What do you say to an older friend

[CeciliaW]

I've recommended this forum and the blog to many people over the last year or so.

Several have come back to me and said things like "Well, that's all well and good. If I was 35 again or just starting out it would be a great idea. " Then they tell me some variation of 'I've been working since I was 20. I saved and got an education and a good job. Had kids. Did everything right. Now it's all gone. I got laid off a while back. I'm 58 and no one will hire me. I've been looking for 3 years. We've run through all the 401K money." and so it goes.

Seriously, I couldn't think of anything to say but that I was sorry it had worked out that way.

What can you say to someone who doesn't have another 25 or 30 years to get to Enough (reference to current blog post)?  Realistically what can they do now?

[arebelspy]

I've recommended this forum and the blog to many people over the last year or so.

Several have come back to me and said things like "Well, that's all well and good. If I was 35 again or just starting out it would be a great idea. " Then they tell me some variation of 'I've been working since I was 20. I saved and got an education and a good job. Had kids. Did everything right. Now it's all gone. I got laid off a while back. I'm 58 and no one will hire me. I've been looking for 3 years. We've run through all the 401K money." and so it goes.

Seriously, I couldn't think of anything to say but that I was sorry it had worked out that way.

What can you say to someone who doesn't have another 25 or 30 years to get to Enough (reference to current blog post)?  Realistically what can they do now?

Why does it take 25-30 years to get to "enough"?

10-15 should be sufficient, if you can save 50%+ of your income.  Being older, they should be in peak earning years.

Obviously if they don't have a job, that's tougher.  The biggest problem is they may be locked into a high lifestyle.

On the other hand, time is totally on their side, because they're only a decade or so from collecting social security.  So they can work for the next ten years, building a good stache, then take SS and use the stache to supplement it and have a GREAT retirement (much more so than the average person who has to keep working past 70, or has no other income besides SS and can't retire because their lifestyle has them spending way more than they get from SS).

A decade is perfect to get them in a great position to build up a nice , cut expenses, etc. to supplement SS and be able to retire.

Spin it like that, with time being on their side.

[Fawn]

Someone who is in their 50's can definitely benefit from the MMM message, which I take to be larger than work hard and save all your money so you can retire early. Here's some of the ideas for the middle agers to focus on:

1) Challenge yourself. Physically, mentally, financially.
2) Learn about hedonic adaption. Resist it.
3) Gratitude for what you have. No job? Good thing you had the 401K to spend. 401K gone? Good thing you still have some working years left. Your field is shrinking/laying off? Perfect opportunity to try something new. Sure it won't pay as much as your cushy job before. Good thing you know how to live frugally, etc. etc.
4) Nobody likes a Complainypants. You have troubles? Wah! So does every other human on the planet. You have the worst troubles. Congratulations! You can write a book. Your troubles aren't exceptional enough to get a book deal? You are a Complainypants.

[Another Reader]

Wait until you are in your mid-fifties with no job, no savings left, a house lost to short sale or foreclosure, and no prospect of finding employment.  It's easy to say lower your expectations, but for the people I know in this position, that does not cut it.  Yes, in retrospect, for many of these folks it would have been better to cut the house and cars loose, quit paying for the kids' college educations, etc. early on, but these people had never been unemployed for longer that a couple of months in their lives.  They made what they thought were reasonable decisions at the time.  Peak earning years?  Not if your job has been shipped overseas, your skills are no longer adequate in the market place, or there are just not enough jobs for everyone.

The premise of the MMM approach is that you save a very high percentage of your income.  If you can't pay more than the basic bills on the income you have managed to cobble together, you can't save.  These folks will be living on Social Security when they reach retirement age. 

[footenote]

While I acknowledge this is a dreadful situation to be in when you're over 50, I disagree that mustachianism is just about saving a high percent of income during youth. Mustachianism is equally about constant optimization and optimism.

For example, if I had a friend over 50 who had been displaced in manufacturing, I would urge them gain in-demand skills like statistical process control. The person could re-gain self-confidence, demonstrate initiative, and develop new contacts (that could result in job leads). There are community colleges and displaced worker centers in most states and retraining subsidies are often available.

Winston Churchill: "Never give in--never, never, never, never, in nothing great or small, large or petty, never give in except to convictions of honour and good sense."

[arebelspy]

Wait until you are in your mid-fifties with no job, no savings left, a house lost to short sale or foreclosure, and no prospect of finding employment.  It's easy to say lower your expectations, but for the people I know in this position, that does not cut it.  Yes, in retrospect, for many of these folks it would have been better to cut the house and cars loose, quit paying for the kids' college educations, etc. early on, but these people had never been unemployed for longer that a couple of months in their lives.  They made what they thought were reasonable decisions at the time.  Peak earning years?  Not if your job has been shipped overseas, your skills are no longer adequate in the market place, or there are just not enough jobs for everyone.

The premise of the MMM approach is that you save a very high percentage of your income.  If you can't pay more than the basic bills on the income you have managed to cobble together, you can't save.  These folks will be living on Social Security when they reach retirement age.

It's all about attitude and mindset.

While all that stuff you said is disheartening and makes it tougher to have the positive mental attitude needed, in the scenario in question they have a decade before SS.  I think nearly anyone with the right attitude could use that decade to work for them, rather than against them, to help supplement that SS income.

I agree, it would be tough, and I'm not trying to dismiss it as all rainbows.  I'm trying to point out the silver lining on the dark cloud.

[newideas2013]

If they are healthy enough to work full-time in retail at minimum wage (I worked with MANY people in their 50s/60s who took all the full-time store positions while the young people never got full-time work) the 2 of them could easily live off that income. Even 2 people working minimum wage here in Ontario is 10.25/hour with HIGH cost of living and many people get hired on at 11.00/hour.

So between the 2 of them, that's 22.00/hour with double benefits * 40 hours/week = 44,000/year with 2 weeks off (unpaid) before taxes. I'm sure they could do just fine, and maybe they can even look above and beyond retail. Yes its hard for some people but if you are willing to work, go for it.

I worked with people laid off in the banking industry in their 60s, others were "retired" on a cushy pension still working full-time while the 20-somethings who wanted full-time work who did more work (pulling skids, hauling boxes, driving forklifts) were stuck with part-time hours.

There is lots of entry level work out there, and there is lots more work that wants 3-5 years experience as a barrier to entry. If you are 55+ years old you have 3-5 years experience in NUMEROUS sectors of employment and have a huge leg up on fresh grads with work history of only retail/warehouse/fast food.

[nktokyo]

I've recommended this forum and the blog to many people over the last year or so.

Several have come back to me and said things like "Well, that's all well and good. If I was 35 again or just starting out it would be a great idea. " Then they tell me some variation of 'I've been working since I was 20. I saved and got an education and a good job. Had kids. Did everything right. Now it's all gone. I got laid off a while back. I'm 58 and no one will hire me. I've been looking for 3 years. We've run through all the 401K money." and so it goes.

Seriously, I couldn't think of anything to say but that I was sorry it had worked out that way.

What can you say to someone who doesn't have another 25 or 30 years to get to Enough (reference to current blog post)?  Realistically what can they do now?

Admit that they got it wrong, it's time to stop saving face, sell up and live a LOT cheaper.

[Another Reader]

Most of the people I know in this position don't have much left to sell.  They made the mistake of assuming the work situation would revert to what it had been for the previous 30-40 years, and did not cut stuff loose early enough in the process.  In the western US, there are very few low-level full-time jobs.  If they are full-time, they are contract positions, often through a staffing company.  No or very limited benefits.  Full time retail?  Not here.  I know of one couple in their 60's where he is working a 4-10 schedule as a staffing company contract worker in a warehouse and she is working 25 hours in a gift shop.  Their mortgage is less than rent would be, and there is nothing left to save, after food, utilities, the mortgage, and the health insurance premiums plus co-pays.

Did most of these people make mistakes in their decisions?  You bet.  Younger people should look at what has happened and learn from it.  But the ability of many if not most of the over 50 crowd to start over and end up with much beyond Social Security is just not there.   

[sdp]

My neighbor is still making the mistake of assuming things will get back to "normal".  He and his family rent the house across the street from me.  he is 52, in the construction trade and has had very little work for the last 4 years.  He sits out front of his house most days drinking beer in the afternoon complaining that he doesn't have enough money to pay for rent or for the lease on his wife's car- she doesn't work- she's a bit strange......
I am in the middle of remodeling my bathroom and as a kind gesture I offered to pay him any days he wants to come over and help.  He said he would do it for 35 bucks an hour, I told him 15 (I make 14 bucks an hour at my job, so I would still be paying him more than I make...)  anyway he said 'NO'  and so there he sits, drinking beer and bitching about his circumstance, oh well

[hybrid]

I am an off the charts extrovert, and yet I don't mention this blog to a lot of folks I know even though they are witnessing the changes I am making in my own lifestyle.  Why?  Because I know a bad fit when I see one.  I recall reading the MMM article in the WaPo and some poor schmo in the comments section making 15K a year was going on about "well, yeah, but how am I supposed to save on a minimum wage salary????".  Well, the answers are easy enough (find a way to make more money and then spend less of it) but it was patently obvious that getting through to that person was not doable.  I have shared MMM selectively with folks who I thought would be receptive or willing to consider some seemingly drastic changes.  To the OP, some folks are a Kobiyashi Maru scenario.  Don't lose sleep over things beyond your ability to change.

[Fawn]

I think that we all know someone who went bust in their 50s. My own mom and dad did when his business failed. They had hoped to pay for college for their three children. One of them got it covered, one of them got 1/2 of it covered and I paid my own way.

Christmas was reduced to a Hershey bar each. But my folks have never been Complainypants.

It took awhile, but my dad found a job in a different field (teaching instead of business) and when the teaching job went belly up, he found a small salary state government job. My mom cut every non-luxury expense (except selling their large, paid off home) and they got into a comfortable position before my dad died. Now, my mom has multiple income streams, but lives off only her social security for fun. She is saving up money to give to her kids.

It is all about the attitude.

[nktokyo]

I would give them a copy of Who Moved My Cheese http://www.nr.edu/ite105/docs/WHO_MOVED_MY_CHEESE_eBook.pdf

Times change... and it is tougher on older people but tough cookies, you can adapt or sit around waiting for the gravy boat to come back.

[pbkmaine]

I would also say to find a field that appreciates older workers. I am a pension consultant. No one wants to listen to a 30 year old talk about pensions. I feel like no one heard a word I said until I turned 40 and then I suddenly became WISE. I am 56 and some of my boards have 80 year olds who think I am a Sweet Young Thing.

[MgoSam]

One book I would recommend is "I Moved your Cheese" by Deepak Malhotra, written as his response to the book.

[Christof]

In the western US, there are very few low-level full-time jobs.

Would it be too obvious to recommend moving somewhere where there are jobs? Without kids its much easier to move and to accept jobs that require a lot of travel, because you don't have to worry about schools, breaking up friendships or returning home early to your family.

Tell them to stop applying for the same job they had before they were laid off, because that's a waste of time. Most companies have sadly a policy of not hiring people over 50 if there's someone younger that could fill the position. Business processes keep changing so one's knowledge might be outdated. Instead they should focus on jobs that favor experience, or highlight their experience when applying for a job. Without knowing what they did it's hard to make suggestions, but engineering and sales would be areas where an older person will have a better reputation than a younger one.

Or they could start their own business in a niche, such as counseling shops to improve the experience for older customers. There are so many things one could do that would be better than sitting around and accumulating debt. All starts with a mind shift, though. Stop looking for a continuation of your old life. Quit feeling entitled to a better job because you have served community for decades. If you are depressed, seek medical or spiritual help to get over the negative mood.

[CeciliaW]

Lots of good feedback from many points of view. Much to consider.

Thanks!

Cecilia

[DocCyane]

It will be difficult to muster much sympathy for Baby Boomers who are now experiencing the challenges of a bad job market and a weak economy. They have had a life of ease since birth with cheap education, housing and plenty of jobs protected by tenure or unions. If they failed to save for the proverbial rainy day, there is nowhere for them to look but in the mirror.

Those I know overcoming this late-life challenge are the ones remaking themselves with more education, new skills and a willingness to take jobs "below" their previous positions. They also acknowledge they are part of the problem; not that finger pointing solves anything, but those willing to call out their own stupid seem to be recovering faster than those steadfast in their righteousness.

Do Mustachian ways apply to these people? In a peripheral sense. At this point they need to downsize their lives and expectations. And eat a big piece of humble pie. But don't expect to get a thank you for telling them.

[footenote]

Hey DocCyane - Don't lump all Boomers in the same shame bucket! I'm 55 and DH is 62. We have always been frugal and hit FI when I was 47 and he was 54.

While I agree with your general characterization (a Boomer in my family could be Exhibit A in the AntiMustachian Hall of Shame), a few of us "got it."

[nktokyo]

Don't worry, the children of the boomers are the ones who are proper screwed. They grew up in the wealthiest households in the history of the western world and the concept of having to start small and gradually build up is totally foreign. They want the new kitchen, big house, 2 car lifestyle in their 20's or early 30's and they'll borrow to make it happen.

An awful lot of people have a sense of entitlement about income and standard of living.

[Spork]

Don't worry, the children of the boomers are the ones who are proper screwed. They grew up in the wealthiest households in the history of the western world and the concept of having to start small and gradually build up is totally foreign. They want the new kitchen, big house, 2 car lifestyle in their early 30 and they'll borrow to make it happen.

An awful lot of people have a sense of entitlement about income and standard of living.

I'll agree with everything in that statement except "early 30s".  I see it in them in their early-to-mid 20s. 

[nktokyo]

Corrected - it should be 20s ~ 30s. My parents were boomers (I'm 31) and it's chronic within my friends. Thanks for that.

[Rural]

The baby boom was a long time period, too. I'm not sure the earlier (older) Boomers are much like the younger ones. My completely unscientific observation for the day.

[Adventine]

Don't worry, the children of the boomers are the ones who are proper screwed. They grew up in the wealthiest households in the history of the western world and the concept of having to start small and gradually build up is totally foreign. They want the new kitchen, big house, 2 car lifestyle in their early 30 and they'll borrow to make it happen.

An awful lot of people have a sense of entitlement about income and standard of living.

I'll agree with everything in that statement except "early 30s".  I see it in them in their early-to-mid 20s.

It isn't limited to the West, either. ;) It's a disease of wealthy kids, wherever you go in the world.