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Sure as the tide, retirement is coming — don’t be caught short

Jun 2, 2020 11:52 AM

The phone rang and when I picked it up, I was surprised that an old shipmate I had not spoken with in many years was on the other end. Tom and I sailed together, me as mate and him as cook/deck hand, on a coastwise tug running between Portland, Ore., Vancouver Island, Canada, and Bellingham, Wash. After catching up on personal stuff for a bit, then sounding more serious, he asked, “Do you know of any job openings in the Seattle area, Kelly?” That surprised me, because the scuttlebutt I had heard from a mutual friend was that Tom had retired from the business and was living the good life in some coastal port on his sailboat. Perhaps guessing what I was thinking, he continued, “I retired four years ago, figuring that I had enough. But I don’t, and I need to start making money.” It was obvious to me that his retirement plans had gone awry.  

The day you begin your maritime career, it may be a lifetime before you have to worry about things like retirement, and whether you will have enough money to live comfortably once you stop working. But ask a retired merchant mariner like my old shipmate Tom, and my guess is that he or she will say the time comes up on you far faster than you’ll realize. That’s why, whether it is a company or union job, before you even set foot on the vessel it’s good to be aware if there are any retirement benefits offered. Don’t do what I did after getting hired by a large West Coast towing company, my first job in the maritime industry. I didn’t even know what my hourly pay was, let alone what my retirement benefits were. It wasn’t until I had been working there for several months that Kimo, a friend and engineer on my boat, explained to me the details of the union pension plan — and how many years of work it would take for me to qualify. When I calculated how old I would have to be before I could collect a pension, I was flabbergasted. 

I decided then and there that the prudent thing to do was to start my own personal retirement fund, with money from my own investments, in addition to any pension to which I might be entitled. I made an appointment with a financial adviser who had an office not far from my apartment. I told him that I had saved $10,000 in six months of work and wanted to start an investment program geared toward my retirement. With his toothy smile eerily reminiscent of a shark, he smoothly presented various options. One thing they all had in common was that each involved paying him to invest my money — with no guarantee of a return. By the time he finished his spiel, it seemed to me that he was more of a salesman than an adviser, and I decided that handing over my hard-earned money for this “expert” to invest just wasn’t the right way for me to go. 

After that experience I decided to learn about investing for myself. I knew about Social Security, having helped my grandmother with hers a few years earlier, and I saw how little that actually amounted to. My dad’s individual retirement account (IRA) could have worked well for him, but he only put money into it sporadically. I read some books and magazines at the local library and learned about 401(k) retirement plans, buying government bonds, and tax-deferred annuities. My introduction to real estate as a retirement investment came after I got married. My wife told me about the benefits and tax advantages of owning your own home — not the least of which, in my opinion, was a life free of rent hikes and overbearing landlords. 

After all my research, I was left with one question that I still had to answer: How much money was enough? Did I need $100,000 for a comfortable retirement? How about $1 million? Or $5 million? The answer, I decided, really depended upon the kind of lifestyle I wanted after I retired. Owning our own home, paid off with no mortgage, was essential for both my wife and I — plus enough monthly income to cover our expenses, and money in savings for emergencies. Following the advice in a couple of books recommended to us, we focused on investments that would help us meet those goals safely and with minimal risk. 

The very nature of our profession, with decent pay and long periods of time off, gives merchant mariners many options and great flexibility when it comes to investing for the future. A good friend and old shipmate, Jeff, retired in his 50s thanks to wise investing in rental houses. I worked with an engineer on a fish processor — he was nicknamed Diablo — who bought a 200-acre farm in Indiana. While he was at sea making the money to pay off the mortgage, he let his family live there for free, and in return they operated and maintained his farmstead until he retired. Dan, an old friend and 1,600-ton master, used a combination of his U.S. Navy pension, Social Security and paying off his condo to finance his comfortable retirement. There are many good investment options out there. The key, in my opinion, is to become informed about the opportunities available to you, pick the ones that suit your needs best, and stick with them as much as possible.

We can no longer expect pension plans and/or Social Security to cover all of our retirement needs. These days, we must be proactive in building up the value of our other assets. It is never too late to start planning for your financial future so you don’t end up working for far longer than you want — or are able to. 

Till next time, I wish you all smooth sailin.’

Kelly Sweeney holds a license of master (oceans, any gross tons), and has held a master of towing vessels license (oceans) as well. He sails on a variety of commercial vessels and lives on an island near Seattle. You can contact him at captsweeney@professionalmariner.com.

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