My friend Rosemary is a lawyer, and up until very recently she was a DINK. Rosemary is now happily married with a one year old son. One day we were discussing our parent’s retirement, since we are both at the age where the baby boomers that are our parents start to retire.
My father retired last June, and he couldn’t be happier. Rosemary told me that her parents did not have any retirement savings and that she will be funding her parent’s retirement. Both of Rosemary’s parents are still currently working, they are both self employed. She does not have to worry about funding her parent’s retirement quite yet, but she may in the near future.
This conversation made me start thinking about my parents and their retirement. Both of my parents will receive pensions from their employers, and starting at the age of sixty they will eligible for our Federal Pension Plan. But, I thought to myself…Will that be enough?
Our parents come from a generation where kids and family were the priority. They did not focus on saving money, and especially not saving for retirement. We, on the other hand, have been taught from a very young age to start saving for retirement as early as possible.
Even $10 a week is a great start, every little bit counts and it will add up over time. With the magic of compound interest over 25 to 35 years we will accumulate a nice retirement nest egg for ourselves. But, if our parents have never contributed into their 401K and they don’t have any personal private savings, will an employer pension and government pension plan be enough to fund their retirement?
The concept of working to fund my parent’s retirement and not my own is a concept that I never really grasped until I spoke with my friend Rosemary. As of right now my father is financially stable in his retirement but, what if he outlives his money. The tables will be turned, and the child will now become the feeding hand to the former provider. Some parents may feel that our financial contribution to their retirement is owed to them. They took care of us for the first forty years, so now it’s time for us to take care of them for the next forty. I am not exactly sure how I feel about that.
My questions to you DINKS are… As young (and successful) professionals are we expected to pay for our parent’s retirement if they are not financially independent?
Does your retirement savings strategy include saving your parent’s retirement?
(Photo by angela7dreams)