Tuesday, October 11, 2011

Pudding face

The proof of the pudding is in the taste or perhaps in the pudding face. Well, I've got pudding face and I'm happy to say so.

I wish I could write freely about what I've managed to achieve in the management of the fiscal crisis that long term care precipitates but you know the internet. It really isn't safe to post even your name these days because once you do, someone's knocking your door down trying to steal your identity or worse.

What I can tell you is what I told my own family: don't depend on having money. Today's costs of care cannot be paid for out of today's earnings. They need to be paid for out of savings long held or out of a stream of income earmarked for just that.

Money is very easily outlived (I've done it a time or two already and I'm extremely frugal) but you cannot outlive income. You may perhaps outgrow it, but you won't outlive it. Think about it. Twelve thousand dollars will always be just that: twelve thousand. Over time, with the rising cost of living and the continuing need to eat and go to the doctor and all manner of other thing, that lump sum will dwindle to nothing. The same is true if the starting point is twelve thousand or one hundred and twenty thousand. A one thousand dollar a month income however, will just keep on coming. Like the tide, it keeps flowing. In twelve months, you'll have seen $12,000 but guess what? In month number 13, here it comes again and with it, another opportunity to stay ahead of your financial commitments. As I said, you may outgrow it, it may cease paying all the bills but it won't stop. Your goal therefore should be to figure out how to beef that income up, so that it stays abreast of your financial responsibilities and commitments.

When my mother retired, her mantra was, "I must hold on to my gratuity" and she tried valiantly to do just that. But life throws things at you, and you find yourself dipping in to these precious savings. Before you know it, it's all gone. Even if you do manage to hold on to it, money loses its value. Inflation is not your friend, hyper-inflation even less so, difficult economic times or 'green guava season' as we say in Trinidad, none of these is a friend to the retiree. These things happen and our savings, unless we are multimillionaires, are no match for economic uncertainty + aging's illnesses. The only thing that works to keep the wolf from the door is income. [Playing the lottery is a fun Plan B, but for obvious reasons cannot be counted on to bear fruit. And for my older friends for whom hoping they don't get sick is the Plan B, all I can say is that 'hope' is not a plan.]

So I'll just say this (again): have that Talk with your parents or your children and come up with a plan to earn and save the funds required for care, then work the plan. Don't expect easy. Don't think there won't be many, many hiccups but trust and believe that with time and a bit of luck, your plan will bear fruit.

Personally, I recommend some low stress business venture that creates a small (but hopefully growing) stream of income. Only you can know what will work for your family. I'm a big believer in leaning in to your gifts, using whatever talents you have, to create something that works. Like making bread? See what you can do. Make homemade breads for your neighbors, once a week, once a month. Whatever works for you. Like making chocolates? Try your hand at that. Love writing? Well, see if there's a low stress way to use that gift to generate a dollar.....and when you find out how, send me a note! I'm just saying, lean in to whatever gift or passion you have and see where it might lead. If you're not sure whether your idea is a good one, bounce it off a couple of people you trust (can't stress that enough!) and then move forward gingerly. Heck if you can't find anyone to talk to, talk to me. I'd love to help. I'd be thrilled to see others leave the land of 'let's pretend it'll be OK'. I've told you how that turned out for us.

Nothing comes without a lot of effort and some pain, but in the end it will have been worth it.

The proof of the pudding they say, is in the taste and mine tastes pretty good. Hallelujah! There are many bumps in the road ahead, but at least I can see more clearly now.

Copyright © October 2011 L.S. Semper 

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