Why didn’t the waiter just ask? The one thing you can do to solve your retirement problems with Ubiquity's Chad Parks, producer of the Broken Eggs documentary.
Chad Parks, founder of Ubiquity Retirement and Savings, and the producer of the Broken Eggs documentary shares a money story of a chance encounter with a waiter who seemed indifferent to his own eventual retirement crisis, and the “aha" moment that followed.
Chad’s Money Story:
Chad Parks: So, when we were on the road trip making the documentary, one of our stops was in New Orleans. The way we got the stories was we literally would just stop and talk to anybody, and sometimes it'd be on-camera, sometimes it'd be off-camera. We were at dinner one night with the film crew and he's asking, "What are y'all doing here?" And we told him we're making a documentary about retirement. That got him talking about his own life, and that he's been a career waiter, and that he has not been able to save substantially, and that he thought that he just... Retirement was a foreign object to him and he just thinks that he's never going to be able to retire.
Bobbi Rebell: About how old was he, would you say?
Chad Parks: In his late 40s.
Bobbi Rebell: Late 40s, so this is a time when it's starting to get real. You're no longer a kid who can kind of say, "Well, I maybe am paying down student debt or I just had a baby. At 40-something, you are definitely an adult.
Chad Parks: Yeah. I think what was really also stood out a lot was that he didn't really seem too concerned about not having savings or a plan. And his attitude was that he just figured that the government or social services would be there to help him and that he'd figure it out. That was a little bit disheartening to hear because if so many people do believe that, then we're really going to be in for some serious problems in the future if everybody has got that attitude.
Bobbi Rebell: And also, he was a waiter and that is the job that is typically not one that has maybe all of the programs and the retirement plans that some other jobs have. So that could also be a factor as we move towards more of a gig economy, right?
Chad Parks: Oh, for sure. The statistics are frightening. More than half of the U.S. working population don't have the ability to save at work. The point of the business is, they're small. They don't think they can afford a small business retirement plan and they don't do it. And so, half of us in this population don't have a vehicle to save easily and efficiently for their future.
Bobbi Rebell: As you had this conversation with the waiter, what were your colleagues and friends at the table, what was their reaction? And was there conversation afterwards about it?
Chad Parks: Well, it definitely proved the point of why we're on the road, right? To kind of understand what the reality of people's understanding of retirement is, what their attitudes are. And I think what we all walked away from, not only with this talking to this gentleman but for most of the people we talked to, was that there's a big awareness that there's a problem, but not many people are doing much about it nor do they know what to do about it. So we likened it to this whole thing of like, we all know we need to go to the gym and work out, but not many of us do.
Bobbi Rebell: What else did the waiter say to you?
Chad Parks: That dependency on social services, it didn't sound like he had much of a plan. And he literally was living paycheck to paycheck. He just kind of shrugged his shoulders and it was like, "I don't know what to do about it."
Bobbi Rebell: Did he ask you?
Chad Parks: Well, I mean, I could preach all day about it, but...
Bobbi Rebell: I mean, I'm saying, did he ask you though?
Chad Parks: No, he did not.
Bobbi Rebell: I say that because part of the problem is that many of us don't ask. So of course, we should get more information, but he, like many people maybe in your film, didn't ask.
Chad Parks: This is a very good observation. Yeah, that's true. I had to stop and think about that and no, he did not ask and had he asked, I might've been able to share some good information with him.
Chad’s Money Lesson:
Chad Parks: So, this concept of retirement is relatively new in our country. Pretty much if you think about after World War II, when the GIs were coming home and the modern corporation went back to building cars and doing what they did, there was this promise of the three-legged stool of retirement which is, you would get a pension plan from your employer, social security was going to be there for you in your older age. And then in the '70s and '80s, we introduced the additional savings vehicle of a 401k. That sounds great, right? You got a guaranteed income, you've got a safety net with social security, and you can augment your retirement savings with a 401k or IRA. Unfortunately, we know today, especially in 2019, that most businesses don't offer pensions anymore. Good example was General Electric having just frozen the pension for their 20,000 employees.
Chad Parks: Social security was never meant to be the primary source of income in your retirement, but unfortunately for a lot of people, that is becoming the primary source. And social security itself may actually end up having some reduction in benefits in 2034, 15 years from now, by about 25% if they don't make any changes to it today. Then that puts the onus back on personal savings, and just as I shared before, half of our country doesn't have the ability to even save at work, and that's where we are.
Bobbi Rebell: That's where we are. And what scares me here is not only, as I mentioned, that people aren't asking and being their own advocates, but our expectations of people realistic in terms of what people earn, what people can realistically save in our world, and our lifestyle expectations. If we're being honest, we have an expectation that everybody has a cellphone and everybody lives a certain lifestyle and it's partially the media, but we also have to own it ourselves. We choose to purchase things or live lifestyles that maybe are not sustainable.
Chad Parks: No, you're so right. And that, I call it, nicknamed this the microwave society, right? Everybody wants everything instantly and want instant gratification. We are marketed to and sold to, we are rewarded with spending. Unfortunately, our attitudes are not the same about long-term savings. It's not really exciting nor fun to see your paycheck go down and to see money accumulate over a long period of time, in this idea that you're visualizing yourself in the future. And this whole concept of asking the average individual to become a savings expert and investment expert, a budgeting expert, to be able to say, this is your magic number, this is when you retire, this is how much money you're going to have, that's really putting a lot on people.
Chad Parks: I was formerly a certified financial planner. I went to grad school for finance and it was, I said, it's a shame I had to go to grad school to learn the basics of personal finance. And so it's really, as much as we try to get people to say, listen, this is your responsibility. Don't forget that the way the world has been set up today is that it's not up to the government, it's not up to your employer. Unfortunately, it is up to you to take your future in your own hands. But at the same time, we haven't equipped you with the tools to do so. So, that's where we kind of have this big chasm as a society that we really need to figure out.
Chad’s Money Tip:
Chad Parks: Yeah. So, as I was saying there, it's hard for people to visualize themselves in the future. None of us want to acknowledge that we're going to get old. It happens to other people. And so, one of the ways that I've found to really help people to drive that point home is to volunteer at a retirement home. These are the people who have lived their careers. These are people who've had the life lessons and the experiences that they're happy to share with you. And when you sit down and you just listen to people tell their stories, you can absolutely relate to them. You can learn, you will be emotionally moved. And hopefully, after some time doing that, you'll go home and you'll start to rethink your priorities and say, "All right, this person seemed to be okay and have it pretty good." Or "this person over here, wow. I really don't want to end up like them. So, what can I do differently today?" And then it's also just being kind and sharing some of your time with people who are in the last stages of their lives and could use a little camaraderie.
Bobbi’s Financial grownup tips:
Financial grownup tip number one:
I am generally against the whole trophy for everything, but when it comes to retirement, making an effort can solve a lot of problems. Just trying. The truth is, you guys are a self-selecting audience. You are interested in money stuff. The waiter probably not listening to this or any podcast related to money that's going to actually help him do something other than quote, figure it out when the time comes. The waiter isn't even asking our guest, Mr. Parks, for solutions. He's not even looking, he's not trying. But you guys are. So pat yourself on the back and definitely an A-plus for effort, because you guys are at least interested and I bet you are in better shape than you realize.
Financial grownup tip number two:
One thing we can all learn from our waiter is that, our waiter friend in the story I should say, is that to some degree, we will all figure it out along the way. Redefine what retirement will mean for you and set your goals, but also live your present life. For example, you could see ads for older couples blissfully traveling the world, on luxury cruises or whatever, but honestly, that may not be for you. You might not suddenly wake up at a certain age and suddenly have this burning desire to go on a riverboat cruise. Maybe you will but maybe not. Your retirement bliss could be totally different and at a different price point, higher or lower.
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