What, Me Worry About Retirement Finances?

Now that our fundraising days have mostly passed, are Encore staff and missionary retirees “done with money”? Can we breathe a sigh of relief? Only partially! We must be vigilant to avoid financial complacency or follow dangerous cultural trends in finances. Here are five important financial issues for Encore staff and retirees:

Overspending on adult children (or grandchildren)!

Studies show that overspending on adult children is a major source of financial pressure for retirees. It pains us to see our children or grandchildren go through financial struggles. We want to help, but when does “helping just this once” become enabling? 

I’ve been guilty of helping too much. It starts out with, “Dad, I’m a little behind on my rent….” Then, “Dad, my phone is broken.” Then, “Dad, I’m three payments behind on my car. I’ll pay you back.” And so it goes. 

When we care more about our children getting their bills paid on time than they care, we are guilty of enabling. This is a discipling issue. Why does your child’s failure to plan ahead mean a financial emergency for you? Also, once they know you’ll bail them out, they begin to depend on it.

A friend of mine had a “come to Jesus” meeting with his constantly-behind-in-money son. He offered empathy, which the son appreciated, but the father also explained what he would and would not do. Even though this father could easily pay his son’s bills, he set a boundary, saying, “I will cover your medical insurance and your auto repairs, but that is all. Otherwise, you are on your own.”

The son agreed to this arrangement but soon asked once more for emergency help. My friend took a deep breath and said, “No!” The son survived and has not asked again. And he has become more responsible. Boundaries—and a good example of discipling.

Don’t toss your monthly household budget!

I thought in our later years I could kiss our monthly envelope system goodbye. But then our Fidelity investment advisor asked for our retirement monthly spending plans so he could project how long our savings would last. He called it a “retirement budget.” Do you have one?

Studies show that “outliving your money” is the biggest worry faced by retirees—especially wives. Hence, the envelope budgeting plan with no bookkeeping. If you have spent the clothing envelope by the 15^th of the month, you must wait until next month to buy that cool Led Zeppelin T-shirt! 

But your retirement budget should look different from your working-days budget. Why not put less cash in the clothing envelope and more in the “eating out” envelope? Men, remember those three little words your spouse loves to hear: “Let’s eat out!”

Note: According to studies, using credit cards instead of cash increases spending by up to 19%. Handing over cash at the store is more painful than handing over a piece of plastic for a 30-day loan. Use cash—you’ll spend less.

Do fun things while you can!  It is easy to postpone fun activities, saying, “It’s too expensive!” Or “The timing is not right—we’ll do it next year.” As retirees we are running out of time and energy to take that dream vacation or to go on a cruise or even an impromptu weekend away. Do your bucket list dreams now while you can. There will come a day when you can’t.

Pay off your home mortgage (if you haven’t already)!  Carrying mortgage debt (or any debt) into retirement is a big drain financially and emotionally on retirees. Hopefully you paid off your house before you stopped your salary, but if you haven’t, what can you do now to pay it off and quickly? 

What about a reverse mortgage that pays you income each month from the equity in your home? Be extremely careful! A reverse mortgage is still a loan which must be paid back by the sale of your home when you no longer live in the house or if you or your spouse die. If a financial tactic seems too good to be true, it probably is.

Invest in memorable events with your family (and others)  Is it “things” you buy for your children and grandchildren that they will remember? Or is it experiences they have had with you and their siblings and cousins? Even though it is expensive, travel to visit your family and special friends such as long-time giving partners. Think of special things you can do as a group or one by one. 

Recently I spent a day with my granddaughter who was visiting from Chicago. She is a sophomore in college and I worried about what we could do that would not be boring for her. I haven’t been in college for a long time!

So, we hiked in the mountains, ate lunch at an over-priced outdoor spot under a shady tree, crossed the street for over-priced ice cream cones and just walked and talked. I found out weeks later that she enjoyed our outing, and I did too. We are closer now because I did some planning and spent a few bucks on food and ice cream.

Retirees and money? Let us be wise. Former Navigator President Lorne Sanny said, “As I grow older, people ask me if I see signs of the Lord’s coming. Yes, I guess I do. But I see more signs of my going!”

My friend, you are not finished! Significant ministry lies ahead. But don’t let financial issues spoil these precious years. Be wise, and may the Lord keep you ever as palm trees (Psalm 92:14-15), “full of sap and very green to declare that He is upright!”

Read more in Scott Morton’s recent book, What the Bible Actually Says About Money and at www.scottmorton.net.