AMERICANS THINK they need an average $1.9 million to retire, according to a survey of 401(k) plan participants by Charles Schwab. Years ago, a finding like that would have terrified me.
I worked really hard in my younger years and socked away money diligently. But between paying off the mortgage, saving for the kids’ education and being hit by an unexpected divorce, there’s no way I could ever have amassed $1.9 million.
In the movie, Pacino plays retired Army Lieutenant Colonel Frank Slade, a blind and bitter alcoholic. He survives on a disability pension, living in a converted garage behind his niece’s house.
Once an aide to President Lyndon Johnson, Slade knew the high life. But now he spends the bulk of his time alone, slumped in an armchair, feeling miserable and sorry for himself. He knows his best days are behind him.
Slade comes up with a plan to go out with a bang (pun intended). The movie is filled with a series of last-chance adventures that are deeply pleasurable to Pacino’s character.
He uses money saved from his disability payments to travel by limo to New York City and check into the Waldorf Astoria Hotel. He gets to dance a tango with a beautiful woman, drive a Ferrari and flirt with a seamstress as she fits him for an expensive suit—the last one he will ever own.
It’s his last hurrah. To end his trip, he plans to don his Army uniform and then shoot himself with his service pistol at the Waldorf. But, of course, it doesn’t turn out that way.
Like Pacino’s movie character, there are many folks who don’t have enough for a comfortable retirement. Fully 45% of U.S. baby boomers have no retirement savings, according to a report by the Insured Retirement Institute.
Retirees with no savings can try to get by on Social Security, but it’s no fun. It’s a constant struggle to pay the rent or property taxes, and for food, utilities and health care. I know plenty of retirees who never eat out, never go to a show, never take a trip. They can end up angry and bitter, just like Pacino’s character.
I never wanted to live that way, which is why I’ve been frugal all my life. I scrimped, saved and made sacrifices, so I could provide financial security for my family. I know what it’s like to take the kids on vacation—and yet feel like I couldn’t afford all the fun things we wanted to do.
Now, the kids are grown, I’ve achieved financial independence and I want to do all those fun things that I didn’t do back then—while I’m still healthy enough to enjoy them.
My basic living expenses are covered by pension income and savings. I withdraw from my savings at a sustainable rate. I pay for my peak experiences with the fun money I earn from part-time work.
Now that I know I won’t run out of money, I don’t worry how much dinner will cost at a nice restaurant. My goal is to live better than I did before retirement by enjoying as many peak experiences as possible. I want to do what Slade did—except for the suicide part—and make it last for as long as I can.
I feel like I’ve won the game and I want to take a victory lap in retirement. I have my freedom back. I’m happy to work part of the time—but only on my terms and only doing things I love.
Mike Drak is a 38-year veteran of the financial services industry. He’s the author of Retirement Heaven or Hell, published in 2021, as well as an earlier book, Victory Lap Retirement. Mike works with his wife, an investment advisor, to help clients design a fulfilling retirement. For more on Mike, head to BoomingEncore.com. Check out his earlier articles.