A wise Benjamin Franklin once said “a penny saved is a penny earned.” We think he would have agreed that the earlier you start saving money that will supplement your pension in retirement, the more “pennies” you’ll stack up. And the more options you’ll have for your retirement lifestyle.
Andrea Selvidge, who recently retired after more than 25 years with DRS, began contributing to the state’s Deferred Compensation Program (DCP) early in her career. She was motivated by a desire to ensure she would be self-sufficient when she was no longer working.
After years of saving and planning, Andrea retired this past June. She appreciates the flexibility her early focus on savings has given her family. I’m enjoying retirement,” she says. “We’re very much family oriented and enjoy just hanging out with our family.”
For Kay Journey, who recently retired a second time after a post-retirement employment stint with the Department of Ecology, planning for the future goes hand-in-hand with her career choice. Much of her career was spent as an environmental planner, working to preserve and improve the quality of Washington’s environment. “I managed contracts with Super Fund Contractors to clean up sites throughout the state that were on the EPA’s most contaminated list.”
Saving for retirement has also been a priority for Kay since early in her state career.
“I’m a big fan of saving for retirement,” Kay says. “I saw so many close family and friends trying to live solely on their retirement income or Social Security. It wasn’t easy for them.”
Several years into her career, Kay decided to meet with a financial planner to create a savings program.
“He helped me work out a retirement plan, and a fairly substantial portion of it revolved around deferred compensation.”
Kay and her husband Vaughn, who was also a state employee for many years, were both DCP contributors. Unfortunately, Vaughn passed away unexpectedly in 1996. However, the retirement savings that both Journeys had accrued has had a positive impact on Kay’s life after retirement.
“Although the future didn’t turn out as we planned, his contributions made a big difference in the quality of my life after he was no longer with me.”
Like Andrea, Kay has also enjoyed life after retirement. She says that she has spent about six months working on her “to do” list, which included several trips to see friends and family.
“It’s been a great experience so far. I’ve had very few time constraints for the first time in over 32 years,” she says.
Enjoying retirement. That’s really the goal not only for DCP, but for other savings vehicles like individual retirement accounts and personal savings plans.
Regardless of where you are in your career, and whether it’s DCP, an IRA or other savings plans, getting started today can pay big dividends after you retire.
Information about DCP is available on our Web site at www.drs.wa.gov/dcp.
Who knows? If you start soon, you just might find that the wise Ben Franklin vastly underestimated the power of a penny saved.
November/December 2007 Retirement Planning Edition