In Retirement, It’s Time to Put Our Costs Under the Microscope
We discovered all sorts of things we are paying for that we don’t really need or use. But there’s one cost we’re not ready to face.
4 min
The first couple of years in retirement are often the most difficult. But they also can set the stage for how you’ll fill the years ahead—both financially and psychologically. Stephen Kreider Yoder, 67, a longtime Wall Street Journal editor, joined his wife, Karen Kreider Yoder, 68, in retirement in late 2022. In this monthly Retirement Rookies column, they chronicle some of the issues they are dealing with early in retirement .
Karen
“Um, Karen?” Steve said without looking away from his computer. He was using the unnaturally neutral tone that means he’s trying not to sound judgmental.
“Oh, no,” I responded. “What is it?”
His screen showed the month’s credit-card statement. “What’s this bill for $28?” he asked. Then, after a few clicks: “Hmm, looks like it’s each month since August last year.”
We were in the study pouring over our spending records to smoke out what we call “parasites”—recurring costs that quietly suck dollars and give little or nothing in return.
I had no idea what the $28 was for, I said, racking my brain for several minutes. “Oh, wait. Yes, last August was when my sewing machine stopped working.” I had found a website that promised advice on how to fix my Bernina Sport 802. It didn’t help, I took the machine to an expert and I forgot about the advice site.
Here it was, much later, leaching a monthly fee. I must have used the credit card thinking it was a one-off.
Parasites like this were also infesting us back when we were working. But ever since our salaries stopped, each dollar seems to have grown in value. And retirement has given us the time to finally ferret out the freeloaders and to analyse what a drain they are on our wallets.
We decided to review every credit-card transaction and bank debit of the past year—and cancel as many recurring charges as we can.
Some parasites are unwitting, like the help-site bill. Others are for services we once wanted and don’t use anymore—like our Netflix account, which we’d been talking about canceling for two years. It was just $15.49 a month, so did we really want to lose it? Yes. We pulled the plug in October. (Sorry, kids, if you were still tapping in.)
Some sponges aren’t obvious from our statements alone. I recently realised that boxes of our eco-friendly dishwasher detergent were piling up. I thought I was buying online when we ran out but had mistakenly OK’d a monthly subscription instead.
Even where a service is useful, there are sometimes free alternatives. I was paying $14.95 a month for audio books. I canceled and now borrow them free of charge from the San Francisco Public Library. We’ll save nearly $180 a year.
We began looking for leaches more broadly and identified a subspecies: the lost-opportunity parasite. After we retired, we began riding city buses and local rail more often, pulling out adult-rate transit cards we’d accumulated. Then it occurred to us that we were leaving money on the table by not getting half-price senior passes: $1.25 for the bus instead of $2.50. Duh!
More lost opportunity awaited in a stack of gift cards I had rubber-banded together in my desk drawer including several from Barnes & Noble bookstores and Peet’s Coffee. I took a bus to the nearest Barnes & Noble, learned there was $30 on the cards and did some early Christmas shopping. All together, the gift cards were storing $225.
The $28-a-month parasite tracing to my sewing machine proved easy to exterminate. I called the customer-care number, negotiated a partial refund of $84 and canceled the subscription.
That will save $336 a year, enough to pay an expert to fix my Bernina several times over.
Steve
There’s a parasite down in the garage, it occurred to me after a bill came in the mail from the DMV.
The letter asked for $162 to renew the registration on my vintage Honda CB750 for a year. I nearly paid it, as I’ve done annually, each year vowing to tune the bike up and get it back on the road within months.
It’s one of two old Honda motorcycles that I’ve written about before—how they once brought me joy in the restoring but now are mostly garage gewgaws.
Our anti-parasite crusade forced me to get honest with myself last month. I could no longer use the excuse that I’ll get to the 750 after I retire. I’ve had two years, and I’m not likely to get to it next year.
So I registered the bike for non operation at $27, saving $135. Now I need to phone our insurer and back out of the $436-a-year policy on the bike. Between those two parasitic bills, I have probably paid more than the value of the bike over the seven years that I haven’t ridden it.
Maybe I can get the other bike on the road, the CB350F. If not, I’ll assign non operational status to it when the DMV bills me for it.
Still, the hardest parasite to face may be the biggest one of all: our house.
We love being retired in San Francisco, and our thriving neighbourhood has proved to be the perfect environment for a couple of aging city slickers. We are walking distance to restaurants, shops, libraries, parks and pickleball courts, and a 20-minute bike ride to the beach or nearly any other place in a city full of vibrant districts. Circles of friends are nearby.
Our home is a Victorian museum piece with a classic San Francisco feel that makes us feel even more part of our city.
But it’s too big, and it is increasingly becoming a financial and psychological drain. What we dish out in mortgage payments, home and earthquake insurance, utilities and property taxes could rent us a decent house in the Midwest with money left over to travel half the year.
There’s also the constant maintenance, the bane of a vintage-house owner. Tourists and residents alike love this city’s Painted Ladies, but we owners must fight constant entropy to keep them made up with paint jobs and preserved detail.
That’s not to mention the costs within. A decrepit old breaker box had been nagging at me from the garage wall for years, silently reminding me every time I walked past that we needed to replace it with a higher-amp box that was up to modern code.
I put off the task because of the cost. I could do it myself when I had time, I imagined, and avoided thinking about it—easy to do when life was busy with workplace and family demands.
I finally hired an electrician, who came in September to replace the breaker box and the wiring that fed it. There’s still the balky ancient redwood gutter to fix, and some plumbing issues.
We’re not ready to sell out and move to the Midwest, which we might eventually do when we’re in our slower years. And we can’t stomach the pain of looking for a smaller place in San Francisco.
So we’ll live with this big parasite for now, the elephant in the room as we hunt down smaller leaches.
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As housing drives wealth and policy debate, the real risk is an economy hooked on growth without productivity to sustain it.
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3 minFor decades, Australia has leaned into its reputation as the lucky country. But luck, as it turns out, is not an economic strategy.
What once looked like resilience now appears increasingly fragile. Beneath the surface of rising property values and steady headline growth, the Australian economy is showing signs of strain that can no longer be ignored.
Recent data paints a sobering picture. Australia has recorded one of the largest declines in real household disposable income per capita among advanced economies.
Wages have failed to keep pace with inflation, meaning many Australians are working harder for less. On a per capita basis, income growth has stalled and, at times, reversed.
And yet, on paper, things still look relatively solid. GDP is growing. Unemployment remains low. But that growth is increasingly being driven by population expansion rather than productivity.
More people are contributing to output, but not necessarily improving living standards.
That distinction matters.
For years, Australia’s economic success rested on a powerful combination: a once-in-a-generation mining boom, a credit-fuelled housing market, strong migration and a property sector that rarely faltered. Between 1991 and 2020, the country avoided recession entirely, building enormous wealth in the process.
But much of that wealth is tied to property. Around two-thirds of household wealth sits in real estate, inflated by leverage and sustained by demand. It has worked, until now.
The problem is the supply side of the economy has not kept up.
Housing supply is falling behind population growth. Rental vacancies are near record lows.
Construction firms are collapsing at an elevated rate. At the same time, massive infrastructure pipelines are competing with residential projects for labour and materials, pushing costs higher and delaying delivery.
The result is a system under pressure from all angles.
Despite near full employment, productivity growth has stagnated for years. In simple terms, Australians are putting in more hours without generating more output per hour. The economy is running faster, butgoing nowhere.
Meanwhile, government spending continues to expand. Public debt is approaching $1 trillion, with spending now accounting for a record share of GDP.
The gap between spending and revenue has been filled by borrowing for decades, adding further pressure to an already stretched system.
This is where the uncomfortable question emerges.
Has Australia become too reliant on a model driven by rising property values, expanding credit and population growth?
As asset prices rise, households feel wealthier and borrow more. Banks lend more. Governments collect more revenue. Migration fuels demand. The cycle reinforces itself.
But when productivity stalls and debt outpaces real income, the system begins to depend on constant expansion just to stay stable.
It is not a collapse scenario. But it is not particularly stable either.
Nowhere is this more evident than in housing.
The National Housing Accord targets 1.2 million new homes over five years, yet current completion rates are well below that pace. With approvals falling and construction costs rising, the gap between supply and demand is widening, not narrowing.
Housing is also one of the largest contributors to inflation, with costs rising sharply across rents, construction and utilities. Yet the private sector, from small investors to major developers, is struggling to make projects stack up in the current environment.
This brings the policy debate into sharper focus.
Tax settings such as negative gearing and capital gains concessions have undoubtedly boosted demand over the past two decades. But they have also supported supply. Removing them may ease prices briefly, but risks deepening the supply shortage over time.
That is the paradox.
Policies designed to make housing more affordable can, in practice, make the shortage worse if they discourage development. The optics may appeal, but the economics are far less forgiving.
It is also worth remembering that most property investors are not institutional players. The majority own just one investment property. They are, in many cases, ordinary Australians using real estate as their primary wealth-building tool.
Undermining that system without replacing it with a viable alternative risks unintended consequences, from reduced supply to higher rents and increased inflation.
So where does that leave Australia?
At a crossroads.
The country can continue to rely on population growth and rising asset prices to drive economic activity. Or it can shift towards a model built on productivity, innovation and sustainable growth.
The latter is harder. It requires structural reform, long-term thinking and political discipline.
But it is also the only path that leads to genuine, lasting prosperity.
The question is no longer whether Australia has been lucky.
It is whether it can evolve before that luck runs out.
Paul Miron is the Co-Founder & Fund Manager of Msquared Capital.
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