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THE SPECIAL YEARS : 50 AND BEYOND: THE TIME OF YOUR LIFE : Routes to Retirement : Different Approaches, Varying Results

May 04, 1989|JIM SCHACHTER | Schachter is a Times staff writer.

\o7 Retirement--some long for it, some detest the thought.

By choice or not, though, most older workers end up retiring; only 31% of Los Angeles-area residents over 55 continue to work. Nationally, only 10% keep working past age 65.

What far fewer do is plan for retirement. Studies have found that 60% to 70% of older people make no specific preparation for their retirement years.

Three-quarters of retirees depend entirely on Social Security--a system never designed to offer a complete retirement income--and the generosity of friends and relatives to support them in their old age. Only 15% of Californians ages 65 to 74 can count on the triad of income sources that financial planners term crucial to a comfortable retirement: a pension, Social Security and income-generating personal assets.

Not surprisingly, then, many older Americans worry about money. A survey by the American Assn. of Retired Persons found that "having enough money" is the biggest concern of people over 40 when they thought about retirement. More than 60% of people still working past age 63 told AARP that they did so because they "need the money."

The most affluent--including those who planned best--are the happiest with retirement. Fully 40% of retirees, the AARP survey found, would rather be working. Income was the determining factor: Those with the least money were most disillusioned with retirement.

Visits with four Southland families suggest that those statistics are valid.

Dennis and Aggie Matthews of Anaheim have had to keep working into their late 60s--with no relief in sight--because a business downturn upset their sketchy hopes for retirement. James and Alexandra Koontz of Palos Verdes have taken the steps they expect will guarantee a secure retirement when Jim stops working in the next few years. Gerard Wright of Simi Valley could have retired comfortably at 65, but his wife Mary's catastrophic illness instead has forced him to be looking for work at 71. Finally, William and Margaret Hall of Woodland Hills are living the good life; a lifetime of careful planning and good health, along with a generous pension, make these truly their golden years.

Planning ahead? Don't talk to Dennis and Aggie Matthews about planning ahead.

He worked 22 years for an automatic-controls company, rising to become a sales manager and expecting to stay till he retired. But he quit in 1970 to start his own business as a manufacturers representative when it became clear that the firm was becoming uncompetitive in the industry.

Aggie Matthews invested her time and energy in civic affairs in Inglewood, not too far north of her childhood home in Wilmington, where her large Lebanese immigrant family owned a thriving grocery that supported more than one household. But after years of working on interracial-relations committees, she decided that the family had to leave Inglewood when gang members beat up their 13-year-old son, Curtis, on his way home from school.

"He came home looking like hamburger," the gregarious, gray-haired woman recalls.

Into Dennis' new business went all their money: his pension payment from his old employer, their savings, most of the proceeds from selling the Inglewood house, an inheritance from her mother.

Fortunately, Dennis, a University of Washington-trained engineer, was a talented salesman, and D. A. Matthews Associates prospered. In the third year, it turned a profit. A few years later, their income was in six figures. Aggie and Dennis paid for three of their four children to attend college. Life in Anaheim, in the big stucco tract house north of Disneyland, was cozy.

"Basically, we were investing our money into the business itself," Aggie explained. "At one point, we expected it would begin to (show a) return, so we could put our money away."

That expectation abruptly crumbled in 1980. The control manufacturer whose line constituted 75% of Dennis' business dropped D. A. Matthews as its distributor. A lawsuit followed, and a settlement, but the Matthewses' finances were devastated. Dennis lost hundreds of thousands of dollars in commissions. He scrambled to find new product lines to support the firm's overhead. Aggie had to go to work as an office temporary. Their youngest child, Marian, had to depend on scholarships to finish college.

Nine years later, the Matthewses, both 67 years old, are paying off loans they took out to salvage the business. "We're gradually nipping at them and getting them paid," says Dennis, a gentle, balding man with silver glasses and a white-silver mustache. Aggie still is working as a temp. And Dennis works more than 40 hours a week from an office at home, trying to rebuild his firm. "The company has not built back up to where it was," he says, "and I don't think it will." Their income now is about $30,000 per year. Neither harbors any thoughts of retirement; they can't afford it.

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