What Baby Boomers Really Want

            Like it or not, the post-war Baby Boom generation makes up over a quarter of the American population. So what Boomers think about, what we aspire to do and what we want to buy, all make a big difference in the American economy and the social trends that shape our lives.

            So I did a little research and isolated ten issues that Baby Boomers are focused on in 2015. If you're a Baby Boomer you may not be concerned with all these items; but my guess is that at least a couple of them will speak to you:

            1. We want a smaller but nicer house. In the 1980s and '90s, Baby Boomers flocked to the suburbs to raise their families. Now the kids are grown, so Boomers are getting ready to trade in their three-or-four-bedroom home for a two-bedroom bungalow with little or no yard. Some may want the charm of an old neighborhood, but most are more interested in modern conveniences and minimal maintenance.

            2. And long to live in a city. Baby Boomers are tired of driving to work, the mall, and the kids' soccer games. By and large we Boomers want to move into more urban areas – but ones that are clean, crime-free and less costly. So goodbye New York, Philadelphia, Chicago and Los Angeles. Hello Portland, Maine, Savannah, Georgia, Austin, Texas, and Portland, Oregon.

            3. We do not want to share their homes. A website called The Street says that despite some reports of a trend toward home sharing – a la "The Golden Girls" – Baby Boomers are not particularly interested in group living. The U. S. Census Bureau confirms that notion, reporting that less than 2 percent of Baby Boomers live in group quarters. Instead, with the kids finally gone, we want to enjoy the freedom of living in our own space in our own way. Most of us want to feather their own nests, not move to a modern-day commune.

            4. But we do want to keep working.  The Street also says that Boomers don't want to retire. Some 28 percent of Boomers claim they will never retire. And 46 percent say they want to downsize their careers but keep working part time in a less stressful job. This desire to keep at least one foot in the workplace is partly driven by economic factors, but also by the prospects for living longer, healthier lives.

            5. We want to travel. And not just to grandma's house. Many of the more affluent Boomers feel the pull of  "name brand" destinations like Stonehenge, the Great Wall, Machu Picchu and the Pyramids. They also want to gaze at the natural wonders before acid rain or the rising tides destroy them – Venice, the Great Barrier Reef, the rain forests, and the Arctic.

            6. We want to stay healthy. Many Boomers flock to the health club and jump into other healthful activities. Even more stand in line at Whole Foods and other natural-food purveyors to reap the benefits of healthy, organic fare. Farm stands are good. Farm-to-table restaurants are better. Home gardens are best of all.

            7. We embrace social media. Facebook started out as a platform for college kids. But now the aging parents of those college kids are all over Facebook, Instagram, Twitter and other social media sites, sharing pictures of their pets, their grandchildren, and their latest vacation.

            8. Believe it or not, we are still dating. According to the U. S. Census Bureau some 65 percent of Boomers are married. But that leaves 35 percent who are single (17 percent divorced, 11 percent never married), and many are still interested in dating, using online dating services, frequenting meet-up groups, and staying on the lookout from the supermarket to their Salsa lessons.

            9. Nostalgia is here to stay. According to my son the music agent, the highest grossing bands are not the favorites of 20-something hipsters, like Jungle, Ratking or The Front Bottoms, but the old acts of yore like Bon Jovi, Fleetwood Mac, the Eagles and Paul McCartney. Meanwhile, what's big on Broadway? Cinderella, Jersey Boys, The Carole King Musical and Wicked, the latest twist on The Wizard of Oz.

            10. We want a slower, easier life. According to the U. S. Census Bureau, Baby Boomers have the lowest rate of poverty among all age groups. Yet we exhibit the highest levels of anxiety. Why? We worry about our health, about losing our friends, about our children moving away. And we feel insecure because of financial issues such as the stability of our pensions and the prospects for the stock market, and all the questions that swirl around the very programs like Social Security and Medicare that keep us out of poverty.

          And here you thought it was easy being a Baby Boomer!

A Man of the 1990s

     I remember the year 1996 like it was yesterday. We had just renovated the kitchen in the house where my wife and I lived for 20 years, where our children had been born and where, in 1996, they were in middle school. It was the year I had lyme disease. The year my company had a big layoff. I was offered a voluntary retirement package at work. I turned it down, and ended up getting a promotion because so many other people left the company.

     For the rest of the 1990s I had a pretty good run at work . . . until 2002 when I was handed an involuntary retirement package. And thus began the next phase of my life, including my years of  semi-retirement (which are still going on). At the same time my wife and I were getting divorced, and soon after that I met B, and began a new life in another way as well. All that just does not seem very long ago.

      Yes, to me, the 1990s seem like yesterday. My kids were in school. I'd go to Little League games; and I'd watch them play tennis and go to swim meets. My parents were still alive, and we'd go visit Nana and Grandpa for the holidays.

     Last night I happened to notice a photograph of my mom and dad that sits on the bookshelf in our living room. I guess it's one of those things that's so familiar, I never really see it. But I saw it yesterday. In a way, my mom and dad still seem like they're here. Like we should start planning to go visit them for the holidays.

     The 1990s have not faded away. I watch Seinfeld reruns on TV. And sometimes Friends as well. The other day I saw that the original Jurassic Park (1993) was on AMC. This summer the latest in the series,  Jurassic World, was in the movie theaters. Plenty of other films from the 1990s come around all the time: Pulp Fiction, Forrest Gump and Shawshank Redemption, all from 1994; Fargo from 1996 (there's now a TV series Fargo on the FX Network); Saving Private Ryan from 1998, and  lots of others -- and all of them seem fresh and modern, at least to me.

     On my Sirius XM radio I have one of my preset buttons on the station playing hits from the 1960s. They sound old and shopworn to me. The 1960s were so long ago, they appear like a dream. But the station featuring music from the 1990s -- those songs are new! Nirvana, REM, U2, Pearl Jam, Radiohead. Aren't they the bands that the kids listen to?

     And, of course, the most powerful political figures of the 1990s are still around. Which begs the question: What about the Clintons?

     I would agree with most experts who rate Bill Clinton a pretty good president, despite his personal flaws. Would I vote for another Clinton in the White House? Maybe. Hillary Clinton may not be as honest as the Pope. But what president is? Certainly, nobody is more "ready" to be president, and I agree with her on a lot of issues -- for example, just last week she came out with some ideas on how to rein in the ridiculous increases in drug prices. She's talking about health care today, just like she was in the 1990s!

     But, actually . . . in the political context, the 1990s do seem kind of long ago and far away. Remember "Don't ask, don't tell"? Would anyone believe, "I feel your pain" anymore? Why can't we find a newer, younger, fresher face?

     Well, you always have doubts. So I don't know what your favorite decade is. But, like I said, I'm a man of the 1990s, which, as far as the past goes, were just around the corner.

What Do Interest Rates Mean, Anyway?

     I don't know if you even noticed, but a few days ago the entire financial world was on tenterhooks, wondering whether or not Janet Yellen and the Federal Reserve would dare (gasp!) to raise interest rates by ... get this, a whole 1/4 of a point.

     Frankly, I don't know what the big deal is. I remember interest rates at 12 and 15 percent in the early 1980s. So a quarter point, to me, seems negligible. Besides, I don't really care if I get the current 0.1 percent interest on my CD, or whether I get 0.35 percent interest. Either way, all I'll be able to buy with my interest is a pack of gum, or 1/4 of a gallon of gasoline.

     So I turned to my friend Jeremy Kisner, Senior Wealth Adviser at Surevest Wealth Management in Phoenix, to do some explaining for us. Here's what he says:

Jeremy Kisner

     Whether you prefer higher interest rates or lower rates depends on whether you are a saver or a borrower. The last time the Federal Reserve raised interest rates was June 2006. The Fed started cutting rates when the economy began deteriorating in late 2007, and it eventually cut rates to zero in December 2008. We are likely to see the first increase since the Great Recession by the end of this year

      Raising the Federal Funds rate is controversial. This is the only interest rate that the Fed directly controls. It is the rate that banks charge each other for overnight loans, and it primarily affects money market and savings accounts. The rate for mortgages is largely determined by the supply and demand for bonds, which the Fed does not directly control. A large group of economists think it is a terrible idea to raise the Fed Funds rate at this time. Others feel it is long overdue.

     Let’s try to understand why.

     The U.S. government has two ways to try to stimulate the economy: Fiscal Policy (government spending) and Monetary Policy (interest rates and money supply). The Federal Reserve is only responsible for monetary policy. The Fed’s two overarching goals are:

     1) Promote maximum employment, and

     2) Keep inflation as close to 2% as possible.

     Maximum employment and low inflation tend to be conflicting goals, which makes the Fed’s job a balancing act. Maximum employment (i.e., low unemployment) is usually only achieved when there is strong demand in the economy. Strong demand for products and services is good for employment but bad for inflation (pushes prices up). The Fed lowers interest rates when the economy is slow in order to stimulate the economy. On the other hand, it will raise interest rates if the economy is overheating and inflation is above its 2% target. You can see how it is difficult for the Fed to please everyone.

     Many people complain that it doesn’t even pay to keep your money in the bank at today’s interest rates. That was the Fed’s whole idea. It was trying to get you to take your savings out of the bank and go invest it in things that create jobs (e.g., new property, a factory, or equipment). The low interest rates of the past seven years have been good for young people who tend to be borrowers and job creators. The low rates tend to penalize seniors who are counting on interest from their savings accounts to supplement their retirement incomes.

     Zero interest rates have helped the U.S. economy recover from the great recession. The recovery has not been as quick or as robust as many would have liked. However, there's no question that the economy is bigger and stronger on almost every measure than it was before the 2008-09 recession.

     The question is why raise rates now? The economy is not in danger of overheating, and inflation is below the 2% target (largely due to the decline in energy costs). There are several reasons but the main ones are:

     1)  0% is an extreme measure, and the Fed likes to have some ammunition in case of a future downturn or economic shock. When rates are already at zero, it has very few tools left.

     2)  Historically, low rates can create asset bubbles. In other words, people start investing in things that don’t make sense. (Has anyone checked real estate prices in Silicon Valley or New York City?)

     How will a rate increase affect the economy and the stock market? Short-term, there is some volatility, but in the medium to longer term, an increase from 0 to .25% should be a non-issue. The Fed just wants to get off of zero. It is unlikely there will be any steep increases from there unless inflation makes a significant comeback.

What's Your Retirement Lifestyle?

     No one admits that they want to be labeled or put into a box. It seems so confining. But, actually, most people do like to have some kind of easy identity. It bolsters their self-awareness and self-esteem, and places them into a group where they feel comfortable.

     So here are the ten basic retirement lifestyles I’ve identified – okay, maybe with tongue-in-cheek. But face it, if you’re retired, you probably fit at least partially into one of these categories. If you’re not retired, maybe this will give you an idea of what to expect after you hand in your papers and accept your gold I-watch.

     Traveler. You’ve already been to the national parks and to Europe. You likely read the New York Times Travel section. Now you’re looking to expand your horizons and hit some of the name brand destinations like the Pyramids, the Great Wall or Machu Picchu. Next you’ll be trying a different twist – not just going to Europe, but venturing to Latvia or Romania; not just visiting France or Spain, but taking a river cruise on the Loire or walking the Camino de Santiago.

     Social Butterfly. You don’t belong to a book club; you belong to three book clubs … or three bridge clubs or three lunch clubs. You feel like a failure if you find yourself at home more than one or two nights a week. You like to dance; you like to party; you like to go to meetings. It doesn’t really matter; you just like to have places to go and people to see.

     The Loafer. Definitely the Type B personality. They watch TV; they are voracious readers; they listen to music. They are at their happiest when wearing a t-shirt and slippers (or barefoot, even better!) and padding around the house feeling comfortable and content. 

     The Dreamer. Physically, you’re at home. But your mind is somewhere else. Maybe you’re planning a vacation, or researching the place where you’re going to retire, or trying to decide on a political cause to get involved in. Your fantasy life is so active that there isn’t much time to actually carry out your plans. That’s okay. Your mind is occupied; you’re not spending too much money; and you’re safe from the dangers of the world. 

     Artist. They carry a camera everyplace they go, and their walls are covered with photographs – big and small, color and black-and-white, pretty sunsets, stately architecture, sharp-angled abstracts. Or they’re into knitting or crocheting or painting or woodwork. They can be found prowling around the arts festivals; or maybe their work is featured on etsy. 

     Athlete. Maybe you play in the over-50 softball league; or you go hunting with your buddies; or play tennis at the club. Whatever the sport, it is what you live for. Then there’s the golfer who is the same as everyone else, but just takes everything a little further. Finally, there’s the fan. He’s got the hat, the jersey, the license plate and season tickets. He’s not the same as everyone else; he’s in a league of his own. 

     The Worker. Some people never retire. They love their work. Their colleagues are their friends; and . . . well, maybe they’re just afraid to go home. If forced to retire, they find another job. They’re consulting, or offering their services to a non-profit, or perhaps they’re at home, down in the basement, working on a craft or home-improvement project. 

     Stock Market Guru. They read Barron’s and the Wall Street Journal. They watch Bloomberg and CNBC. They know about alpha and beta, and price-to-earnings ratios as well as all the trendy new products. Every evening they log onto a financial website and check the balance in their IRA or 401K . Win or lose, they know they are on top of things. 

     The Volunteer. You usually focus on one particular cause. Maybe it’s your church, where you volunteer on the auction committee and help out at the church rummage sale, and sing in the choir and spend Sundays as a deacon. Or, maybe you’re a volunteer fireman, or a member of the Lion’s Club or Kiwanis Club. You’re directing traffic at the July 4^th celebration, grilling hamburgers at the club picnic, serving dinners at the annual fundraiser. You enjoy helping out your community, and you know everyone in town. 

     Professional Grandparent. She babysits the grandchildren two or three times a week. He has installed swings and playsets and ballfields in his backyard. They live down the street from their children. I, myself, do not have grandchildren. But I can see, there is no greater joy in life than being a professional grandparent.

     So where do you think you fit in?

     I can tell you, B is a cross between The Loafer and the Social Butterfly. It sounds incongruous, but she's always going out to meet friends for lunch, or else at church or at one of her book clubs. But when she's not doing that, she's at home in her robe either reading (usually) or else watching TV (sometimes). 

     Me? Well, B and I certainly have The Loafer in common. Otherwise, I'm an Athlete (golf and table tennis, but not a "fan") and The Volunteer (at our community college).

Two Invitations

     I received a comment from a reporter for a national publication with the following request. I thought about doing it myself; but it really didn't seem appropriate for me. My life, my financial life, is perhaps a little too complicated to fit into the profile she's looking for.

     Anyway, reporter Veronica Dagher writes for a major national newspaper. She is looking to "profile a senior citizen who is living on a fixed income and is having to cut back their expenses because of the low-interest rate environment." She'd ask about your finances, expenses and investments; and your picture may appear in the paper.

     If you're interested in participating, email Veronica directly at Veronica.dagher@wsj.com. And tell her you heard about her through me.

A fantasy of the Baby Boomer Blog Carnival

     A second invitation: As some of you may have noticed we have a small group of bloggers that hosts a weekly carnival consisting of the Best of Baby Boomer Blogs. (Hey, who's to say they aren't!)

     We link blog posts, usually once a week, although sometimes we skip a week, in order to share what we're doing, offer different voices and points of view, and not incidentally, try to build our reader base through the links.

     We are now looking to augment our group by a couple of bloggers. So if you're a baby boomer blogger, and think you may have something to add to our group, shoot me an email with a link to your blog at tomsightings@gmail.com., and I'll get back to you with more details.

     Thanks for your consideration, and I hope at least a few of you will take up one of these opportunities. Happy blogging!
     

The Ultimate Question

     At our local arthouse theater I saw a preview for a movie about David Foster Wallace called The End of the Tour, starring Jason Segel. Wallace is someone I'd heard about, but I'd never read any of his books (and I haven't yet seen the movie either).

     His big bestseller was Infinite Jest. I looked it up. It's over a thousand pages long. So I asked my friend -- the friend I call Peter -- if he'd ever read Infinite Jest. Peter is a big reader. He's read everything. But he told me, "I tried to read it when it came out. But I couldn't get through it. The book is incomprehensible."

     That was enough for me. A thousand pages of incomprehensible prose. No, thanks!

      But then Peter allowed that David Foster Wallace had also written several books of essays. "Read one of those instead," he advised. "They're really good."

     Since I was headed to Cape Cod, I picked up Consider the Lobster and Other Essays, published in 2006. In the lobster essay Wallace wonders at length how much pain the lobster feels as it's being shoved into a pot of boiling water. The essay made me squeamish; but it was a good piece of writing.

     All the essays seemed a bit dated, since they were from the late 1990s and early 2000s. In one he goes to Las Vegas to attend an adult film awards ceremony. It's funny it spots, and establishes just how cool David Foster Wallace is. In a review of a John Updike book, he dismisses Updike, as well as Norman Mailer and Phillip Roth, as the Great Male Narcissists -- thus establishing how young and hip he is.

     But it's in an unlikely essay about a new dictionary where he ponders some more important issues.

     For example, Wallace decries the flood of cynicism that has washed over our society, especially in its most devilish form of irony. It's been overused, he says, beaten to death, to the point where no one can escape its clutches. It makes it almost impossible for people to address issues in a serious and honest way. He's writing in the late 90s, which had already seen irony take over as a main form of expression for a quarter of a century. One can only imagine what he might think of people like Jon Stewart and Stephen Colbert, who have built their entire careers on irony.

     Wallace, a self-described liberal, also laments the demise of what he calls the Democratic Spirit, which he admits may have been inevitable. The Democratic Spirit, he writes, is "right up there with religious faith and emotional maturity that people spend their whole lives working on. A Democratic Spirit's constituent rigor and humility and self-honesty are, in fact, so hard to maintain on certain issues that it's almost irresistibly tempting to fall in with some established dogmatic camp and to follow that camp's line on the issue and to let your position harden within that camp and become inflexible and to believe that the other camps are either evil or insane and to spend all your time and energy trying to shout over them . . . It is indisputably easier to be Dogmatic than Democratic, especially on issues that are both vexed and highly charged."

     Sound familiar these days?

     He also touches on the difference between political conservatives and liberals. Conservatives tend to believe in rules and norms that are prescribed by some authority, usually based on received wisdom from dead white males. Liberals reject traditional authority and traditional standards of inequality, but in the process, he fears, they have developed their own even-more-inflexible rules of language and behavior that are enforced by real-world Stalinesque sanctions.

     One outgrowth of all this is politically correct speech. Of course, no reasonably modern person wants to insult other people by using offensive terms, or referring to them in a disparaging way. But does referring to a poor person as "low income" or "economically disadvantaged" or "pre-prosperous" really do them any good?

     No, he says. Instead of addressing the problem, politically correct language tends to mask the problem. Often the use of politically correct language is simply an exercise in self-satisfaction. It "functions primarily to signal and congratulate certain virtues in the speaker -- scrupulous egalitarianism, concern for the dignity for all people, sophistication about the political implications of language -- and so serves the self-regarding interests of the PC far more than it serves any of the persons or groups renamed."

     He goes on: "Strict codes of egalitarian euphemism serve to burke the sorts of painful, unpretty and sometimes offensive discourse that in a pluralistic democracy lead to actual political change rather than symbolic political change. In other words politically correct language acts as a form of censorship, and censorship always serves the status quo."

     It seems you get no dogma from David Foster Wallace. Instead, you get some hard-headed challenges to our conventional wisdom . . . the kind of analysis that makes us look at ourselves, and our motives, in a more honest, revealing and not-necessarily-flattering way.

     Wallace is a sharp, intelligent (if sometimes difficult) writer. But there's one thing that puzzles me.

     Wallace was a pretty good tennis player in his youth. One of the book's entries is a review of Tracy Austin's autobiography. He wonders how Tracy Austin, who was such a virtuoso on the tennis court, could write such a shallow and thoughtless autobiography. How could someone be such a genius in one respect, but turn out to be so boring and vapid in another?

     David Foster Wallace committed suicide on Sept. 12, 2008. And that makes me wonder: How could someone so smart do something so stupid? I don't mean that as an insult. Wallace was clinically depressed and had difficulties with his medications. Still, how could someone who was so smart, who offered so many elegant answers to so many problems . . . how could he not find an answer to the most important question of all: why should we keep on living?
    
    

On Our Minds

     A roundup of baby boomer blogs this week finds that we have an abiding interest in both our mental and physical health.

     Take a drive over to Six Decades and Counting where Meryl Baer examines the rules regarding car seat regulations, and how they may or may not affect senior citizens. She wrote about the problem a few years ago, and has updated the article for her latest post Car Seats for Seniors.

     As for Laura Lee Carter, she's concerned about the stress and the environmental problems of city living. After residing in the city for most of her life, she finally moved to a rural community this summer.

     Since B and I have been talking about when and where we should move in retirement, this is a subject near and dear to my heart. One of our ideas is to move into the city, from the suburbs where we've both been hanging our hats for the past few decades. We're thinking city life would be exciting, at least for a period of time, say a year or two.

     But after reading Carter's post, I'm not so sure. In City Living … Not So Much Laura Lee offers up a few thoughts, along with some informative research, on urbanization and mental health.

     Meanwhile, on The Survive and Thrive Boomer Guide, Rita R. Robison, consumer journalist, warns us about two potential threats to our health. In FDA Issues Warning Letters to Five Companies that Sell Pure Powdered Caffeine, she points out the dangers of the supplement to children and adults alike. Pure caffeine should never be sold to consumers, she says, pointing out that one mere teaspoon can be a fatal dose for a child, and two teaspoons are fatal to many adults.

     In Tiny Concentrations of Teflon Harmful to Public Health, Robison refers to a study by the Environmental Working Group that says federal guidance on safe levels of Teflon in our drinking water is way too weak. One study she cites detected Teflon chemicals in 94 public water systems in 27 states. And exposure to these types of chemicals have been associated with cancer, high cholesterol, obesity and other problems. For more on the issue check out Robison's report and her links to the studies. 

     Meanwhile, if you’re interested in self-awareness, self-improvement and self-actualization, you might want to check out the recent post on SmartLiving365 called Is Finding Your Balance Point a Smart Way to Live? Blogger Kathy Gottberg takes a look at some work by Brian Tracy and his daughter Christina Stein who talk about how each of us has a balance point where "we feel in perfect harmony, grounded, happy, connected to others, and where our mind, body and spirit are in alignment." 

     Gottberg also notes in Wayne Dyer: The Passing of a Self-Help Master that the popular author and motivational speaker Wayne Dyer died last Sunday, Aug. 29. Dyer was suffering from leukemia, diagnosed in 2012, but that never dimmed his optimism and love of life. As noted on the Dyer website: "Wayne has left his body, passing away through the night. He always said he couldn't wait for this next adventure to begin and had no fear of dying.”

     One of Dyer’s famous quotes was: “Don’t die with the music inside you.” So Gottberg has isolated five ways that the music of Wayne Dyer will forever be a part of her life . . . and maybe yours.

Summer Days Are Over

     There are a lot of people living on Cape Cod who (as B and I say when we notice a lot of heads with gray hair) are "in our demographic." In other words, there are a lot of retirees who live out here, not just in the summer, but all year long.

     B and I drove home from vacation yesterday, and on the way we wondered: would we ever consider retiring to Cape Cod? There's an allure. It's a beautiful place out on the seacoast -- peaceful and removed from the world. The summers are on the cool side, and the winters not as cold as the rest of New England.

     A few years ago B and I spent a weekend here in November. It was fun to walk the windy beach and watch the waves scuttle to shore. The air was bracing, and the fire at the local restaurant very inviting. But it was also gray and raw and blustery, and seemed lonely with the vacationers long gone.

     And yet, thousands of retirees call Cape Cod home. Most of them come from New York or New England, but some from farther afield. A lot of them go away for at least part of the winter, usually to Florida. But there's another reason besides the weather:  If you stay in Florida at least six months, you're considered a Florida resident, rather than a Massachusetts resident. There's no state income or estate tax in Florida as there is in Massachusetts.

     But there are always exceptions. We met one couple that spends the winter in Aruba rather than Florida. Another fellow chuckled when he told me with undisguised happiness that he and his wife had just retired last year. They moved here from Connecticut. He said people think they're crazy because they don't go south in the winter. They have a house on the Cape, then go Vermont for the winter. Why? They are skiers.

     Personally, I wouldn't want to winter over in Vermont. I used to do some skiing. But I gave it up six years ago after I fell and broke my arm -- and realized that skiing is not a good thing to do for people "in our demographic." At our age, when you fall, you're more likely to get hurt, and it takes longer to heal.

     No. I don't think we'll retire to Cape Cod. We'll be back. But for now, the summer days are over on the Cape.

September sunset over Bass River on Cape Cod

Do We Make Our Own Luck?

     The following short passage comes from Live by Night by Dennis Lehane, a book I'm reading on vacation. Lehane is author of a dozen novels, including Mystic River, all set around the Boston area.

     The time here is the 1920s. The son, Joe, is a small-time crook who has been beaten to within an inch of his life by a couple of gangsters. He's now being transferred to jail from the hospital, and his father comes for a visit . . .

     "People don't fix each other, Joseph. And they never become anything but what they've always been."

     Joe said, "I don't believe that."

     "Don't? Or won't?" His father closed his eyes. "Every breath, son, is luck." He opened his eyes and they were pink in the corners "Achievement? Depends on luck -- to be born in the right place at the right time and be of the right color. To live long enough to be in the right place at the right time to make one's fortune. Yes, yes, hard work and talent make up the difference. They are crucial, and you know I'd never ague different. But the foundation of all lives is luck. Good or bad. Luck is life and life is luck. Don't waste yours. It's leaking from the moment it lands in your hands."

     Joe's jaw clenched, but all he said was, "You make your luck, Dad."

     "Sometimes," his father said. "But other times it makes you."

What's Going On Here?

     You can go on vacation, but you can't get away from your IRA account.

     I've been away for less than two weeks, and Wall Street has gone crazy. What's a poor retiree to do?

     Well, if you're a poor retiree living on Social Security alone, then you probably don't care. Or if you have a good pension supporting you in retirement, then it probably doesn't matter much to you either. But for those us who have no pension, and who have spent a good portion of our lives saving up for retirement . . . that's all we've got!

     So what happens next? Nobody knows -- not your broker at Merrill Lynch, not the expert holding forth on CNBC, nor the reassuring missive that arrives by email from Fidelity or Vanguard.

     I guess we all have faith that over the long term the American economy will continue to prosper and corporate profits will grow along with it. And therefore the stock market will reward those of us who invest in it, either directly in stocks or mutual funds, or indirectly through some retirement plan. If you don't have that faith, perhaps you should be investing in Asia, or gold, or hiding your money under the mattress.

     Regardless, in the meantime we should all keep plenty of cash on the sidelines. Here's the best advice I've seen on that score.

     All the financial experts say you should set aside some kind of emergency fund so you're not forced to sell your assets in the middle of a crisis. Many recommend keeping enough cash outside your retirement account to cover six months of expenses.

     But here's the alternative I like better: Figure out how much you typically withdraw from your savings to cover the gap between your ongoing expenses and your recurring income from pensions, Social Security and anything else. Then set aside enough cash -- it can be inside or outside your IRA, it doesn't really matter -- to cover the gap for five years.

     Yes, five years. That's so you don't have to sell investments when they are down. (You didn't want to be forced to sell your stocks cheap in 2008 or 2009. But you didn't want to sell them in 2010 or 2011 either, not when they were going to be worth a lot more in 2012 and 2013.)

     But the amount you should keep in cash may not be as much as you think. For example, if you spend $3,000 a month, and take in $2,500 a month in pensions and Social Security, you have a $500 per month shortfall. So $500 a month for five years equals a cash balance of $30,000.

     Of course this is just an example, and there's always room for adding or subtracting a little bit here and there (subtract some if you really don't have the savings; add some if you're worried about a sudden emergency expense, or a return of inflation). But you get the idea.

     And besides, maybe the market will go up again next week, and all our worries will be over. I doubt it; but it could happen.