Reflections at 59.5

Time. It’s one of the things that still connects human beings to the natural world. We measure weeks in increments of seven days, each day being one turn of the earth, a cycle of night and day. We measure our years by how long it takes the earth to make one circuit of the sun in space. A week is just about one quarter of the lunar cycle. In some calendars, such as the Jewish and Muslim calendars, the month is directly tied to the moon phase. 

To our age, as expressed in these units of time, we ascribe significance. In early life, many of these are determined by faith or scripture (age of circumcision, first communion, bar/bat mitzvah, or confirmation) others by culture (sweet sixteen) and many are determined by law as a somewhat arbitrary date on which something that was prohibited the day before becomes permitted. Driving a car, voting, purchasing alcohol, registering for the draft, being tried as an adult are all things that one becomes allowed to do or is subjected to by virtue of having reached a certain age. 

Then at age 21 (in the U.S.) we reach maximum majority and we skate off into mid-life and there are no further legal milestones related to age for a long time. To be sure, we continue to ascribe meaning to the passing years but most of these are simply the birthdays that end with zero. 30, 40, 50. I noted most of these dates with barely any observance. I remember turning 40 and feeling a new sense of mortality I had not noticed before. If, as the Torah states, a person’s years are three score and ten, four score if granted the vigor, then 40 is more or less halfway, the point at which there are more days behind the cart than in front of the proverbial horse. 

My 50th birthday was on Rosh Hashanah, so the festive meal doubled as a birthday celebration. There was cake. But for that, I don’t think I would have given it much notice. This week however, I marked a date which is the first of legal significance since I turned 21 some 38 years ago. 

To understand the significance of this date one must go back to 1988. That year I turned 27 and I made the conscious decision to start saving for retirement. The decision came along with a bunch of other stuff associated with early adulthood, getting married, having a career, contemplating kids, buying a house. 

My wife and I spent 1986 and half of 1987 tramping around the world and living in a tent, and we spent every nickel we had doing it. We returned to the world of 9-5 in 1987, slightly worse off than totally broke. We had no financial assets and still each had some college debt (modest amounts compared to the what today’s undergrads often borrow.) Luckily, I quickly found work at a nonprofit membership organization for risk managers in local and state government. A rep from the company that managed the organization’s retirement plan gave me the pitch to start saving. 

The trend away from traditional pensions had already become well established in the late 1980s and my wife and I, like most people my age, would not have a fixed benefit pension for life at retirement. Rather, I understood we would have only what we saved plus an additional (small) amount that our employers might choose to contribute on our behalf. The task of ever saving enough to retire would appear to be insurmountable if it weren’t for two things: The magic of compounding and enough time for it to happen. Retirement seemed a long way away but that long length of time is what could make it possible. Using fairly simple math, one could look at prevailing interest rates and the amount of time one had, and calculate how much one would need to save each year and how long it would take to reach a number that would allow one financial freedom. The earlier you start, the better. 

Nowadays, there are many proponents of the idea that simple living and aggressive saving can enable one to retire in their 30s. But in the fast paced, materialistic 90s this idea was not talked of that I recall. Still my calculations, based on the high interest rates and fantastic returns of the stock market at the time (the S&P 500 returned more than 27 percent in 1989) led me to believe that retirement at age 45 or so was not out of the question. It would require saving a significant portion of our income and of course, the market continuing to outperform its historical average.  

But then reality happened. 

• I was very naïve about the ups and downs of the market. Yes, the stock market is the best return on investment over time, but there is a reason that historical averages are well, historical averages. What goes up also comes down. Sometimes it comes down several years in a row. 

• Children require clothes, more living space, and sometimes unexpected moves to accommodate their educational needs. They consume vast amounts of food. They want Pokémon trading cards. There is college, weddings. These things cost money. 

• Stuff, commuting, cars, a motorcycle, fair-trade coffee. Life did not stay as simple as might have been ideal. 

Also, my plan had one huge flaw that I had overlooked. The vehicle I had chosen for most of my savings, the tax deferred 403b plan offered through my employer is, for all intents and purposes, locked up tight until Uncle Sam says it’s ok for you to retire. Withdraw your savings before then and you owe not only the income taxes you postponed but also face penalties for early withdrawal. Save as much as you please, but it is inaccessible. You can’t touch it until you hit the magic age. I was not able to retire at age 45. 

By good fortune, it turned out I didn’t want to. I liked my job. It gave me purpose, and I found the work to be meaningful. It also came with lots of benefits. I got to travel to beautiful places, meet interesting people, and make many friends. There were a not insignificant number of included meals.

So well into my 50s, I kept working and I kept saving as if I were 27 and would retire at 45. Meanwhile, the S&P 500 index continued to generate its relentless historical return, at least on average. 

In later life, the legally significant birthdays return. People who are 60 in Maryland right now are eligible to be vaccinated against Covid 19. Age 62 is the earliest age for taking Social Security. At 65 one is eligible for Medicare. So called “full retirement age” is reached at 67 when you can work as much as you want and still collect Social Security, and at age 72 one is required to take minimum distributions from tax deferred retirement plans. I have not achieved any of these milestones (kilometer markers?). 

I haven’t worked for wages since June of last year. I had spent the previous five years as “interim director” at Hillel at the University of Rochester. This was perhaps the most interesting and challenging job of my career. I loved the work and I loved Rochester, N.Y., but then it was time to return to Maryland and to my life and family here. Initially, I thought I might look for another job.  Then the pandemic hit and didn’t seem like a great time to be job hunting. After 33 years of continuous employment, it seemed ok to take a break. 

The word ‘retirement’ was initially a word I refused to use. It is redolent (at least for me) with irrelevance, convalescence, and the beginning of the inevitable slow slide toward death. When people asked, I preferred to say that I was unemployed. Somehow that seemed to carry less of a stigma. 

Then last Sunday, I turned 59 and a half, the age at which (how did they come up with that number?) one may withdraw funds from Individual Retirement Accounts and other tax deferred plans without penalty. For the first time, I can dig up a few of the nuts and seeds that I have been squirreling away for more than 30 years. But it turns out there is another hurdle. It is not a legal but psychological one. After all the years of saving, it seems completely counter-intuitive to think of flicking the switch that reverses the flow from save to spend. Thanks to my wife (now known as ‘the breadwinner’) we have not had to move that lever yet, but no matter how many Monte Carlo scenarios (how does that phrase inspire confidence?) I run that say it’s cool, the thought of living on savings instead of earnings is disquieting. Not disquieting enough though to make me look for a job, however. At least not so far. 

Because there are still so many things I have left to do and I just can’t see how I can get them done and also work full-time.  With a lot of luck and some careful planning, the small surplus we’ve accumulated may last through the remaining years. But as I approach the next age that ends with zero, I am increasingly aware that there is one resource whose limits are strictly fixed. It’s one resource you may choose how to spend but you can’t save. 

How will you spend your time? 

Here is a poem about the passage of time written around my 50th Birthday.