Case facts:

• Stan and Rebecca are both 39, married for 14 years.
• They have 2 children, ages 7 and 10
• Stan works for the state government while Rebecca is a physician in a private medical practice.  She is a partner in the firm.
• They own a home in the area and a small vacation house on a nearby lake.
• They have a mid-six figure income, mostly from Rebecca’s work, and are good savers.  They don’t have problems paying for their current lifestyle.
• Their concerns:

1. Rebecca doesn’t want to work the hours she does now for the next 20 years.  She wants to scale back some.
2. Scaling back even some however will have a significant impact on her income.
3. They would like to retire at 55 if at all possible
4. They like travel, trying new restaurants, buying the newest tech gadgets.  This is likely to continue into retirement, meaning their retirement income needs will be relatively high.
5. Can they reduce Rebecca’s hours, and consequently their income, and still be able to retire as they planned?

Stan and Rebecca’s situation is one many mid-career couples face in one form or another.  They started their careers after college, did well, and grew into their current positions.  But other parts of their lives changed too.  They met, had kids, got involved in the community, and maybe developed some new interests and goals.  They start thinking they may not want to live the second half of their working careers the same way they did the first half.  Some priorities have changed.

My work with them looked at several areas:

• What was their current lifestyle really costing them
• How, if at all, would that cost change if Rebecca worked less
• For various reductions in work, what would the potential impact be on Rebecca’s income?
• Which expenses did they take on out of necessity, which out of want, and which are just habits they fell into?  

• What are their personal and family priorities-  more time with the kids, travel, the homes they own, their kids’ schools, the cars they drive?
• What would their current lifestyle cost in retirement, what income level could be supported in retirement from a reduced income now, and what would a lifestyle focused on their highest priorities cost?

As we worked together, a clearer picture emerged as to what type of lifestyle they wanted to live.  There were things they did out of habit- expensive things- which didn’t add much to their enjoyment.  They began to adjust and make changes, gradually at first.  They banked the extra money.  As they adjusted to their new lifestyle, Rebecca reduced her work to an income level suitable for that lifestyle.  They will gradually continue that until she reaches the work/time/stress level she’s comfortable with.  The lower cost lifestyle will also mean the money they’ve saved for retirement so far will go further when they need it.  They may not do all the things they were, and they may or may not retire at 55, but then again they may not want to if they enjoy their work and have a satisfying home life too.  They’re an example of a couple who took time to assess their life, to figure out where they wanted to go in the future, and started down the path to make the change a reality.  I helped them understand the financial impact of various choices, and what would be needed to achieve long-term financial freedom.  The specific circumstances may be different, but the process can be the same for many mid-career couples.