Really Bad Decisions

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  • February 24, 2009

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Really Bad Decisions

Who knows? Lee might be racing for bottom rung on the 401k ladder … but, he also knows that his path to wealth lies elsewhere. That, in itself, is a good thing 😉

________________________

How about hearing the worst first?

For 27 of the 40 years I worked in church related ministry, most but not all of the churches I worked for had a retirement plan where I would pay $52.50 per month and they would match it.  Now remember not all those churches were part of that plan, I “could” have done it myself but decided not to more time than not.  The last 13 years I have been self employed and put “nothing into retirement”  I didn’t even have a savings account. I literally lived check to check. I ended up with less than $50,000 in a retirement plan that I am now drawing approximately $435.00 a month.

My wife had a $10,000 in a retirement plan from a previous employer but was used for downpayment of a house years ago.  She has been working for companies that have very small retirement plans and I’m not exactly sure what they are.

LESSON LEARNED:  If I could do this all over again I would put more into retirement and faithfully do so regardless of what the employer did.  I would also have a savings account 🙂

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February 24th, 2009
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Comment Number:
1
Written by:
Debbie
Posted on:
February 24, 2009 at 9:40 am

Lucky for you Lee, you’re not planning to live off a measly retirement fund 🙂

Comment Number:
2
Written by:
Josh
Posted on:
February 24, 2009 at 10:14 am

Sounds like you have something to work with Lee. Is that a typical IRA, or a 401(k), or is it something else?

Comment Number:
3
Written by:
Lee
Posted on:
February 24, 2009 at 11:45 am

Josh, it is actually a 403(b)(9) Retirement Plan for Churches. It is a way to invest tax sheltered money for retirement that is not subejct to certain ERISA requirements such as annual 5500 reporting and the contributions can be matched by a Baptist State Conventions as long as it is designated for retirement. Also I get to claim it all for housing allowance as long as I can document it properly.

Debbie – One of my favorite Bible stories in Matthew 14:15-21 is about the little boy who gave a “measly” 5 loaves of bread and 2 fish to Jesus who in turn “blessed it” and it multiplied enough to feed 5,000 “men” there plus “women & children” who were present. In God’s hands my “measly” can become a lot more. The key is ownership..it isn’t really “mine” it all belongs to “Him”. 🙂

Comment Number:
4
Written by:
Jeff
Posted on:
February 24, 2009 at 8:15 pm

Lee, I had a similar discussion with my father this week.

I’ve been spending money hand over fist lately to fix a few things for my tenants in Virginia and to buy lunches and snacks for all the movers and packers that have been putting all my worldly possessions in boxes. It’s humbling to realize that everything you find familiar can be so easily stuffed in a box and trucked away.

As I lamented about how much money I was spending on others, my father reminded me that it’s all God’s money and we just pass it around.

Comment Number:
5
Written by:
Adrian
Posted on:
February 24, 2009 at 10:12 pm

@ Jeff – We went through the same process and it’s interesting (because most our stuff will be in storage for months while we renovate our new house) that all we really NEED are some clothes, kitchen stuff, bikes, and a filing cabinet (with our personal papers); we can actually ‘make do’ with rental stuff for all the rest … shows you how (not) valuable ‘stuff’ really is. If ‘stuff’ isn’t valuable, then why do we even need (much) money? 🙂

@ Lee – You’ve still managed to put away $40k and build up a similar amount as equity in your home (depending upon current valuations); AND it seems that you have learned your ‘lesson’ on car loans i.e. the importance of not having any 🙂 Puts you way ahead of many …

I agree that if you started over, you should be putting money ‘away’ … where to put it is another matter entirely …

Comment Number:
6
Written by:
Lee
Posted on:
February 25, 2009 at 9:36 am

FUNNY STORY, well maybe not real funny but at least interesting. The other day I was at a meeting with a fellow minister and we went to the book table to purchase the speakers book. I stood there counting my cash to see if I could afford the book while my friend contimuplated which major credit card he would use. As I looked at all the credit cards he had I was thankful that I had learned to stop using the credit cards years ago, even if I had to learn the hard way.

I sort of had my own personal “bail out” years ago, I bailed out of using credit cards. 🙂 Feel pretty good.

Comment Number:
7
Written by:
Lee
Posted on:
February 25, 2009 at 9:54 am

OH BY THE WAY this site and the adventure we are on has engendered a new website that I have produced at http://new-lifesupport.com I address our ten life purpose questions, and also the christian perspective to it. I also have a page for taking my grandchildren through Dave Ramsey’s budget stuff along with a humor page, a diet page and even a link to President Obama’s weekly viedo talks and finally I’ll probably as a book review page soon. Stop by and check it out and of course your comments are always welcomed.

Comment Number:
8
Written by:
Adrian
Posted on:
February 25, 2009 at 9:21 pm

@ Lee – I wonder who’s in better financial shape? The guy struggling to pull some cash out of his wallet or the guy with lots of c/cards? You might be surprised 😉

Good luck with the site!

Comment Number:
9
Written by:
Lee
Posted on:
February 25, 2009 at 9:28 pm

Adrian -My own personal past experience tells me that the guy with all the credit cards is ‘not’ in good shape ‘if’ like me he didn’t pay them off monthly. Just because you have the credit cards doesn’t mean you know how to manage the money they represent.
My life style now is pretty much cash as you go. Credit is a no no.

Comment Number:
10
Written by:
Adrian
Posted on:
February 25, 2009 at 11:21 pm

@ Lee – I learned a long time ago not to look at somebody and try and determine their wealth by their trappings (a) I’m probably wrong more often than right and (b) it becomes a bad example for my own behavior. Sounds like you have found your own path, now we just need to step it up a few notches …

Comment Number:
11
Written by:
Diane
Posted on:
February 26, 2009 at 8:10 pm

@ Jeff – Surely you’re used to seeing all your worldly possessions boxed and moved? Recently we considered my taking a job in Hawaii, but my fiance would have to quit his and spend it writing on the beach, and we figured we could really only stand perfect weather for 2 years, so we would store all our stuff. It is amazing how little you need and how much you want..the little details that make it “home” to you.

@Lee, they do say that what goes around comes around; I hope for you that comes true.

Comment Number:
12
Written by:
Jeff
Posted on:
February 26, 2009 at 9:49 pm

@ Diane – I’m no stranger to moving. This is number seven in 16 years, but this one seemed a bit different. I’m not sure why. Right now I’m chalking it up to the fact that it has been 6+ years since the last move…a record for me. 🙂

Comment Number:
13
Written by:
Retirement Accounts: 7 Case Studies « How to Make 7 Million in 7 Yearsâ„¢
Posted on:
March 11, 2009 at 1:45 am

[…] Lee – Is at (or past) typical retirement age for most of us. He thinks that he has made some (a lot?) of mistakes with his finances, yet he at least has some money put aside. But, it’s not enough to meet his goals … and, is it really enough to live off? […]