
At 77 He Prepares Burgers, Earning in a Week His Former Hourly Wage - weston
http://www.bloomberg.com/news/2013-09-23/why-100-000-salary-may-yield-retirement-flipping-burgers.html
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cperciva
_He receives $1,200 from Social Security and a $600 a month pension from his
last corporate job._

 _When the 2008 financial crisis hit, what little Palome had saved -- $90,000
-- took a beating_

 _He then sold his New Jersey home for $180,000, kept what he needed to
quickly pay off his credit card debt and divided the rest among his children
so they’d have down payments for their own homes._

Ok, so he retired with $270,000 of assets plus $1,800 per month from private
and public pensions. Buy a life annuity (as a 65 year old male) with the
$270,000 and you're getting around $1,600 per month. That yields a total
income of $3,400 a month or $40,800 a year, which is considerably above the
national median income (around $28,000/year according to wikipedia).

As I see it, the problems here are entirely of his own making:

1\. He gave away 2/3 of the wealth he should have been relying on during his
retirement,

2\. He gambled his remaining assets in the stock market rather than making
investments suitable for his demographic (mostly bonds) or buying an annuity,
and

3\. He picked up expensive habits when he was younger -- he takes regular
flights to visit relatives and occasional vacations.

(And I suppose I could add 4. He should have saved far more money before
retiring -- but my point is that even at the point he retired he was in decent
financial shape.)

~~~
kevingadd
Are you saying he shouldn't have supported his children, and that he shouldn't
go see his relatives? That's fucked up.

~~~
Tyrannosaurs
I may be wrong but I'm guessing he's not a parent.

For most parents a choice between yourself and your children is no choice.
He's accepted a level of financial hardship to be, or at least feel like, a
good parent. I see no issue with that.

~~~
cperciva
_I may be wrong but I 'm guessing he's not a parent._

You're right; but I am a child, and there's no way I would let my parents help
me buy a house if it meant that they couldn't retire comfortably.

~~~
Tyrannosaurs
I'm guessing that it was likely that he wouldn't have spelled out in detail
his exact financial situation to them.

If you were his child all you'd probably have seen was that he sold his house
and offered to help you get on the property ladder with some of the money he
released. If that happens and you believe that he's got other savings then
that's a very different situation to be presented with than the idea that
you're messing up his retirement.

But even if that weren't the case it would surely be a failing on their part
rather than on his?

------
VLM
One interesting comedy about retirement planning is a professional retirement
money manager quoted in the article suggests saving 20 times your annual
income before retiring.

If you're poor, you're not going to have the spare money to save.

If you're rich, the IRA contribution limits begin to hit. Hmm lets say 75K/yr
* 20 years / $5K per year contribution limit that'll take 300 years to save
the 20 years worth.

If you're in a career that's short term, its going to be difficult to save 20
years of annual income if no one over the age of 35 is hired into that kind of
work or the average worker burns out in less than 10 years.

And the only purpose of the whole racket is so the medical industrial complex
can simply confiscate it all anyway before you get to enjoy it.

Finally the article implies the guy likes going to work and only does it for
extra beer money. And whats wrong with that, other than people who actually
need the job to live can't get his?

~~~
tzs
> If you're rich, the IRA contribution limits begin to hit. Hmm lets say
> 75K/yr * 20 years / $5K per year contribution limit that'll take 300 years
> to save the 20 years worth.

The IRA limits only apply to money you save in an IRA. There is no requirement
that your retirement savings be entirely in an IRA.

~~~
VLM
True, but its fun to watch the memes fight it out:

1) You need an IRA to retire.

2) You need 20 years income in the bank to retire.

Its fun to watch those two memes fight.

~~~
mason55
I've never heard anyone say you can retire on an IRA alone. A full-funded IRA
is a (almost) necessary but not sufficient condition to retire. You'll
probably also want a 401k plus real estate.

Yes, your primary residence should not be thought of as an investment vehicle,
but it's a good way to have your money ~keep pace with inflation and the
mortgage is a bit of forced savings. After the kids move out you can downsize
and you'll have the difference in cash.

------
rwmj
He had a "low 6 figure" salary, ie. >= $100,000 per year, and over all that
time he managed to save $90,000. So let's say he worked for 25 years and had
no interest at all from his pension, that means he saved about $300 per month.
Which (considering he was paying off his mortgage and putting his kids through
college) is I guess a pretty respectable amount to save.

~~~
nilkn
The six figure salary is also what he was making only at the peak of his
career, so it's possible (probable) that for the majority of that 25+ year
career he wasn't making as much.

Edit: Actually it seems I'm not really correct. The article clarifies this:

> His big break came in 1975 when he was recruited to The Cooper Cos. as vice
> president of marketing for the Oral-B dental-care business.

> The job gave him a high five-figure income and an executive’s life at age
> 39. He flew first class to Cooper offices in the U.S. and in England, Sweden
> and Germany. He helped win an endorsement for the Oral-B toothbrush from the
> U.S. Olympic Committee. He had a closet filled with business suits, and on
> weekends he played golf with other executives.

> So in 1980, when he was 44, he started a consulting company, with Cooper as
> his main client. He also did consulting for Sandoz Pharmaceuticals, Johnson
> & Johnson and others.

> In flush years, Palome had several clients and earned about $120,000. Though
> he saved for his kids’ college and helped his elderly parents, retirement
> wasn’t on his radar.

> “I never thought I’d live this long,” he said.

His wife also died in 1983 so he had to bear the full cost of raising his
children. It seems that he chose to provide a good life for his kids over his
own retirement, as far as I can tell. I know a lot of parents who made or are
making the same selfless choice. This is a slightly different topic, but it's
really unfortunate that for most middle class families having multiple kids is
effectively deciding not to retire comfortably.

------
sharkweek
As a late 20something -- it's hard to predict the future; but truly, I could
imagine my wife and I expatriating when we retire to somewhere where it's just
cheaper to live.

I've been very fortunate to have spent more than my fair share of time
traveling out of the US and there are so many amazing low key places with
decent access to necessities. I really have started seeing this as a viable
option down the road.

I keep reading about Uruguay, and how it's quickly becoming a target
destination for a lot of retirees, assuming I were to be of retirement age
today, I'm having trouble thinking of a reason NOT to do this.

~~~
maratd
> I were to be of retirement age today, I'm having trouble thinking of a
> reason NOT to do this.

Family? Helping your children with their kids instead of selfishly running
away to some tropical destination?

After you get past a certain age, you may also want some help for yourself
from your children.

~~~
malandrew

        After you get past a certain age, you may also want 
        some help for yourself from your children.
    

The cost of a maid or other household help in many developing countries is low
enough that you can get much much much better help there than you could
possibly get from your adult kids with their own lives in the US. A really
good live-in maid will run you $500 a month (a great salary for many people).
They will cook all your meals three times a day, keep the house spotless, do
all your laundry, run errands like buying groceries, etc. You can't find
service like you can in Brazil without paying a pretty penny. The average cost
of a retirement community in the US is $2750 a month, many times more
expensive for probably far worse service, with one employee shared among many
retired individuals.

~~~
maratd
I will always choose care from my children over professional care. Easy
choice. Even a few hours of time with them will be much more enjoyable than
days or weeks with a stranger, regardless of how wonderful the stranger
happens to be.

Not everything can be reduced to dollars and cents.

------
riggins
I gotta say I respect this guy a lot.

For a lot of people their ego wouldn't be able to handle the step down in
status.

This guy took care of his family and now he's taking care of himself.

~~~
adam
Thank you for saying this. Some in this thread are being critical of the
mistakes he made in planning his retirement. That may be, but he's owning it
and working his tail off to continue to do what is important to him, namely
see his children and remain independent. Much respect.

~~~
riggins
Ya I don't understand some of the comments in this thread. I didn't read this
as a guy that was blindsided. I think there's some conscious choice at work
here. He could see what his finances were going to be if gave his savings to
his kids for down-payments and he chose to do it.

------
dreadsword
As far as I can tell, this dude made some choices, and is happily dealing with
the consequences. He chose a consultancy over a pension, and has chose to give
to his children over keeping for himself. And, (a) he notes that he doesn't
have to work but choose to, and (b) any of his kids would be happy to support
him.

From what I can tell, this is a media outlet looking for a juicy story about
seniors festering in poverty where such a story doesn't really exist.

~~~
alexeisadeski3
Also... Who only saves $90k for retirement? You're supposed to have 10x your
income, not .9x.

~~~
VLM
One entertaining part about retirement discussions is apparently young people
think all old people are executives. Wikipedia "median household income"
article claims $29056 for the USA in 2010 for "annual median equivalised
disposable household income per adult".

~~~
alexeisadeski3
If only I were young!

10x income is a sliding scale - anyone can and should do that.

~~~
jborica
Any middle/upper-middle class, healthy American-born person with a caring
family, access to good education resources, opportunities to stay employed
throughout their life, and a drive to work for the market can and should do
that if they live in an area with a demand for new jobs and are lucky enough
to stay away from any serious accidents, diseases, and pregnancies.

As someone who immigrated here as a refugee without a dollar to my name and a
family to feed, I realize how much of a role pure chance and luck play in my
successes thus far despite the obstacles.

------
Zimahl
_At 64, when an 800 square foot manufactured home he’d seen in Plant City, a
Tampa suburb, became available for $21,500, he purchased it with a credit card
to amass frequent flier miles. He then sold his New Jersey home for $180,000,
kept what he needed to quickly pay off his credit card debt and divided the
rest among his children so they’d have down payments for their own homes._

Selling the house was smart, but dividing the rest and giving it to his
children was a terrible move. Homes in the US are used a proxy savings
accounts - sold at retirement or later to gain retirement funds, or used as a
(hopefully) no-rent living space.

~~~
VLM
There are very few no rent homes. My rent has been about $325/month to the
city in prop taxes for the last decade or so. They have held it constant by
increasing all fees in an extortionate manner.

------
rokhayakebe
I am from Africa. My mom gets a pension for $30/month for the few years my
father worked for the government before passing away. With $30 she can go buy
one bag of rice, and maybe enough sugar for one month. MAYBE.

But no one cares. In Africa the retirement is your kids. You take care of your
kids, and when they grow up, they take care of you. While this system is sure
to keep many under poverty, I prefer it to one where someone who is 77 has to
get to work just to ensure he can have the basics.

I respect the way elders think in America. That is they are independent, they
help the youngsters as much as they can, and they are just significantly more
active than older people where I am from. However I do think it is right for
them to have to work past a certain age, especially when they have well-able
relatives.

~~~
jacalata
So what does your mother do when you get hit by a truck? What does an old
person who doesn't have kids do?

~~~
jborica
I'm sure the obscene medical bills would eventually be passed onto her if it
were the US, so I don't see the point of the question.

~~~
nknighthb
You're "sure" of something that's utterly false? Relatives are not responsible
for the debts of a deceased person in the US.

------
caligo
For what is worth I have observed this phenomenon first hand. I am a college
student and I work part time as a sales clerk at a store. I would say at least
20% of the staff consists of retirees. They are usually professionals who
either worked for the government or a larger corporation. Everyone who I've
gotten to know has some savings and doesn't strictly need to work, but doesn't
have enough savings to live comfortably.

What is more interesting is that another 15% to 20% of my colleagues at this
store are in their late forties to mid fifties. For various reasons they each
decided to abandon their careers (found out they didn't believe in what they
were doing, or decided to take time off to look after their kids and could
never get back into the industry, etc...)

It is a bit of a specialized store so I am sure it is not the same
distribution as in a Target or a Walmart. However it is also worth mentioning
that aside from one or two people (who I am not sure about), everyone else has
at least a bachelors degree or is in the process of getting one. There are
maybe 15 college students out of a staff of about 60.

------
NonEUCitizen
His math is wrong, and the journalist just put it in the title without doing
any simple arithmetic.

He makes about $80 a day now, which is $400/week. In flush years, he used to
make about $120K. At approximately 2000 work hours per year (in USA), that
works out to about $60/hour.

So he makes in a week slightly less than his former _daily_ wage. [updated
this -- it said more previously. I can't do math either!]

It's amazing that even a financial publication like Bloomberg has innumerate
journalists.

------
ChrisBland
So someone who didn't save enough for retirement works two jobs to earn extra
income? This really isn't news.

~~~
30thElement
The kicker is located in the middle,

> The median 401(k) balance for households headed by people aged 55 to 64 who
> had retirement accounts at work was $120,000 in 2011

The 77 year old highlighted is just an easy way to personalize the larger
statistics.

~~~
alexeisadeski3
The 401k needn't constitute their entire savings.

------
api
I don't expect to ever be able to retire unless I get truly wealthy.

This is a fairly ugly thing. I'm not sure what I would do if I lost my health
or my skills fell too far out of date for me to catch up.

And I'm one of the lucky ones. I have actual earning power. Most of my cohorts
do not.

I can't imagine this ending well.

~~~
rodedwards
"I don't expect to ever be able to retire unless I get truly wealthy."

Why not?

~~~
jrockway
I guess he's saying he won't save money until he has an excess, as though
anyone ever has an excess of money. ("But I _need_ my own 767!")

------
malandrew
I'm actually shocked that he can't earn better as an educator of some sort.
Seems like a great way to spend your like is 1/3 of it learning, 1/3 of it
applying what you've learned and learning more from experience and 1/3 of your
life sharing what you've learned with those living the first 2/3's of their
lives. If you were successful during the first 2/3's of your live, then
teaching or sharing your success with others should be possible.

That's the route that my dad took, but it wasn't planned and he wasn't even
aware to seek it out. He was a two-time CEO, and one of the companies he
founded and took it to a moderate exit. However after he left the last
company, he moved back home to Brazil, where he encountered ageism over and
over again. Companies and recruiters basically told him "Look, you're the
perfect candidate. Every company looking to compete internationally would love
to have someone like you. However they want someone who has your experience
but is 40 to at most 50 years old. My dad is 66. After struggling for a while
and burning through a lot of his savings being told no over and over again
because of his age, a friend of his put him in touch with Instituto Dom
Cabral, probably Brazil's best business school, where he easily got a job as a
professor doing managerial consulting advice to companies that pay for access
to its professors.

------
Mikeb85
Investments != savings... No one should have any money in stocks if they're
within 10-20 years of retirement, and aren't investment professionals
themselves.

The fact is, people (investors and those who sell investment 'products') got
too used to successive bull markets, and took on too much risk. When the smart
people sold, the dumb people (or those who have too much faith in their dumb
brokers) lost big.

Take on risk when you're young, so if your position takes a hit, you have
enough time to ride it out. When you've got a good amount, switch into low-
risk investments, and when you're within a decade of retirement, put
everything you're counting on into a bank account or GIC. Only play with what
you're willing to lose...

------
lifeformed
So hard to parse this headline...

~~~
VLM
The article wasn't much clearer.

Is the theme that old people without chronic illnesses tend to be more active?

Or a money manager thinks people should give him more money to manage?

Or if old people give money to money managers they should expect to lose 40%
of it as per the star of the article?

Maybe the theme is people who have extreme ups and downs in their lives should
plan during the ups for the downs?

There was some discussion about the star of the article being very unusual
because he has assets and most old people don't. My experience with ancestors
is they have assets until they become sick, then they lose all their assets
that can be stripped from them until they qualify for free medical. Then they
live on free medical and SS until the end. So I'm not surprised that old
people tend not to have assets, thats kind of the point of a for-profit
medical industrial complex.

------
LandoCalrissian
It's strange to me that he can't find any other work as a consultant or
something related to his former field.

~~~
VLM
Ageism? He's a marketing guy, but on HN, 35 is already considered functionally
obsolete. At over twice that age I think you guys as a group would LOL.

Couple that with having been out of the field for many years...

------
rsheridan6
This guy seems remarkably youthful for 77. A lot of people his age wouldn't be
able to handle his jobs, or would not be able to convince an employer to give
them a chance. Even a burger flipper has to be able to stand for hours at a
time and have a decent short term memory.

------
jpeg_hero
this is why i advise young american's to start developing ties and knowledge
of developing economies.

make your money in the US. Retire to Bangladesh/Philippines.

------
twiceaday
Title would be significantly clearer if it was "... in _a_ Week ..."

