The Retirement Bubble

They were just kids, teenagers to be more exact. I was working in Ghana in West Africa 40 years ago and these kids’ parents were working there too, but out in the “bush”. They needed an education, but they couldn’t get it in the bush, so they stayed in a hostel in Accra, the capital city, and attended the international school there. They were of various nationalities from North America and Europe. They hung with other teenagers who attended the school, Ghanaian and expatriate.

I was 27 and on my first international assignment following Peace Corps. I worked professionally with many of their parents. As a result, I got to know them all well. The expat community in those days was very small, so we knew each other, worked together sometimes, socialized together frequently, and formed a real sense of community with each other.

Due to my relatively young age, I forged a bond with these teenagers and thoroughly enjoyed their company. I was young enough to remember what it was like and yet old enough to be able to stand aside and let them work their way through it without my criticism.

They were a mixed crowd, but they held two things in common and that may be instructive for us.

First, they all had to leave their friends and other family members behind when they moved to Ghana. Like most kids in most circumstances, I am sure this was not a happy transition for some of them. And for many of them, if not all, they also had to live away from their parents, often seeing them only once a month. Additionally, in those days, nations like Ghana offered very few of the amenities that expats liked, and even fewer that expat teenagers liked. But circumstances beyond their control gave them no choice. Their only choice was to work with reality and make it as much fun and as useful as possible.

The second thing they held in common, although they were likely unaware of it at the time, was very obvious to me. They were substantially more mature than kids of their age that I knew back home in the US. The difference was really striking. Yes, they were teenagers, Yes, they could practice a little deviltry from time to time, but they learned to deal with highly unusual circumstances effectively and almost always responsibly. Their parents trusted them, as did the folks running the hostel for those living there. Oh, they had rules to live by and they had curfews that had to be respected, but all of us adults were deeply impressed with their maturity. I got along well with them not simply because I was so “young”, but because they were so “old” in a very positive way.

All wasn’t perfect. One or two had some serious problems adapting, but they worked their way through them. Perhaps their “maturity” came at a higher cost, but once gained, paid off richly. Life forced them to jump off a cliff and they suddenly had to grow wings. They did. It wasn’t easy and it wasn’t always fast, but they grew those wings and it paid off.

I sit here now, waiting as the days tick by toward my 67th birthday, recognizing my debt to a group of teenagers in Africa four decades ago. They didn’t teach me anything that was new, nothing that I couldn’t have figured out for myself, but they did something more. They lived it in full view of me and the world around them. It was and still is an inspiration.

Perhaps it can be the same for you. I am sure nothing above comes as any great shock, and I’m sure you can understand that there are “cliffs” we are forced off from time to time.. We all have to grow wings at various times in our lives. We gave plenty of scabs and bruises and cuts to show for how challenging that can be, but let’s not forget, we are still here. In today’s world, we may feel that we are being forced to jump off a cliff far higher than any before. Time to grow wings again. Indeed, “growing wings” is what the Life Sabbatical is all about.

It ain’t easy. It ain’t painless, for sure. But it pays off.

Like those teenagers when the change was first forced on them, we can find it difficult to imagine how it might improve our lives. The key is to accept what we must accept and adapt. At our age, we may be considered “mature” already, but all of us can still grow up a little more. The Life Sabbatical or some similar approach is meant to make it not easy, but easier. We are never too old to add another inch or two onto those wings that have carried us this far. But they don’t grow by themselves. We need to make it happen, like everyone else.

I would like to introduce you to one of those teenagers from 40 years ago today. Her name is Barbara Higbie. She was only 13 when I first met her and her family. She was bright, smart, and talented, although her talents were to be discovered. She was pushed off the cliff along with all the other kids. She had to grow wings too. She grew them in her own version of a Life Sabbatical. She was very sociable and very busy as teenagers can be, but she took the time to seek out a master Ghanaian drummer, Mustafa Tetty Addy, and discovered a new talent, music. When she was 17, she had her first professional appearance. Since then, she has mastered a dozen instruments, although she is best known for her work with the piano and the violin. She is now 53 with a Grammy nomination and twelve albums behind her and is still traveling, sharing her music in public venues all over the US, and elsewhere when the opportunity arises.

So I will leave you today with one of my favorite Barbara Higbie videos. She is the blond who turns her violin into a fiddle. If you look closely enough at her face, you will see the same 13-year-old I once knew.

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I write when I have the time and inspiration. If you enjoyed this post and do not want to miss new ones when they are published, click here to subscribe to updates to The Retirement Bubble by e-mail. If you prefer an RSS feed, click on the RSS symbol on the upper-right of this page. If you would like to share this with a friend, just click on “share this post” below.

It has been the usual crazy time associated with holidays, not to mention a number of other things, so this is the first post in a while. It’s pretty simple, basically it will introduce what has been written by others. A reader of this blog, Dan, helped me by sending a link to an article on retirement that I had not seen. I’m an analyst by profession, but a human by nature, so I have very limited time for any one of the half-dozen topics I am following at present and I miss some good information in the process. Thus a little help from a friend is always appreciated! I will share the wealth with you by providing several links that may be of interest.

Dan sent me a link to an article at The Atlantic magazine in the US. It poses the question, “In the ‘Indian Summer’ of their lives, more Americans between 50 and 75 are working well into years that used to be exclusively for the retired. Should we cheer them?” Although the article stresses a few cases that may not be relevant to you specifically, it underlines a growing trend for older people to become entrepreneurs, the subject of this post. Indeed, the Life Sabbatical is all about entrepreneurship. To read an article like this is very encouraging. It provides a general discussion of the shift among some of us of “retirement age”. It is titled, Old Dogs, New Tricks: Why More Seniors Are Starting Companies.

It mentions other research which I promptly checked out. A study sponsored by Civic Ventures with the support of the MetLife Foundation and Penn Schoen Berland provides some basic statistical information on this growing shift. They refer to the hoped-for results of a Life Sabbatical as an “encore career”. That’s cool. Here is an excerpt.

New research from Civic Ventures, a think tank on boomers, work and social purpose, shows that as many as 9 million people ages 44 to 70 are already in encore careers that combine personal meaning, continued income and social impact. That’s up from an estimated 8.4 million in 2008. Another 31 million people, ages 44 to 70, are interested in finding encore careers. Together, those currently in encore careers and those interested in encore careers represent 40 percent – or two in five – of all Americans ages 44 to 70. [The bold type is their emphasis]

I recommend reading the full press release that provides a number of interesting statistics by clicking here. Additional commentary on this study can be found at the Huffington Post.

There’s more. The Kauffman Foundation that specializes in the study and support of entrepreneurism provides a really neat “interactive” demonstration of trends in entrepreneurship at its site. When you arrive at their site, click on “View 1996-2010 Demographic Data”, then “by Age”. If you play with it a little, you will find the data for each year from 1996 through 2010 provided for each age group and for a variety of categories other than age as well. They keep stats on new businesses begun in the US started by entrepreneurs each year. If you dig enough, you will discover that the percentage of new entrepreneurial businesses created by the 20-34 age group has fallen from 35% to 26% over this time period. The percentage created by people in the 55-64 age group has risen from 14% to 23% over the same period. Yes, a shift is underway.

Now, let’s stop and take a breath. In my mind, there is a critical factor that is typically left out of reports and articles like those above. I will share it here in “loud” type because I want to be sure you get it, whether you visit any of the links above or not. So here it is.

You do not need to create a business to be an entrepreneur. An entrepreneur is someone who begins something new, whether that leads to a business or not. The moment you begin your Life Sabbatical, or whatever approach you choose to plan your future, you are an entrepreneur. You are opening your life to new experiences and new growth. That is what it takes to be an entrepreneur. Don’t let anyone tell you otherwise.

I will finish this with two more links, each describing people who began with little or no resources, yet succeeded as entrepreneurs. The first is titled 15 Inspirational Rags-To-Riches Stories and provides very brief summaries of how these people made their way through life as entrepreneurs to success and wealth. That’s fine and I appreciate their stories, but they are not the only people who should be recognized.

The second is titled 3 Incredible Stories Of Entrepreneurs Who Started Off Homeless . It takes a little longer to read and the people mentioned have not become famous or rich, but these stories are as inspirational to me as the others, perhaps more so. The article is well-written and well-worth reading.

The message I want to leave is a simple one. Entrepreneurship has nothing to do with your age, your wealth, your gender, your IQ, your religion, your hometown or any other such factor. It has everything to do with pulling yourself together, getting out there, and trying something new!

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I write when I have the time and inspiration. If you enjoyed this post and do not want to miss new ones when they are published, click here to subscribe to updates to The Retirement Bubble by e-mail. If you prefer an RSS feed, click on the RSS symbol on the upper-right of this page. If you would like to share this with a friend, just click on “share this post” below.

The Washington Post recently published a column by Vivek Wadhwa. It’s the sort of thing that we will read every once in awhile. It makes the case that age does not determine entrepreneurial ability. In this case, Wadhwa argues that being young is not a qualification to be a successful innovator or entrepreneur. I can still remember in decades past when young adults were not considered to be sufficiently experienced to be successful innovators or entrepreneurs, or even managers. There was a “tidal shift” in attitudes and now these articles have to say the same thing, but in reverse. Before all is said and done, I expect we will see yet another tidal shift. Hopefully, this will be one that convinces us that age is not a critical factor in starting something new or better.

I suspect there may be a person or two who wonder how anyone with a name like Vivek Wadhwa could be considered an expert in this area in the US. Such are the remnants of 20th century bias. But reading his professional background should take care of that problem quickly.

I will provide a link to his column which is not all that long, but I would like to highlight a few sentences here. After discussing his own research, he adds,

Kauffman Foundation director of research, Dane Stangler, built on our findings by analyzing Kauffman Firm Survey data and Kauffman Index of Entrepreneurial Activity — which uses data from the U.S. Census. He found that the average age of U.S. entrepreneurs is actually rising, with the highest rate of entrepreneurial activity shifting to the 55–64 age group.

The experience entrepreneurs have gained, the contacts they have made, networks they have formed, their ability to recruit good management teams and their education give them their greatest advantage. Young adults fresh out of school don’t have these advantages.

I could write more, but I would just be repeating what Vivek Wadhwa puts so succinctly. So I will leave you read his column for yourself. I suggest reading it, then returning later and reading it again, just to have it clear in your long-term memory.

You and I may not be the next Steve Jobs, but you and I may need a job in times to come. We need to remember one thing. Our age, whatever it is, will not be a factor, unless we insist on making it one.

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I write when I have the time and inspiration. If you enjoyed this post and do not want to miss new ones when they are published, click here to subscribe to updates to The Retirement Bubble by e-mail. If you prefer an RSS feed, click on the RSS symbol on the upper-right of this page. If you would like to share this with a friend, just click on “share this post” below.

First, a quick note. The article at Barron’s mentioned in the last post can now be read freely at my AmericaWave.com website by clicking here. But today’s post will focus on someone else’s work, a survey by Wells Fargo & Company titled, “80 Is The New 65 For Many Middle Class Americans When It Comes To Retirement”. The results are a bit more involved than that, but this is a press release and its title is designed to catch attention. It certainly caught mine.

As I have said in the past, one thing I want to share when the opportunity arises is any news on the changes in attitudes regarding retirement among the general public. This press release is one of the most detailed I have read and provides plenty of information. I will give you a link to the full release, but I would like to quote a few comments for you here and comment briefly.

A quarter (25%) of middle class Americans say they will “need to work until at least age 80” to live comfortably in retirement.

I think it is fair to call 25%, “many”, especially since that would have been a totally surprisingly result just a few years ago. Getting most Americans (and many other nationalities) to think any older than 65 would have been challenging. For a quarter of them to shift that up to 80 is impressive. I have often said here in the past that younger generations of adults will be learning from our experience. Their attitudes toward retirement will reflect how well or how poorly those of us over 50 today deal with the financial crisis and our own futures. I expected the optimum “retirement age” to rise in the face of increased longevity combined with reduced finances, but I admit I did not expect to see the shift underway so quickly. Of course, if the economy suddenly takes off, this attitude could fade, but I don’t expect that to happen any time soon and I certainly am not alone. Thinking in terms of what would have before been consider an “extremely late” retirement as a retirement goal is something that will become a habit as the crisis continues and we are faced with having to turn this “sow’s ear” into a “silken purse”. We will do it and this survey indicates the process is underway.

Three-fourths (74%) of middle class Americans expect to work in their retirement years, including 39% of all respondents who will need to work to make ends meet or maintain their lifestyles, while 35% say they will work because they want to, rather than out of financial need.

This is more of the same shift, but I am encouraged that 35% put it positively. The Life Sabbatical is designed to help make that possible for more of us.

More than a quarter of people in their 20s (26%) and 30s (28%) expect no income at all from Social Security during retirement years, and on average, people of those ages expect Social Security to cover only 20% of their retirement funding. By contrast, those in their 50s expect Social Security to provide 36% of their retirement funding, while those in their 60s expect it to cover 46%.

Here we see the results of younger adults already responding to what they see happening among older adults and in their society in general. We also see the continued dependency on government support in older Americans who were raised expecting a different situation when they retired. For many of that 46%, I suspect, it’s a matter of not feeling that they can do anything else but be dependent on government support. Hopefully, more of them will shift to the Life Sabbatical or some other similar approach that convinces them they can do more than that.

Of the 69% of middle class Americans who lack a written financial plan, the majority (60%) either say they are “overwhelmed,” say it is “pointless” or say they are “too far behind to catch up.” Only 24% say it is because they are confident in their ability to retire comfortably.

This is sad, but entirely understandable. The social, economic and political atmosphere we live in on both sides of the North Atlantic these days is simply depressing. The feeling that everything is out of control is widespread in my experience working with older Americans, Canadians, and Europeans. How could they feel otherwise? Things are out of our control and apparently out of our leaders’ control. I may have a positive outlook on life, but I can assure you that I frequently feel “overwhelmed” myself. It is a genuine mess in the North Atlantic and gives every appearance of getting worse before it can begin to get better.

As political leaders consider potential cuts to future Social Security and Medicare benefits to help close the budget gap, 49% of middle class Americans between the ages of 25 and 49 are willing to accept future cuts to help reduce America’s debt burden. Only 28% of those age 50 to 59 and 19% of those age 60 to 75 would be willing to accept cuts.

Here is the onset of the “generation gap” so often mentioned. I continue to feel that “gap” will relate less to age in the future and more to whether a person is paying taxes to support the social security system and similar programs or is receiving the benefits. As the number of those over 55 who are working increase, that gap will narrow and continue to do so as the “new retirement”, however we end up defining it, comes into its own. But as this process begins, the “gap” will at first widen and that is underway.

Economists have longed talked about the massive amount of wealth that will transfer between generations as the Baby Boomers age. But among the middle class, shifting economic realities mean those transfers will often disappoint. Four-in-ten (43%) middle class Americans expect to leave no inheritance to their children due to money needed to support their own retirement. Even among households surveyed with more than $100,000 in household incomes, three in ten people (29%) expect to leave no savings behind.

For years, actually decades, I have heard financial analysts talk about the great economic impact of the fat, juicy inheritances that will be left by my generation to those coming up from behind. I doubted it then and I just don’t believe it anymore. I even suspect those percentages above will rise as more and more of us realize how much we will need compared to how little we have. Too bad, but just part of the shifting reality of retirement and of life in general in the 21st century in the North Atlantic.

I promised a link to the full release and here it is. There is considerably more information than I have shared here. I think it is good for us to occasionally stop and consider how our peers are dealing with life these days. This is one opportunity.

Every Life Sabbatical has its bumps. Unfortunately, I have a good example from my own experience of the last few days and it was a very painful bump indeed.

As I mentioned briefly in an earlier post, I have been waiting for an article of mine to be published at Barron’s, the US weekly “sister” publication to the Wall Street Journal and one of the most respected American financial and business journals. Although Barron’s is found on-line at a very active site, it is first and foremost a print publication. With the craziness going on with America’s not-so-super Super Committee and the disorder found in the eurozone on the other side of the Atlantic, space has been a rare commodity for weeks, but I was told earlier this week that my article would be published in the coming week’s issue.

This is my fifth time to publish at Barron’s and I am always impressed with how dedicated they are to seeing that every word to appear in an issue is exactly what it is meant to be. So on Wednesday morning, I got the expected email notification that the final editing process was underway. Within minutes, no joke, my connection to the Internet and email which had been a little shaky before, suddenly became completely unpredictable.

It was the beginning of a three-day nightmare. I received emails sporadically and my responses were just as uncertain. What was a major problem became worse. Thursday was Thanksgiving Day in the US and staff, understandably, wanted to be with their families. That meant doing two days work in one day. They wanted all editing done by close of business Wednesday, but here I was, unable to respond rapidly.

It got worse and worse. My land line, also connected to my cable modem through which I have access to the Net, went totally dead. We spent eight hours struggling to get edits back and forth. I was reduced to using my cell phone, but the connection to the US was weak and I was constantly losing it. At 7 pm, I received the final draft with a plea to respond as quickly as possible. It had been sent at 4:35 pm. Unfortunately, there was a major error that required correction, plus a couple minor changes required. I called and found them waiting at the other end. But nothing can go to press without my written approval. My editor is insistent on that, but I couldn’t provide it. So it would have to happen first thing, Friday morning.

On Thursday, while they were at their family homes, I was on the phone to tech support again and again, a totally useless effort. If any of you wonder if cable companies in other nations can be as inefficient and uncooperative as those may be in your nation, the answer is yes.

Thursday arrived and all connections were completely dead. I got a cab and headed for their office. I carefully explained to the person there that I had been waiting for five months for this article to be published, that it would be seen by several hundred thousand readers, and that I had set up a website to provide further information to anyone interested. Now I was at risk of losing the article or, even if my phone “okay” was accepted and it was published, I was completely unable to get into that special website, plus another related website, to prepare. It was a disaster in the making and I absolutely had to have the problem taken care of that day. She took all the info and assured me someone would be out to fix it that day.

I waited all day for the “cable guy” and no one came. Near the end of the day, I called to see what was happening, only to be told there was no record in their system of any problem and it was too late to do anything now. The first chance they would have to send someone out was next Wednesday! The lady at the other end was sympathetic, but useless. I was devastated. Months of work and so much hanging on the outcome and here I was, literally out of touch.

Thursday evening, I spent the most stressed out, unhappy Thanksgiving dinner of my life. I am a cheerful person, as my friends will assure you. I always try to keep a positive outlook, but I was stretched to the limit and a bit beyond. I was even angry with life, something that is totally out of my character. This was nothing less than a genuine disaster and I felt helpless.

Friday came without any improvement. Once again, I set out for the cable company’s office. I got bounced around, but eventually found someone who seemed to understand how serious my situation was. Ms. Alvarez went to work on her phone. She told me someone would be out that day or Saturday morning. I grimaced. Saturday morning would be too late and, despite having cell phone contact with Barron’s, I still couldn’t get into my websites.

From there I went on the hunt for an Internet cafe and at last found one. Seated in front of a Spanish keyboard, I finally got all the messages sent that needed to be sent, less than 30 minutes before their absolute deadline. By that stage, given the circumstances, I was corresponding with two editors, two assistant editors, a “fact-checker”, and a sixth gentleman whose role is still unclear! They all took it in stride and were remarkably kind throughout the ordeal. But I could not make the corrections and additions to my websites from an Internet cafe.

Finally, at 4:30 pm on Friday, the cable guy arrived and, fifteen minutes later, had repaired the modem, just enough time for me to send a heart-felt “thank you” note to all my correspondents at the other end at Barron’s offices in New York City and Washington DC. The article has been published and is on the Web this morning. I won’t bother with a link now as it requires a paid subscription, but those who are subscribers will find it as “The Great Escape” when they go in to read the new issue. I am allowed to republish without cost at my own website and I will do that, and share the link with you if any are interested. Finally, my websites are updated as well.

The lesson of this very personal story for you? This was just one step in my Sabbatical, but a critical one. You will face similar steps in your own Sabbatical. Once in awhile, you will encounter a bump that turns out to be a wall, sometimes at the worst possible moment. You won’t be able to climb it by yourself. You will need help. As I have said before, there is no such thing as a self-made man or woman. We are all interdependent and no one makes real progress without the help of others at many different points in their journey, whether they are willing to acknowledge it or not.

I am happy to acknowledge it and Ms. Alvarez will get a very nice box of candy as a small thanks for her help when I was at my wit’s end.

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I write when I have the time and inspiration. If you enjoyed this post and do not want to miss new ones when they are published, click here to subscribe to updates to The Retirement Bubble by e-mail. If you prefer an RSS feed, click on the RSS symbol on the upper-right of this page. If you would like to share this with a friend, just click on “share this post” below.

Today, let’s take a look at some statistics that may surprise you. As I have mentioned in month’s past, I believe in the long run that any conflict over retiree benefits will not be between generations, but between those working and paying the taxes for the benefits, and those not working and receiving the benefits. That will mean the older generation will be divided within itself on this question as more and more people retire later and work longer.

But before we get there, there is likely to be a “generation gap” on this question. The media will push this because it’s a simple story line and it’s “obvious” at first glance. Movements like Occupy Wall Street and reports like mine at America Wave will seem to support that argument as well.

A report released by the Pew Research Center, one of the finest research centers in the US and about as unbiased as it gets, titled, “The Rising Age Gap in Economic Well-Being”, adds strength to this apparent generational conflict and it only takes a few glances at the charts and graphs to understand why. So let’s take a look at two of them. First, we have this.

Wow! Take a look at those numbers. The amounts are in 2010 dollars (that is, they are corrected for inflation). Overall, Americans are a little better off financially in 2009 (the latest figures available, but after the financial crisis was underway) than they were 25 years earlier, but oh my, what a terrible time to be young! Not a very good time to be middle-aged either! How can someone 30, 40, or even 50 look at those results and not be heart-sick (and angry)? Most of them know this is true in general, but when they see the actual statistics, I bet many of them are still surprised at how bad it is. They know who ran up society’s bills and now they have to pay them and their bills. Not a pretty chart.

Okay, then look at a graph, maybe that will be prettier.

Now we are talking actual poverty. Back in the 1967, when I was 22, people over 65 had a tough time of it, that’s obvious. A great deal of effort was made over the following years to correct that situation through government entitlements. Well, we did a great job of it, didn’t we? But look at my generation’s kids and grandkids. I think that’s worth another “Wow”. And note that since the start of the global financial crisis, the gap between the two groups has widened. Now, there’s a real generation gap.

I am not going to belabor these statistics today. I really think they speak very clearly for themselves. My suggestion to all those planning retirement or already retired is that they remember both the chart and the graph above as the debate over debt and deficit reduction rages on, all around us.

We are older and we are supposed to be wiser. We shall see in the months and years to come whether our greater wisdom is a reality or just an illusion.

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If you’d like to read the full Pew Research Center report, you can find it here.

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I write when I have the time and inspiration. If you enjoyed this post and do not want to miss new ones when they are published, click here to subscribe to updates to The Retirement Bubble by e-mail. If you prefer an RSS feed, click on the RSS symbol on the upper-right of this page. If you would like to share this with a friend, just click on “share this post” below.

Recently, Bob Powell, Retirement Editor at MarketWatch, published an interesting commentary on how age affects our ability to handle money. Reviewing a study conducted by professors at Texas Tech and the University of Missouri, Bob says in part,

The scores on a test measuring knowledge of investments, insurance, credit and money basics fell about 2% each year starting after age 60, falling from about 59% correct — hardly a passing grade — for those in their 60s to a dismal 30% for those 80 and older, according to Michael Finke, an associate professor at Texas Tech University and a co-author of the study. Here’s what’s even worse: Our confidence in our financial decision-making abilities rises with age. We are not older and wiser. Rather, we are older, less smart and overconfident.

Whoa! That’s strong stuff, but unfortunately, I can’t say I’m surprised. I would like to think that this will never happen to me, but I know better. I had very intelligent parents. My mother, who lived into her 90’s, was a college graduate, a professional most of her life, and had a very sharp mind. But as she aged, she began to lose her grip on financial matters. Finally, I had to take over control of all her accounts and continued that for a number of years. I was impressed at how alert and intelligent she was, even in old age, but her decline was obvious.

She knew it too, so she was the one who insisted on my taking over the accounts after having come close to making a major error due to the pressure of a “bank officer” who was really more of a salesman for some funds the bank was pushing, really bad ones. Thankfully, she resisted his pressure until I could go over the paperwork with her, but that was the last time she wanted to go through that kind of tension and confusion. I am sure I will join her one day in that respect as well, but I will all I can to put it off as long as I can!

She was a smart lady, she knew when to hand the responsibility over. She was the same person who almost had an automobile accident in her 70’s, escaped without harm, came home, and announced she was no longer a driver. She did not trust her eyes or her ability to react quickly and appropriately on the road. She never drove again. She kept on the move, but learned to use the bus system, and cabs when necessary.

So when I read Bob’s article, it spoke to me. I hope you will take a moment read it as well. Best of all, it includes a “simple” ten-question test that you can take that was used to determine financial literacy at different ages, the study’s results are graphically displayed by age group, and there is a link to a download of the full study for those would like a copy. You can see it all by clicking here.

But there is more to this story. There is plenty of research, a mountain really, that the brain is capable of maintaining itself and improving by pushing it into new areas and learning new skills. The graph at Bob’s article shows the averages of each age group, but it cannot show all the individual results. If it did, we would find some very good results among the elderly and some very poor results among the young. There is no reason why you or I have to be “average” if we choose not to.

But we cannot simply do what we do now, over and over, and expect that to happen. It requires new challenges. The new challenges met in a Life Sabbatical can be a huge help with maintaining and improving your own intellectual performance. You might think that accomplishing this for financial planning purposes would require doing more and more financial planning, but the evidence is that new activities, even if they seem completely unconnected to your financial planning, can have the greatest impact.

An article at Britain’s New Scientist magazine a couple years ago caught my eye. It is one of many like it, but this is one I remember and kept the link and I mentioned it in an earlier post here, Juggling Your Brain. It reported on experiments down at the University of Oxford. It involved, of all things, juggling. The results of teaching participants to juggle had a measurable impact on their brain’s growth and development. An important portion of their brain matter actually grew and the brain’s overall performance improved.

Surprising? Perhaps, but the underlying principle is what counts. Doing what you already do provides maintenance. Doing what you have not done before provides growth, and that growth can help you deal with more than juggling balls.

Go ahead and take the test at Bob Powell’s article. It’s not that difficult and it provides useful information. And while you’re at it, read through that earlier post mentioned above, “Juggling Your Brain”. It will tell you a lot more about the real positive impact of doing something new than simply learning how to juggle.

In any case, remember that you can do something about this. Aging has its effects, but you will not be the victim of your age, if you put your mind to it, literally.

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I write when I have the time and inspiration. If you enjoyed this post and do not want to miss new ones when they are published, click here to subscribe to updates to The Retirement Bubble by e-mail. If you prefer an RSS feed, click on the RSS symbol on the upper-right of this page. If you would like to share this with a friend, just click on “share this post” below.

Indeed, it has been a long time since I posted, but the reason for my absence is also the basis for this post. As I have mentioned before, I have my own Life Sabbatical. My Sabbatical has taken two directions simultaneously. Normally, I would not recommend that. One is enough! But it just so happens that I have two and one of them has consumed my attention. More on that a little later. First, a rough idea of what I’m talking about.

It’s a long story and I will not repeat it here, but in the old proverbial nutshell, I first became interested in Americans relocating to live in other nations back in 2004 when I first settled on Panama as my new home. That led me to contract Zogby International (now IBOPE-Zogby), a well-known opinion survey firm in the US, to implement a statistically-valid survey of the American public on that topic back in 2005. One thing led to another. They completed the ninth such survey for me this year.

My primary Life Sabbatical is focused on development of a neglected, but truly beautiful, area of Panama with great potential. That consumes much of my time and nearly all my other resources, including the financial. But my home nation (like a number of others on the other side of The Pond) is in tough shape. Watching and hearing what’s going on up north is painful. The only thing more painful is not being able to contribute anything of value.

However, when our 2011 survey indicated that those Americans under 35 were the most enthusiastic about relocating, I thought I had a responsibility to share that information. Our surveys are the only ones of their kind, so if I said nothing, nothing would be said at all. I happen to think there are good things about this shift among young adults, but there are also less positive consequences for my home nation if the trend builds, as we found it had over the last two years.

So I added this to my Sabbatical. It wasn’t an easy decision. I dislike getting involved in controversy. Been there, done that, got enough t-shirts, thank you. And pretty much anything said up north these days seems to generate controversy. So I hesitated, then hesitated again. Then I wrote an article and submitted it to Barron’s, a well-respected financial publication in the US where I am a “stringer”. It was accepted.

I could have left it at that, but past experience has taught me that a single article may make a small blip on the radar of a few people, but that’s about it. If it was to be of any use, I had to do more. Let me be blunt. If you’re going to have a shot at getting any attention, 1) you have to have a website/blog and 2) you have to have a video, preferably on YouTube, the biggest video service. That costs money. What money I have is in my primary activity.

So the last few weeks have found me utterly focused on trying to put up something half-decent and respectable on a shoestring budget where the “shoestring” is about as skinny and frayed as it can be! My budget for something like this was minimal (that’s the nice way to put it). I found a couple of the “young adults living abroad” discussed in my article who could help and the work began. I don’t want to think about how many versions of the video we went through, but it was a lot (the spokesperson was hard to work with…me) and I was still sure that it wasn’t good enough, but you do your best with what you have.

Then there was the website. We took a standard blog and had to recode it and reorganize it to fit our needs. At least this is something I had a little experience with, but again, I had one of the guys to help me and that made a big difference. But at least we have something up and I hope it will be acceptable too.

Why is this of any relevancy to you? I know there are people who figure Bob is rich (he is not) and can do a Life Sabbatical easily. Ha! I am here to tell you what I already knew, but learned once again. An activity that is part of your Sabbatical takes work, then more work, then more work. You’re never really happy with what you accomplish, but you just keep plugging along because it’s now part of your Sabbatical and you take it seriously. You also know there is no such thing as a free lunch because you learned that over and over in the years it took you to reach “retirement age”.

You discover you can do more than you think possible on very little money. Sure, it makes life more challenging, but you deal with it. You reach out to others who can help you and hope you can inspire them to lend a hand too. I know one thing from experience. There is no such thing as a “self-made” man or woman. We need each other or we don’t make any progress.

And when you do get into your Sabbatical, there will be times when you simply must put everything else aside and really, really focus. Even if you have the money to pay others to help, it’s your Life Sabbatical and it means nothing if you are not wholly a part of it. You cannot pay someone else to take the Sabbatical for you. Otherwise, you just end up spending a lot of money and not making any personal progress. A Sabbatical that takes you nowhere….well, it just takes you nowhere.

That’s the story. At least you know one thing. Bob is right in there, struggling along with everyone else!

Everything is up now on the Internet, but promotion (same shoestring, just a lot smaller now, so it won’t be paid promotion) will not begin until closer to the article’s publication. If you want to take a look at the video, feel free to do so below and visit the site. And if you’re on Facebook, I’d be delighted if you “liked” it. Finally, if you want to pass it along, I certainly won’t complain! The article will have a small impact. A single article, even in a publication like Barron’s, leads to less visits than you may think, there’s so much out there these days. So “word of modem” will be the primary means of getting the story out.

In the meantime, I will have my work cut out for me and much of my time consumed, but with the Internet work out of the way, I hope to be more regular here! Thank you for your patience.

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I write when I have the time and inspiration. If you enjoyed this post and do not want to miss new ones when they are published, click here to subscribe to updates to The Retirement Bubble by e-mail. If you prefer an RSS feed, click on the RSS symbol on the upper-right of this page. If you would like to share this with a friend, just click on “share this post” below.

My apologies. I’ve been “under the weather” and inactive for a few days, but am getting back to normal now. Today, I would like to introduce you to a “diva”, but not the kind who sings at the opera. This diva is the late Dr. Diva Sanjur, a nutritionist. She was the first Panamanian I ever met and the only one until I arrived in Panama. She was a professor of nutrition at Cornell University where I did my graduate work. Her specialty was nutrition in Latin America, especially Central America and Panama, and she was very highly regarded in her profession.

But Diva was more than a nutritionist, she was a force of nature! She was as energetic a person as I have known, the sort of person everyone noticed the moment she entered the room. Diva was the last person who would ever “fade into the wallpaper”. Very friendly, talented, intelligent, and dedicated, her graduate students loved her and she loved them, although she could be a strict advisor when it was necessary. I took no classes with Diva, although I certainly knew her and enjoyed her energy and enthusiasm, as did everyone else. That photo above is of Diva.

I was not in training as a clinical nutritionist. I was in a separate field called international nutrition policy planning, the interface between nutrition and public health, agriculture, and all other aspects of economic development. However, I was assigned to the nutrition department and all my grad student friends were clinical nutritionists seeking their doctorate degrees. Like all doctoral candidates, they had to present their dissertation based on their original research in a public presentation where they were critiqued (and criticized) by everyone else in the department. I didn’t attend those dissertation defenses as I was not particularly interested in the clinical studies, but I always tried to show up when one of my friends was presenting in order to provide moral support. Otherwise, I was involved in my own work.

In my time there, I only made one exception to my normal practice. My friends told me that Diva was making a presentation the next day on a new approach to determining nutritional status in a village or other area that was quick, cheap, easy, and surprisingly accurate. That caught my attention. In the field, such a break-through would be akin to the “holy grail”. Normally, you had two basic techniques to determine nutritional status. You could take various samples (blood, etc.) and send them to a laboratory for analysis. That was ridiculously expensive and time-consuming in those days and still is.

Or you could take a variety of “anthropometric” measurements (height versus weight, weight versus age, skinfold, etc.). You could do these on-site, but the problem was that it was still very time-consuming and it was not always easy to get the information correctly (try weighing a six-month-old who doesn’t want to be weighed or watch two people take skin-fold measurements and end up with two readings). Then you had to be sure you actually had a representative sample of the total population, a very difficult task in the middle of the Africa, Asia, or Latin America of those days gone by. Even today, it’s not easy to do that in a European or North American community either. So the idea that Diva had come across something “quick, cheap, easy, and surprisingly accurate” was just too much to ignore. I was going to attend and I did.

The years have passed and taken the details with them, but I wouldn’t bore you with them anyhow. Simply put, Dr. Sanjur and her graduate students had chosen a village in Latin America and taken the laboratory measurements necessary to accurately describe their nutritional status. Then they also took all the anthropometric measurements, interviewed the people as to what they ate, observed folks preparing and eating their meals, and so on. They were trying to identify the most accurate measurements outside of the lab, and also look for new potential types of measurement. They created a mountain of data and detail for a small village study.

Hang in there. The relevancy to you is coming.

One of the things they had done was to list all the foods each family ate each week and the best estimate of how much of each was eaten per person by age and gender. It might be three pounds of corn flour, six ounces of tomatoes, and three ounces of carrot, four chile peppers and so on. That kind of study is potentially helpful, but open to all sorts of error as you have to literally stand beside the person eating and weigh everything they eat to get an accurate reading, 24 hours a day (”midnight snacks” count).

Something caught Diva’s eye in that mass of data. She did something very different. She simply added up all the foods a person or family ate in a week. It didn’t matter if they ate two ounces or five pounds. It didn’t make any difference if one was parsley and the other was beef. It didn’t make any difference if one was high in protein and another was high in fat. It could be a spice like coriander that was used in tiny quantities, but she gave it the same weight as every other food. She ended up with some people who ate perhaps eight different foods in the course of a week and others who ate 12, or 15, or 20 and so forth. She listed them by that measurement, than added a second column giving their actual nutritional status determined by lab tests. Amazingly enough, they were very similar. In fact, this list of number of foods eaten was at least as good and often better a predictor of nutritional status than all the others!

That was the best research presentation I ever attended. Instead of the typical clinical questioning that would follow, the room broke into chatter. At Cornell, pretty much everyone had field experience and knew exactly how difficult it was to determine nutritional status at all accurately without obligating a lot of resources in time, money, and effort. Diva’s finding was a real surprise. It wasn’t the kind of food eaten or how much that was eaten, the nutritional status of a person or family could be estimated simply by the variety of foods eaten and that is all. It took the room by storm because, although it was counter-intuitive for biological scientists, it was common-sensical for people who knew the reality of life in the field. It just made sense. As one person put it, “Maybe that explains why we have so many poorly-nourished Americans, despite their income level. If they eat the same breakfast every day, eat most of their lunches at McDonald’s, and eat take-out pizza or Chinese in the evenings because they don’t have the time or energy to cook their own meals, we might be seeing the same principle in action.”

Aha! Now we are at the point in this post where the relevancy of Dr. Sanjur’s study to you and your Life Sabbatical becomes apparent. Some of you may know exactly where you want to go with your Sabbatical, but many people really don’t have any specific idea when they start.

Here’s a suggestion. Whenever you notice something (a book, a website, a seminar or other public meeting, or whatever) that appears remotely interesting and is available to you, take the time to check it out. In English, we have a wonderful word, “dabble”. When you dabble in something new, you just commit a little time and effort to it, not much at all. In truth, little kids dabble all the time. They try out all sorts of things, some of them dangerous, some of them complicated, some of them fun, all sorts of things. In the process, they come across something that really interests them and suddenly they are studying it, not dabbling in it anymore.

After all, even Babe Ruth had to pick up a bat and swing it the first time. Even Albert Einstein had to learn his multiplication tables. No one looked at these little children and said, “He’s going to be the greatest name in baseball history” or “He’s going to be the 20th century’s greatest genius”. No, they all started with dabbling, basically. But it led each of them to what would become their adult expertise. The same thing happened to you and me a very long time ago, even though we probably have completely forgotten our first introductions to what would eventually become our careers.

It has nothing to do with children, folks. It has to do with humans. We cannot expect to find what we want if we don’t look for it. The more places we look, the more things we try, the more we “dabble”, the more likely we are to find something that will satisfy us for years to come. You might say that our eventual “satisfaction status” will be greatly affected by the variety of things we try.

You may know what it is for your future If so, more power to you! But if you don’t, get out there and dabble! You may find the truth to the old adage, variety is the spice of life.

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I write when I have the time and inspiration. If you enjoyed this post and do not want to miss new ones when they are published, click here to subscribe to updates to The Retirement Bubble by e-mail. If you prefer an RSS feed, click on the RSS symbol on the upper-right of this page. If you would like to share this with a friend, just click on “share this post” below.

Working as I do with many people arriving in Panama from North America and Europe has always been interesting, but it has taken a decided twist in recent years. From roughly 2004 through 2007, they came in a “rush”. That is, they had money and they had all sorts of ideas as to what they wanted to do. They were in a hurry to get started. They had their collective foot firmly placed on their accelerator. That was a problem for some. When you move to a new society, you need to relax and get to know it. That takes time.

Since then, the reverse has rapidly become the case. They still arrive, although frequently with less money than before, but they are in anything but a rush. They have raised their foot from the accelerator. Oddly enough, many are much more focused on their old homes, not their new homes. They have trouble taking their eyes off the “train wreck” back home. If they do, their attention is often fixed on money in the form of assets, typically stocks, oil, gold, currencies and other speculations. I call these “the bouncing balls” as that typically represents the shift in their values, sometimes on a daily basis. Peoples’ spirits often rise and fall along with the “balls”.

We humans have a tough time detaching ourselves from the emotions that surround us. This can be a positive thing, but as we all know, it can be negative too. Emotion plays many roles in our lives, but it is always found at the creation of a bubble, gets us excited, and continues until the bubble pops. Then it reverses and drags us down. Emotion can get us out of the bed and out the door for another day when times are tough, but it also can leave us lying in bed, wondering if it is worth getting up.

Controlling our emotions can be extremely difficult when we are surrounded by folks whose emotions are raw and public. In any case, “control” is not what we should seek. That just makes the job tougher. The right verb is “channel”. Positive emotions provide great energy and, if channeled, can get us where we want to go. This is critical to a successful Life Sabbatical, especially if we are surrounded by others with negative emotions.

During troubled times, the “bouncing balls” often include many people in our neighborhoods, communities, and nations, including our friends and family. We cannot ignore them, but we have to pull our eyes, ears, and minds away from them, if we want to get anything accomplished for our futures. Easier said than done, but it has to be done. How? Do I have a simple technique for dealing with this?

Yes and no.

Yes, I have something I do when things are going wrong around me, actually at the time they are an immediate problem. I just think in the back of my head, “this too shall pass.” I repeat those four words to myself as I work through the waves of emotion surrounding me. Those are great words because they are absolutely, always true. Whatever it is you face, however difficult it is, however hurtful it may be, however long it takes, it will pass. Always. That gets me through the immediate moments when the negative emotions run strongest. It has helped me keep my head together many, many times in the past and I expect it will do the same in the future, because it’s true.

But beyond dealing with negative emotional challenges, no, I have no easy technique for the long haul. When we are faced with something negative, that can help us focus on “this too shall pass”. But we have to create the positive for ourselves when we want to make real progress in planning our futures. That takes serious effort. Others may help, but no one can do it for us.

Sometimes it is easy, but every major shift in life brings with it a guarantee of negative challenges. That is just part of life and we know it, so we must not allow it to depress us when it happens. You will have those moments during your Life Sabbatical when you wonder if it’s really worth it. It is. The alternative is to slide and you don’t slide uphill. You only slide downhill.

People often tell me, I can’t do it. It’s too much for me. I know, I feel that way too sometimes. But folks, we have made it this far in our lives having to deal with a lot of negative emotions time and again. We can do it and we know we can, because we have!

If I were to leave you with a thought, it is this. Give yourself a little credit. You’ve earned it. Every time you make a step forward, take a moment to congratulate yourself. Sound silly? It is not. Don’t expect applause from others. They have their own challenges to face. But don’t forget to give yourself a few claps or a quiet cheer when you have taken a step forward, no matter how small.

It makes getting to the next step a little easier.

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I write when I have the time and inspiration. If you enjoyed this post and do not want to miss new ones when they are published, click here to subscribe to updates to The Retirement Bubble by e-mail. If you prefer an RSS feed, click on the RSS symbol on the upper-right of this page. If you would like to share this with a friend, just click on “share this post” below.