I was talking to my 87-year-old grandfather about the economy the other day. He’s got one of those great stories – fought in WWII, came home, married his sweetheart, started working at a local company, never quit. He still works there half-days, just to give him something to do.
He and my grandmother have always lived fairly frugally. Grandma has always tracked prices on everything, to the point where you open the pantry and find the price of all the food written on the package. They wear clothing til it falls apart, then fix it, then wear it some more. Of course, saying that makes it sound like they’re wearing rags. They dress quite well. But Grandpa’s theory is that an old faded t-shirt is just fine for mowing the lawn, and hey, if you need to run to the store to pick something up while mowing the lawn, why change?
Not to say they’re overly frugal. They just spend their money where it’s important. They like to go out to nice dinners every so often. They used to travel quite a bit. They go to the theater and get the good seats, not the nosebleed seats. They spend their money on things that are important to them, and that’s how they’re happiest.
I was talking to Grandpa about the sorry state of my retirement accounts, but told him that at the earliest, I would be eligible to retire at around age 57. As a man who worked 30 years past that, he laughed, of course. We joked about Social Security being a Ponzi scheme, as I’m among the many who aren’t convinced it’s going to be around by the time I retire. As the child of parents at the tail end of the baby-boom generation, I’m okay with that. Sure, I’m paying in money that I won’t see, but it will be used for people like my parents and others. In some way, it saves me from paying out of pocket to take care of them.
His opinion was that the government screwed up. Social Security kicks in too early. In his eyes, when the program started, it was designed for people near the end of their lives. Now people are living longer, partly thanks to programs like Medicaid and Medicare. Clearly, making people healthier so they lived longer wasn’t the brightest plan.
All right, so he was clearly joking. But he did have one interesting point. People are living longer. What if Social Security kicked in later? Would we be better off or not? From the point of view of someone who may never get Social Security, I’d rather get it later than not at all, but I’m sure every single Baby Boomer out there would disagree wholeheartedly. After all, they’re much more likely to be able to get the promised use from the program.
It’s an interesting thought.
Megan is a 30-something government employee in the Washington, DC area. She got interested in Personal Finance when she got out of college and realized that her paycheck wasn’t going to go as far as she had hoped. Since starting this blog, she has managed to buy a house and make a solid start on her retirement goals, and hopes to help others do the same. Here is her story:
In 2007, I was a gainfully employed 20-something with no debt but not a lot of knowledge about personal finance. It was a co-worker’s comment about Roth IRAs that sent me to the internet, searching for information. It was then that I realized that I really didn’t know a whole lot about personal finance and that my current financial situation was due a lot to inherent frugal tendencies, generous family members, a fear of debt, and good luck. While that was working for me, clearly I needed a better plan.
While I had no debt, I was also pretty much living paycheck to paycheck and not worrying about going over budget (I say this as if I had a real budget) because I had an emergency fund set aside to cover any overages.
Except that’s not what an emergency fund is for.
So I did a lot of research, read a lot of blogs, and decided that I needed a plan. I needed to budget. I needed to know what I was spending my money on. I needed to prepare for the future.
I decided to create a blog not only to make myself accountable to others but also to share the knowledge that I gained along the way. I’ve learned so much from my fellow bloggers, and I hope that my readers can find something useful in what I have to share as well.