He Is Afraid of Running Out of Money in Retirement. She Says Relax.

The first year in retirement is often the most difficult. But it also can be the most crucial, setting the stage for how you’ll fill the years ahead—both financially and psychologically. Stephen Kreider Yoder, 65 years old, a longtime Wall Street Journal editor, joined his wife, Karen Kreider Yoder, 66, in retirement in September. In this monthly Retirement Rookies column, the Yoders write about some of the issues they are dealing with in that first year, offering their different perspectives on what can be a confusing transition.

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Karen

There is trouble brewing in our kitchen.

It’s in the cabinets. They were in the house when we bought it 34 years ago, 1980s oak-panel affairs that haven’t stood the test of time. I’m ready to replace them now that we are both retired and will be spending more time in the room. Steve says we can’t afford it, now that we don’t have salaries.

It isn’t that we don’t have the funds. If we’re to spend on the house at all, he argues, there are more pressing projects, such as electrical upgrades and roofing work. In Steve’s mind, buying new tools (think a welder or a miter saw) to fix things is acceptable. But cosmetic changes? Not so fast.

But our cabinet conflict goes beyond the kitchen. It is really about how Steve’s irrational fear of running out of money can spoil our ability to enjoy some facets of retirement.

We were looking forward to a leisurely train trip to see Steve’s parents in Iowa. When we had to change our ticket dates, Steve cast a pall over the anticipation by fretting about the extra $300 the revision would cost.

Just before New Year’s, we agreed to start giving more generously to charities now, rather than wait until we’re dead and can’t enjoy it. We did give more. Then, in January, Steve wondered out loud if we shouldn’t hold back on increased giving until we’re sure our financial plan for retirement is working.

I can sense that he’s quietly harboring doubts about spending on some travel we’re planning for this year. This, even though adventuresome traveling is one thing we’ve agreed is a priority, while we still can do it. 

“What we spend now won’t get replenished anymore” through paychecks, Steve says. That shouldn’t stop us from spending—judiciously—on things that give us and others joy in our latter years. 

I get it that some people worry more than others. My sister says she frets about running out of money in retirement because “it’s hard to break the cycle of the lean years.” Many Americans have very real worries about running out, including friends who have had to delay retirement.

But Michael, our financial planner, has assured us we’re on good footing. Why can’t Steve accept that the way I do?

Rest assured: Financial security is a blessing I don’t take lightly. I’m not a spendthrift. I have pared down my wardrobe to a few hardworking pieces. I buy food in bulk and rarely use expensive, fully prepared meals. I ride my bike to get around the city, and I use donated fabrics for my main avocation—making comforters for refugees around the world. Jewels aren’t my idea of a good birthday gift.

Increasingly, I prefer preparing a lovely dinner at home to going out to eat frequently—a trend I expect to continue as we settle into post-workplace life.

Which brings us back to the cabinets. Here we are at the beginning of retirement, and it’s hard for me to feel as comfortable in our kitchen as I hoped. Yes, the cabinets work, but they are fading and the doors don’t all hang straight. They don’t give me joy as the rest of the house does. 

We hope to more frequently have large groups over for dinner or to quilt or knot comforters. Such groups often hang out for hours in the kitchen, and a quick cabinet refacing would do the job.

I knew there would be unresolved issues as we entered retirement, but I didn’t realize the cabinets were such a raw topic until I brought them up as an example of Steve’s fear of running out of money. 

The cabinets are still on the table. 

Steve

“You are in good company.” It was our financial planner on the phone a few weeks ago, assuring me that new retirees often worry needlessly about running out of money.

Michael has been reassuring me since last spring, months before I retired and long after he had run scenarios showing our funds should outlive us if we stuck to our lifestyle.

But I just can’t shake the anxiety. What if we have huge medical bills, if the house needs unexpected work, if inflation doesn’t go away or if family members need help? 

And what about all those unknown unknowns? One of my worries at age 25 was that I would still be worried about money after retirement, and here I am.

We know from talking with other retirees that many can’t take “yes” for an answer. A reader of this column emails us: “I have engaged a financial planner that has shared their calculations that we are unlikely to run out of money, but I am still uncomfortable.” She is seeking second opinions from other planners, and I sympathize. 

“You surely inherited that from me,” my 92-year-old dad told me last month. He attributes his own running-out-of-money anxiety to the Great Depression, when his parents lost the farm to creditors and after which the family struggled for decades to scratch out a rural living.

As missionaries in Japan, he and Mom lived on tight budgets and taught us kids to live frugally as we grew up there. Dad worked part time after retiring, partly to allay his money worries. I wonder if I should too, even if it takes away some of the freedom of retirement.

Hiring our financial planner was supposed to assuage concerns. I would not retire, Karen and I agreed, unless he deemed our assets sufficient and laid out a plan to make sure they stayed that way. 

He did. I retired. I stopped worrying. 

For a month. 

Somewhere in West Texas, as we pedaled our tandem bike cross-country on our first post-workplace adventure, I awoke in the tent with that gnawing worry. 

I’d peeked at our bank account, and it was shrinking. No news there: I wasn’t getting a salary for the first time since 1982. But it was still jarring. Until now, when big expenses hit, I told myself that incoming funds would replenish the account. Now, I felt like I was watching a car’s fuel gauge creep down toward a predictable end.

It took a Zoom call with Michael—on my iPhone outside a country store—to get me to stop fretting for a while. “You’re still at 100%,” he said, meaning his scenarios showed us not running out of money. 

We’ve settled on a protocol for when my worries get ridiculous. Karen will ask: “What would Michael say?” The answer, always, is that we’re fine.

I still don’t think we need new cabinets. But we’ve agreed on a compromise: Karen will use her earnings from this column on refacing them. I’ll put my earnings in a stock fund—or maybe buy a welder, which we definitely do need.