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“YOU’LL STILL HAVE a retirement. It just won’t be the one you planned on.”
I’ve had to share this sobering assessment with many patients who were hoping to be rewarded for a lifetime of hard work and responsible saving, only to have those hopes dashed by an unforeseen health crisis. The culprit may be an external event like a disabling car accident or crippling fall, or an internal one like stage-four cancer or early onset dementia.
Such family health catastrophes can interrupt retirement savings, or disrupt a retiree’s plans to travel or pursue long-neglected hobbies. I know all about this—because I’ve seen it happen in my own family.
Stroke of misfortune. My father was an impoverished immigrant who started with nothing and wound up with something, but not what could have been. When only age 66, he suffered a major stroke that impaired his judgment and paralyzed him on the left side—a devastating blow for someone who’d previously exuded invincibility.
A Jewish redneck, if there is such a thing, my father wasn’t averse to letting you know he was a man’s man. When I was felled by a serious depression in midlife, he told me to “hurry up and snap out of it.”
My dad was a wily character who first cashed in on the TV bonanza of the 1950s. He soon pivoted, riding the gravy train of commercial New York real estate over the ensuing three decades. His modus operandi was rehabilitating poorly maintained commercial buildings whose upside rent potential could be tapped with minimal upgrading.
Partly by chance and partly through shrewdness, my father concentrated his investments beneath the glamour of Midtown. He often invited me to accompany him to his office in Lower Manhattan, where he would have me stand by the window as he waved his right arm in an arc and tapped me on the shoulder. “Stevie, they have no more room up there, so they’ll have to take all their ruckus down here. Maybe not in time for Mommy and me, but for you and Richie.”
But for all his bluster, my father was no match for his stroke. The paralysis punctured his bloated sense of masculinity and mastery. Feeling vulnerable and frightened, he abruptly unloaded all his buildings in one mad dash. Insecurity about his health prompted an impulsive cashing out that meant paying large sales commissions, closing costs, legal fees and capital gains taxes.
The untimely selling spree included dumping the property at 591 Broadway, which cuts across the center of gentrified and tony SoHo. It’s now leased to an expansive Victoria’s Secret, whose monthly rent alone dwarfs the price my father received for the sale. In concert with his other nearby properties, it would have “made us a small player on the SoHo scene,” says my brother Richie. “Broadway was his crown jewel. No way he would have let it go,” were it not for his stroke.
Back into surgery. “Richie, how goes it? The day after the surgery, you were in a lot of pain.”
“It’s still really bad. It cuts right through the painkiller. And I can’t walk outside without a cane.”
“What? You’ve got to be kidding me.”
“It’s worse than that. I can’t bend. I need one of those grabbers to pick my dirty socks off the floor. How can I run a law practice when I can’t sit for very long? What a mess.”
“Holy smokes, your back situation is worse than it was before. What do they tell you?”
“That I should feel some relief in a month or two.”
“Well, sounds like you just have to hold on for a while.”
“No, Stevie, I’ve already gotten a second opinion. The guy looked at my records and scans, and thinks the operation was botched. Standard lower back surgery shouldn’t take eight hours.”
“Oh, boy. Now what?”
“He thinks I should first try to get some relief by removing the two loose screws. We’ll go from there. Why did this happen to me? I’ve exercised like a madman, using a treadmill for more than 25 years. Now they think all that stomping may have contributed to the spinal deterioration. Here I was looking to wind down from the law business and enjoy the retirement I deserve. I had it all figured out. I would combine Social Security and my Roth with the net rents from the properties to create a hands-off income stream.”
“Oh, Richie, I’m so sorry this happened to you. Sometimes life can be so random and unfair.”
Short tenure. “And how about what your depression did to your career, Stevie?” my brother asks. “No more graduate students, no more research and eventually no more job. Your currencies were publications, grants and tenure rather than money, but it’s really all the same thing.”
“Yeah, it was a rough go. The depression made me wise before my time about people, families and the role of just plain luck. I had the good fortune to have a phenomenal disability benefit with the university. By classifying me as disabled rather than retired, the medical school credited me with many years of continuous ‘employment’ that vastly increased my pension.”
I continued: “Richie, my close friends were great, and gave Alberta and me loads of support. But my colleagues at the university disappeared. That really hurt, especially because some of them owed their tenure to my ghostwriting.”
“Mommy and Daddy came through, though, right?”
“Boy, you’re not kidding. Even though he thought that depression was just a psychobabble cover-up for laziness, Daddy paid for all those years of therapy. Our father was a real character, so difficult but so loyal.”
“But Stevie, all your retirement planning got waylaid.”
“It would be easy to say yes, but it was more complicated than that. Early on, I was a trigger-happy investor, particularly when I was trading stocks. Back then, long-term meant over the weekend until the market opened again on Monday. But when the depression hit, I had so little energy. I simply wasn’t able to flip properties or play the market. Benign neglect allowed me to have more than 20 years of uninterrupted appreciation and compounding.”
“Unbelievable. You made out like a bandit in spite of yourself.”
“Just think, Richie, if we didn’t have the financial wherewithal to support us through our health ordeals. So many people approaching retirement don’t have that kind of cushion. A healthy lifestyle can turn the odds in your favor, but it can’t remove all the uncertainties. Everyone needs to prepare for the possibility of a health catastrophe that sabotages retirement in ways that seemed unimaginable only days before.”
Steve Abramowitz is a psychologist in Sacramento, California. Earlier in his career, Steve was a university professor, including serving as research director for the psychiatry department at the University of California, Davis. He also ran his own investment advisory firm. Check out Steve’s earlier articles.
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Thank you for the excellent article discussing such an important topic. One of the most valuable pieces of advice I was fortunate to receive when I was in my late 30s came from the lovely gentleman whose position I took upon his retirement. During one of his generous check-ins with me, he mentioned the importance of taking advantage of opportunities to do fun things (vacations, etc.) while working, rather than waiting until retirement when “your body might not be able to keep up with your brain”. Though he was only 58 and in good health, his plans were thwarted somewhat by his partner’s health.
Another item I heard or read somewhere also really struck a chord.
It suggested that when it comes to three precious resources–health, wealth and time, it seems we are often only able to enjoy two at a time.
In our youth, we often have our health and plenty of time, but little money.
During our working years, we may finally have some money and still enjoy good health, but our time is limited due to all of the competing demands for our attention. In retirement, we may have wealth and more (free) time, but our health may be compromised.
I’d like to take the notion of time in retirement a little further. I think a meaningful retirement may start with travel, entertainment and a rekindling of hobbies, but it can be so much more. There’s room to draw from and enhance your inner experience. You can revisit childhood memories and reinterpret dubious choices you made in mid-adulthood in the light of newfound wisdom. Just driving around town, I find myself laughing out loud as I replay youthful antics shared with friends so very long ago. Although our inner voice can be critical and harsh, it can also be a fount of self-awareness and renewal in the quiet space made possible in retirement.