How the trade war could affect one couple's retirement plans
Gail and David Rhames live just a few steps from a quiet hiking trail in Hooksett, New Hampshire.
“Okay, so this is one lookout,” said Gail, pointing down at the New England town along the Merrimack River. “And then all of this is our neighborhood.”
The Rhames are an outdoorsy couple who like to camp, fish and ski. Their sense of adventure is partly what sparked their attraction for one another.
“Gail’s one of these skiers you see that you say, ‘Wow, wish I could ski like that,’” said David.
These two used to be double black diamond skiers, but now they stick to regular black diamonds. Skiing doesn’t come quiet as easy as it used to. David is 67 years old and Gail is 64 years old. He retired last summer, and she hopes to retire next year. They’re looking forward to spending more time with their two sons, who are both in their 30s. They bought a camper trailer so they can adventure around the U.S. David lost 70 pounds.
“Thankfully, I’m in good shape, I’m healthy,” said David. “I can finish off my golden years, if you will.”
David used to work at a company that made specialized ultrasonic machinery for airplanes, and he was ready to retire. But Gail is a little apprehensive about leaving her job as a college administrator. Retirement requires a mind shift to be comfortable spending what they’ve saved.
“So you can enjoy being at home and doing the things you want to do,” said Gail.
David and Gail like near a hiking trail in Hooksett, New Hampshire.
Kristin Schwab/Marketplace
Gail and David are adjusting to living off less. Together they used to earn about $145,000 a year. They haven’t started drawing from David’s 401k yet, so they’re living off Gail’s salary of $60,000 and his social security. They’ll be fine covering their monthly expenses, about $6,000. But it’ll require a little more budgeting, which David has taken over.
“Gail has always been in control, really, of the spending,” said David. “And now I’m seeing all of these things, and I’ve been enlightened, for lack of better words.”
This is a familiar theme in a lot of households: One spouse oversees the budget and does the shopping, while the other maybe can’t rattle off the price of a gallon of milk. In retirement, David is figuring out what life costs at a time when life costs a lot more than it used to.
“Every month on groceries? We’re spending about $1,300,” said David.
“No, you said 11,” interrupts Gail. “I’m the penny pincher, so I heard 11. He’s the manager, so he kind of, his numbers float.”
They took stock of their fridge the other day and found 21 different types of cheese.
“And we buy this $3 or $4 item that we might use once,” said Gail.
It seems like everything is more expensive these days, including electricity, heating oil and lift tickets at their local mountain. Their home has doubled in value since they bought it less than a decade ago, which sounds great except it means they’re paying more in property taxes. And with David’s fixed income, he’s nervous.
“It’s going to be harder for me to absorb these things,” said David, “so it’s scary.”
What’s adding to the Rhames’ anxiety of transition into this stage of life is economic policy. The stock market has been swinging over the last few weeks because of President Trump’s trade war. Over the years, the Rhames have been loyal Trump voters, with their priorities being the economy and inflation.
“He is a little rushed,” said David about Trump in his second term. “Maybe that was his plan. I think he should have gone, or should go a little bit slower and not get people so excited.”
“Nervous,” replied Gail. “People are nervous.”
David and Gail are loyal Trump supporters, but are a bit nervous about his economic policies.
Kristin Schwab/Marketplace
The two have decidedly not checked their retirement accounts. But they said the markets and the economy could affect their future plans.
“I mean, if it goes really bad, who knows what’s going to happen next?” said Gail. “It’s not like we’re 30 and we can recoup. So it would impact the retirement. I’d have to feel secure before I make that decision to stop work.”
The Rhames have been planning and plotting and waiting for this transition. They’ll celebrate their 40th anniversary in November.
“It’s almost like a second marriage for us, second honeymoon,” said David. “We do everything together.”
“Buddies,” echoed Gail. “Partners in crime.”
Adventurers in crime, really.