Talk about bad timing. Anyone who can start saving for retirement even as late as the forties is lucky. My last child was born after birthday number 40. As a single parent, I was still helping with student loans when I reached the current retirement age and became eligible for Social Security. I resigned my job four years later, not because of age but because I didn't want to work for any company longer than 10 years. The bad timing refers to the fact that the economy tanked one week after my exit. Goodbye to half of the meager 401(k) dollars I had managed to save, mostly from paychecks in the last four years of full employment.
In retrospect, I probably should have waited to collect Social Security. When I chose to work independently, I needed both that check and 401k withdrawals for living expenses. Those included a hefty monthly mortgage payment. With the remaining retirement dollars rapidly dwindling, I turned to the one investment so many of us count on: my house. The time had come to sell before the 401k funds reached zero. That would happen well before my mortgage was paid off.
Of course, the housing market was still hobbling. My financial downsizing would require a minimum selling price in order to buy another place, a smaller one, outright. The sale took seven months to happen, the first six with an ineffective agent and the last one with new agents who were savvy marketers. On the buying end, good fortune came with another agent who recommended an offer lower than I thought would even be considered. Lo and behold, the offer was accepted.
Since I couldn't rely on additional income, my living expenses had to fall within the amount of the Social Security check. By expenses, I mean property taxes, car insurance, so on - everything. Therefore I budgeted very carefully: this much to sell, this much to pay off the mortgage, this much to buy, this much left for an emergency fund. That fund includes a relatively small Roth IRA.
My car will be 10 years old in 2013. With good care, I cross my fingers it will last. But here I am, still retired and maybe not rich, but at least solvent. Although my nest egg is way too small to go places and do things, I'm okay with that. Whatever extra I manage to earn will be earmarked for a fun fund.
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