Retirement Planning Gone Awry: Steve Twomey

Steve Twomey's twists with fate set his retirement plans off course and will require him to work far longer than he'd planned. Courtesy Steve Twomey Close

Steve Twomey's twists with fate set his retirement plans off course and will require... Read More

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Steve Twomey's twists with fate set his retirement plans off course and will require him to work far longer than he'd planned. Courtesy Steve Twomey

It’s shocking how quickly years of financial planning can unravel if you lose a high-paying job and don’t get another one for a few years. Steve Twomey had his first brush with that painful lesson when he lost his job in his mid-40s after a long career in telecommunications. Other twists of fate compounded the pain later in life. Twomey, now 65, told his story to Bloomberg’s Ben Steverman. Below are edited excerpts:

I worked for a company in Pennsylvania for a couple years as the vice president, and then, quite honestly, I got fired. I was unemployed for two years at age 46 and 47. In terms of retirement funds, that absolutely wiped me out.

I was in a really difficult position. You can’t go from making mid-six figures every year and then all of a sudden the next month you get nothing. Trying to recover from that is almost impossible. You may have been in relatively good shape -- I did do all the right planning and all that -- but you can get in bad shape very quickly.

A few years later, I was in my mid-50s trying to catch up. A headhunter called me about a job in Jamaica, and I kind of took a flier on it. I moved to Jamaica, and then they deregulated their telecommunications markets. So I thought that was a good time to take a shot at my own business. My business had a plan to build a network, but the early 2000s were not great in terms of getting money for telecom. That just didn’t work out. Eventually we couldn’t keep up anymore.

I never really got back to a comfortable place. Plus, my wife and family didn’t live in Jamaica, so I was running two homes. I got close to selling the business. I had a buyer, but the government ended up not giving us a license, which the deal was dependent on. That cost me $3.5 million that would have gone in my pocket. When I shut the company down, I had to take Social Security early -- which in its own right is a killer because you lose 50 percent of the benefits.

I always wanted to teach, and I did have an opportunity to do that as an adjunct professor. I make about $34,000 teaching graduates and undergraduates business management at Suffolk University in Boston. When you take Social Security early, you're restricted in what you can earn elsewhere. For every $2 I make, I pay back $1 over the $15,000 limit. So I lose my Social Security for about five months. That doesn’t help much.

However, I love teaching and wouldn’t want to give it up. All I’m trying to do is manage things until the middle of next year. I turn 66, which is my normal retirement age. Then my limit [for what a retiree taking Social Security can earn] goes above $40,000. That will probably straighten things out.

I’ll probably have to keep working into my 70s. I like to travel, and I would have liked to have done a lot more of that in retirement. That’s almost impossible now because it’s just too expensive. Playing golf becomes a challenge because of cost and a lack of free time. I want to have a place in Florida because I hate the winter. At this point that looks probably not possible.

So there were all sorts of great plans, but they had to go by the wayside. Still, teaching is a job in which as you get older, you stay stimulated. You have to keep current. I think that’s good for you mentally.

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