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Highlands Today

Cost Of Retirement Is High

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By Raleigh Whiteman | Highlands Today

Published: October 18, 2007

This is the year that the PW and I are more or less celebrating our 20 years of retirement. It really is less of a celebration for me because I was only retired for three of those years before I realized that we needed another income in order to continue a more than modest lifestyle.

I have never been in a position of not being able to find a decent job because I have had plenty of experience in many hobbies, that while expensive, were capable of earning money if need be.
Not being able to accept a more modest lifestyle may eventually prove to have been a mistake.

In looking around among my friends and peers I am seeing as many as half are perhaps in the same boat as I. Of course I am speculating and have no certification of that statement. I can only speak of my own experience as a federal retiree.

COLA Vs. COLA Increases

Since I retired my COLA (Cost Of Living Adjustment) pay increases have averaged 4.1 percent, while almost every year just the cost of my medical insurance ate up that increase. And the average actual cost of living rose an average of 8 percent. For instance, the cost per gallon of gas in 1987 was $1 to $1.10, now it has an average price of $2.87; That's close to 300 percent in 20 years.Everything else has gone up just about the same.

A house built in the Florida Keys in 1986 for $150,000 is now worth almost a half million. A home bought here in Lake Placid in 1989 for less that $70,000, as a handy man special, is today worth around $250,000 or more.

Inflation Explosion

The cost of living has exploded in the past few years and is causing many to worry about how we can continue to live in the comfortable lifestyle to which we have become accustomed.

From the latest Westpac ASFA Retirement study, which measures the costs of basic budget items and activities, show that the cost of living in retirement has gone up almost 9 percent in the past three years as transportation, food and health costs hit retirees hardest.

Retirement expenses have risen more than general household costs because a larger portion of their spending goes on items hit hardest by inflation.
A couple who want to live comfortably in retirement now need about $48,400 a year. For a modest lifestyle, a couple needs $26,200.

Cause And Effects

Inflation has become a way of life that we have to endure. We all know the causes and have likely contributed each in our own way. We have always sought to make more money and if we were working in sales have always charged what the traffic will bear. Unions are always seeking better wages and benefits for their members and anyone who buys a house expects to sell it for more than what it was bought.

Even dying does not relieve our family of inflation. A notation in a record book of 1907 showed a funeral cost $55.25. That's a little different from the national average these days that tops $6,300; not including things like flowers and grave-opening fees.

Gambling: No Way Out

Many seniors who are still working, buy tickets and read the lottery results daily thinking that is the only way out. Since its inception in 1988 more than 1,000 have become millionaires in Florida, plus thousands of others winning large jackpots daily.

Raleigh Whiteman of Lake Placid can be reached on the Internet at rwwhiteman@comcast.net

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