza Group in Owings Mills.
“The price of flour is up 34 percent from the beginning of the year, the price of eggs is up 28 percent, and gas prices seem to go up every day,” Provenza said. “Whose income is growing at those rates to make up for those costs?”
In fact, more than 25 percent of workers 45 or older have postponed plans to retire in response to the current economic slowdown, according to a recent AARP survey.
As it gets harder to rely on personal investments and 401(k) plans, more people are looking to planners like Provenza who offer comprehensive legal, planning and financial services to prepare for retirement and beyond.
“The race to retirement has changed,” Provenza said.
?LIKE A HOUSE OF CARDS?
The Smiths, of Ellicott City, joke they?ve tried every investment plan out there, enduring financial ups and downs along the way.
Carol Smith, 58, is a part-time nurse, while her husband, Michael, 60, has been working for Sherwin Williams for about 30 years. The Smiths are nearing retirement, Carol saying her husband is aiming to be retired by 66.
The Smiths called Provenza about eight months ago, because of “a little bit of uncertainty with the stock market in terms of planning.”
“You can?t not prepare, and then something happens and there?s not enough time to make up the loss,” Carol said. “[The economy] is totally uncertain ? it?s like a house of cards. I don?t think anybody can be really confident.”
?THERE?S NO GUARANTEE?
Stavros, 44, of Hunt Valley, knows she?s “20 to 22 years” away from retirement, but her personal investment history has made her rethink her future finances.
“I was investing in mutual funds on my own, and I was making about 1.5 percent per quarter, if that,” said Stavros, a human resources manager in Baltimore. “Then inflation is eating it up, taxes are eating it up. You can?t get ahead.”
Stavros started working with Provenza a few months ago, because “there?s no guarantee” her personal investments will pan out and her company doesn?t provide pension plans.
“It?s really scary with all this uncertainty,” Stavros said. “There?s just a lot of people who are going in this direction of financial planning.”
Even though retirement is years away, Stavros is thinking about the future today. “I?m at the end of the baby boomer generation,” Stavros said. “You?ve got to make sure you have enough money so you can retire.”
?SO I HAVE ENOUGH?
Heathcote, 62, of Owings Mills, has been retired since the beginning of the year, leaving Burdette, Koehler, Murphy & Associates, a mechanical and electrical engineering firm in Baltimore County, after almost 40 years of service.
Heathcote, who said he?s still open to doing some consulting work for the firm, said he had been thinking about retirement for many years.
He wasn?t worried about having enough money to retire, but he did want to know what to do with that money when he did retire. So he too called Provenza about a year ago.
“I wanted to take some time and know where I should have my money so I have enough in retirement,” Heathcote said.
Retirement is going well, Heathcote said, as he?s spending time with his wife and mother-in-law and working on restoring a 1930s Ford Coupe.
The biggest adjustment for Heathcote? “Learning how to not pay attention to the alarm clock in the morning,” he said.
THE SAME QUESTIONS
The Financial Consulate, based in Lutherville, offers similar services as The Provenza Group, and its clients have the same concerns, said Timothy Mauer, director of financial planning.
“People are asking that question every day of the week ? ?I?m getting a little worried about my portfolio. What should I do?? ” Mauer said.
Drew Tignanelli, president of The Financial Consulate, encourages people to think about future planning well in advance of retirement. “When people retire, you?re transitioning from being ultra-productive to almost nothing,” Tignanelli said. “With financial planning, you?re preparing your mind to work and save.”
RETIREMENT CONCERNS
More than 80 percent of workers 45 or older say the economy is in “fairly bad” or “very bad” condition.
More than a quarter have postponed plans to retire.
One-third have stopped putting money into their retirement accounts.
Source: AARP Survey, June 2008
HELPFUL LINKS
Here are some links that can help you plan for your financial future.
