60 Is the New 20

Unless you find yourself sipping Mai Tais on the Riviera at 60 years old, unless you can comfortably live off your savings and spoil your grandkids rotten with trips and toys, unless you’ve stopped working voluntarily and paid your final mortgage payment, you’re not really retired. At least not in the American Dream kinda way. We’ve got Betty White and the Golden Girls to thank for that disillusionment.  And remember those lucky dotcomers (the ones who got out early) who enviously retired at age 32? The real estate flippers who made millions in just a couple of years?  The YouTube (Stock Quote: GOOG) founders who turned a video web site into a billion dollar deal? These exceptional people reinforced the blissful notion of early retirement to an entire nation of hardworking 9 to 5ers.  I want that, too!

But millions of dollars is likely what you’ll need to retire early and comfortably in the United States, assuming you want to maintain your standard of living for the next 30 or 40 years.   And even if you do plan to retire at around 65—and you’ve been building up a nest egg—you may still face some financial challenges. 

For those nearing retirement now, a more realistic approach to your next few decades may be to act (in some ways) like you’ve just come out of college.  (Bear with me).  Consider that Social Security payouts won’t necessarily pay the bills, your 401(k) may have gotten halved over the past year and health care is still a huge question mark.

Here are some 20-something financial solutions for the 60-something retiree.

Secure alternative health care. The average college student right now has maybe a 50/50 chance of getting health care after graduating. Maybe their new employer will pay for it, but there’s no guarantee, especially if it’s a small business.  Maybe they jump on their parents’ health care plan, but that’s only viable for a short while. You may feel a bit stuck, especially when that toothache is starting to keep you awake at night and you’ve no disposable income to put it to rest. Such is the predicament for many retirees who no longer receive health benefits from their previous employer, except when you’re 65 it’s not just a toothache. It may be several prescriptions, an unexpected procedure and eventually long-term care.

Where to turn?  The good news is President Obama’s stimulus bill has more than $20 billion tucked away for investing in the health care industry.  For now there’s Medicare, but it has its limits.  The federal health care plan doesn’t cover most at-home care or pay for assisted living.  So, much like in your 20s, you need to think outside the box when it comes to getting adequate health care coverage.  Here are some ideas:

• You could enroll back in school (like some 20-somethings do). More retirees are moving to college towns for their vibrant social and cultural lifestyle. But by enrolling in a single class retirees may be eligible for the school’s group health policy. Many schools are known to extend their group insurance rates to both full- and part-time students.
• Consider working a few shifts in retail. A Merrill Lynch New Retirement Study from 2006 found more than 70% of boomers say they will continue to hold a job after retiring.  That percentage has probably only gotten greater amidst this recession.  Borders (Stock Quote: BGP), Costco (Stock Quote: COST), Gap (Stock Quote: GPS), Petco, Whole Foods (Stock Quote: WFMI) and dozens of retail outlets that offer exceptional health care benefits to both full- and part-time employees.
• Your county or district may have free medical clinics for the underinsured or those without any health coverage. The Department of Health and Human Services has a great site to find a free medical clinic or camp in your area. There are also retail clinics that charge a flat fee and offer a limited number of minor checkups, such as a throat check or an eye exam.
• Talk about it! As I advise to young adults to talk to their parents about finding solutions, you should have a talk with your children before you retire to talk about ways to afford the medical care you may need in the long term. It may make sense to take out a long-term care policy.