Saturday, January 18, 2020

The difference between wealth and income

We continue to have growing pains with Belladonna's re-integration into the household. Nothing dramatic. Just readjustment of outdated perceptions.

Both Bella and Kubota view us as wealthy, or at least quiet well-to-do.

From one perspective, they are 100% right. Anybody who is married to their first spouse IS wealthy.

They look at the house and property. We made our last house payment in 2008. They think we are swimming in cash.

Bella scheduled an appointment to have her hair "done". Then, the night before she went in for the appointment she asked when we were going to give her the money.

That triggered some hard discussions.

I asked her "How much money could you expect to  make if you went to work full time?"

She mentioned an annual amount that was about twice my starting salary in 1981.

Then I asked her "How much do you think my pension is?"

She had never thought about it. She shrugged her shoulders.

"It is about 1/3 of what you would make if you worked full-time in your field." I told her.

There were many secondary issues. Bella is going back to school to get into a more saleable field. She is only working part-time. There was a hiccup in her work hours when she moved from Grand Rapids back to the Lansing area.

It never occurred to her that Mrs ERJ was working full time and I had just retired when she went away to university. Our free-cash-flow is much, much lower than it was when she left.

We are wealthy because we own several durable assets free-and-clear, but we are modest-income because our cash-flow is much lower than it used to be.

My plan is to work for another three or four years after Kubota leaves the house, God willing. Social Security takes the average of one's best 35 years income. I worked full time for 32 years but the first year and the last year were half-years. Basically, I have three goose-eggs and that will lower my SS benefits by almost ten percent.

Oh, and I could use the money.


  1. Yep, time for 'that' talk... We aren't rich...

  2. My Dad told me at some point, "I make my money the same way you do." I've used that several times since with the additional notice that there is no money tree in the back yard. When our teenagers wanted stuff, we showed them income and outgo, it scared them. They all went to work (after school) and bought their own stuff. Their desires changed after they started using their own money to buy things.

  3. I used the helpful calculator at Social Security and found out it was about $10/month at 62 for every year I retire "early".

    Not a big mover for me.

    Now medical care . . .


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