Michael Mihalik's Debt is Slavery
Chapter 5 is all of four pages. Near the end he says:
“If you won a multi-million-dollar lottery today, would you go back to work tomorrow? The majority of people would be happy to tell their bosses to take a hike. That's because retirement is about money, not age.“ (emphasis mine)
One gentleman a few doors down from me at work has been working where I do for over fifty years! He obviously loves what he does. He is, for all intents and purposes, retired. Nobody is telling him to come to work. He's not who I'm going to talk about.
I don't think I could say the same thing for most seventy-year-old retail workers. Not all, but most. The majority of them probably need the supplementary income.
They're “retirement age,” but they're not retired. They're working because they need the money. It's probably not at all what they expected of their sunset years. If they didn't need the money, I'm almost positive they wouldn't be working retail! I have yet to hear anyone who's worked retail tell me it's easy. They'd be spending time with their families, traveling, gardening, listening to classical music — whatever interests them. Heck, I'm 35 and I'd rather be spending time with my family than working for someone else!
Debt will kill your retirement. The magic of compounding is there, but it's evil magic — the compounding is working against you rather than for you. It scrambles your nest egg. I'm not immune either — debt will kill my retirement if I let it! And it probably would kill my wife's retirement too if I really let it! “Retiring at sixty-five” may turn into “retiring never.”
When I'm sixty-five I want to welcome my grandchildren into my home. I don't want to say “Welcome to Wal-Mart.”
(Here are links to parts one, two, and three of this series on Debt is Slavery
While the idea of being debt free is a common one (especially as people near retirement), I still fail to understand the "all debt is bad" mentalilty. At the end if teh day, debt is a lever. Use it well and it can be a very good thing. Use it badly and it is a very bad thing. Personally, as long as the cost of funding is meaningfully below the expected rate of return, I like using debt with my investments.
I'm not alone in reaching this conclusion: http://aprivateportfolio.blogspot.com/2007/04/con…
MBH,
I would add a good retirement is also about health – good health and good health insurance. Combine that with the right amount of money, and one can retire at any age 🙂
I also agree that debt can be a BIG hinderance to retiring.