My friend, Al Levi, once described life as a four-page folded brochure, with each page representing 20 years. As I turned 61 recently, I am on the fourth page. Just sayin’, I was on the second page about a dozen heartbeats ago, or so it seems. There is nothing as perspective-gathering like a birthday.
If you are looking at the fourth page of the brochure in 2020, you are probably a bit introspective. Perhaps you are thinking about retiring? Maybe selling your company? Maybe downsizing and reducing assets as well as responsibilities? Or perhaps you are feeling the itch to do lots more before you get to the end of the page. Let’s explore!
What is enough?
"Look at where you are. Look at where you started. The fact that you're alive is a miracle. Just stay alive, that would be enough." — Eliza Hamilton, “Hamilton: An American Musical”
For many contractors, burn-out is a constant threat. And the COVID-19 pandemic has tipped a few over the edge. They’ve had enough. But do they have enough? Let’s do the math.
According to the Nerds at www.nerdwallet.com: “A common guideline is that you should aim to replace 70 percent of your annual pre-retirement income. You can replace it using a combination of savings, investments, Social Security and any other income sources (part-time work, a pension, rental income, etc.).”
The site includes a handy calculator (https://bit.ly/2ZdwX1v) and offers a wealth of personal financial information in straight forward language.
The Social Security Administration (www.ssa.gov/benefits/calculators) can clue you in as to what your earned retirement benefits are from the U.S. government. Note: These are not entitlements — you’ve been paying for them with every paycheck and tax return.
One way to set up the next page of your life is to sell your company. Currently, many buyers are willing to pay dearly for consistent, turnkey profits. Attend the virtual trade shows this year and keep your eyes and ears open for business owners who sold for big bucks and are finding new ways to stay productive and relevant. Arrange a phone meeting with them and explore what may be available for you right now.
Or you may find that two or three years of focused work to get your company systematized and profitable will be well worth it. At that point, you may choose to sell or not, and those are nice options to have.
You are well-served to have a good financial planner to sort out your income options and sources, as well as the effect on your tax strategy. Be prepared to upgrade if you are currently smarter (and richer) than the planner with whom you have worked with for a long time.
Consider what you want out of life and whether your business can help you obtain it. Lifestyle, responsibilities, income, exposure, company roles — all these things will play into your decision to call it quits or to double down.
Your roles at home will also change. As we travel through the pages of the brochure, we start as children, dependent on our parents. We move to young adulthood, maybe becoming parents ourselves. Then, our kids take off and our parents come home. Sometimes there’s divorce and remarriage. You may welcome bonus kids or the family you create as you move through your brochure.
Maybe you don’t want to retire; you just need a change of venue. You may be sick and tired of snow! Why do so many people retire to Florida or Arizona? Because it’s warm! After so many years in contracting, you may be ready for Hawaiian shirts and flip flops.
You may want to move closer to family. In 1995, Hotrod and I made the difficult and — in hindsight — inevitable decision to stop working together. We sold our plumbing, heating and solar company in Park City, Utah. We bought a farm and moved to the Ozarks; classic mid-life change of course.
My folks were looking to retire and downsize; we sold them on moving out to the Ozarks to live with us. My mom flew out from Salt Lake City to survey their options. I saw her eyes fill with tears as Hotrod laid out remodeling ideas using bright orange spray paint on the dirt floor of an old barn. “This could be the bedroom and over here, the kitchen,” he encouraged enthusiastically.
Despite a rough first impression, they moved out and stayed in our house while Hotrod worked on the build-out. It is pretty motivating to have your folks living with you to get their house done! Putting the second home on the driveway officially turned it into a lane. When you do that, you get to name it. Considering his bossy wife and even more opinionated in-laws, Hotrod chose the name Know It All Lane. Ha!
It was then our life started to take shape in Rogersville, Missouri. My sister and brother and their families moved to the area. My parents’ place became the family and social hub. At Christmas, my sister from Salt Lake and other friends and family would descend on Know It All Lane. We hosted major family reunions and used every bit of our acreage for golf and four-wheeling and scavenger hunts.
Max settled in at school and in sports. He connected with funny, loveable, interesting kids who became lifelong friends. I love the wild and wonderful four, full-throated seasons here, too.
Now, my family is moving on. My mom made a brave and proactive decision to move to assisted living in Ocean City, New Jersey — our favorite place to vacation and near lots of family members. Max and Jules and Lucca are moving to Salt Lake City, and we want to be close to them. I love my family more than anything, and I know it’s time to spend more time with them.
We’ve been looking at property. Part of me longs to downsize. We currently live on 68 acres, and I am OK with the idea of caring for less land. Another part of me knows we are going to need some space — for the dogs and the shop and Hotrod’s endless (and noisy) projects.
Will we retire? I can picture Hotrod working in the industry forever, tinkering and learning and sharing it all on social media and in the classroom — be it virtual or in person. He loves what he does and still approaches hydronics and solar with a beginner’s heart.
As for me, the next 10 years are going to be busy and productive, perhaps my best years yet. I feel as if I am finally achieving a sliver of mastery, having been on the front lines of hundreds (thousands?) of contracting businesses. I couldn’t be more excited about the progress we are making with Zoom Drain franchising.
Retirement? Hardly. I’m just getting started. How about you? Spend a few minutes or a weekend noodling the next page of your brochure. Let me know what this column brings up for you and I’ll run a follow-up!
"I put myself back in the narrative. I stop wasting time on tears. I live another 50 years. It's not enough." — Eliza Hamilton, “Hamilton: An American Musical”