07/21/97 'THERE'S NEVER ANY REASON FOR US TO BE BORED'

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'THERE'S NEVER ANY REASON FOR US TO BE BORED'
You can be as active and mobile as ever in retirement--if you plan for it
When Edna Cohen first logged on to the Internet a few years ago, she was too overwhelmed to use it. But Edna, 79, and her husband, Aaron, 80, a retired Defense Dept. statistician, are giving it another shot: The Delray Beach (Fla.) couple is signing up for a one-week Internet course at an elder hostel at Mary Washington College in Fredericksburg, Va. After that, they're off to Baltimore for a class on the paintings of Marc Chagall. Such trips are mere jaunts for the Cohens, who regularly travel to Africa on safari. ''I am mad for wild animals,'' says Edna. ''There's never any reason for us to be bored.''
More and more retirees like the Cohens, in good health and with their finances in order, are packing their days full of learning and adventure. And they are doing it with more energy and enthusiasm than college kids on summer break. Others, pursuing lifestyles once reserved for the rich and famous, are settling into bicoastal routines to share time with far-flung friends and relatives.
MORE CHOICES. Then there are those who really don't retire at all. Instead, they arrange to go right on doing what they've always enjoyed, albeit at lower pay or through volunteer work. ''When my father retired, he put his feet up, turned on the TV, and waited to die,'' says Eugene Slevin, 74, a retired marketing consultant in Peoria, Ill. ''I want to die with my boots on.'' Slevin now volunteers several hours a week to help low-income families prepare their taxes.
Sure, there will be time to kick back, if that's what you really want. But the retirement game has changed drastically in recent times. That's mostly good, but it can also make planning for those golden years vastly more complicated than in generations past. Careful preparation is the key. ''For the first time in history, older people have a plethora of choices,'' says Ruth Cohen, a Beaverton (Ore.) geriatric specialist (no relation to Edna and Aaron). ''But unless you have a plan, you're not likely to get what you want.''
For starters, do your homework before you pack it in. ''Try to schedule out how long your funds will last,'' says David Kahn, an accountant who specializes in retirement at Goldstein, Golub, Kessler in New York. If you don't have enough, keep working and saving. Then there is the issue of health care: Buy long-term-care insurance while it is still affordable--well before you reach 70. That way, you'll be able to enjoy whatever way of living you choose well into old age.
Once you retire, the biggest dilemma is where to live. For many, the urge to cash in the house and move to some exotic locale or finally take that deluxe around-the-world cruise is irresistible. But even aside from financial considerations, that's a huge mistake. A much better plan is to hold on to your house for a few years, even if it seems too big. Instead, rent it out while you try your fantasy life. Then, if you tire of the fantasy, you're not stuck. Chances are you'll be glad to get back home after a few months in that cramped RV. And if you don't need that much house, you still have the option to sell and move. ''The truth is, most retired Americans don't really want to spend the rest of their lives traveling in a motor home--even if many think they do,'' says Dale Preator, a Los Angeles financial planner for American Express who teaches retirement seminars.
One popular option for retirees ready to trade in the old family homestead is a continuing-care community, a sort of all-in-one solution for growing older (BW--Feb. 17, 1997). For a hefty entry fee or endowment--typically $100,000 to $300,000--retirees are guaranteed a range of options from completely independent living right through to the time they require full-time nursing care. That's why dozens of such communities are springing up from California to Connecticut. Evergreen Woods in North Branford, Conn., for instance, boasts 246 apartments and a 50-bed nursing home on an 88-acre complex. The campus includes a bank, beauty salon, library, swimming pool, and gym.
If nonstop travel or a deluxe retirement community is beyond your reach, consider ways to lighten your financial load. One obvious solution is to move into a smaller house. ''You have to look at your principal residence and ask yourself: Do I really need that? If you need more income, it's time to shift your portfolio,'' says Kahn. If you are determined to keep your house, consider a reverse mortgage--borrow against the equity in the house and use the monthly payments to live. The rub: Over the years, you'll deplete your equity, so you may wind up leaving little to your heirs.
Tax planning is another concern. Obviously, those free and clear of a mortgage are in the best position. But if you have a small mortgage, almost all of it is paying for principal, so you are losing tax deductions. It may pay to increase your deductions with a home-equity loan. With the money you save in deductions, you could take a vacation or put a new roof on the house. And if you have savings in Treasury bonds, spend that money as it matures before dipping into taxable pension assets.
The trick, however, is to go beyond financial considerations in mapping out your golden years. Don't think strictly in terms of selling your house for monetary gain. Instead, make sure to focus equally on the all-important issue of what it is you actually want to do and how you want to spend your time. Then ask yourself how much money you'll need to do it. The secret to success, in all cases, is to develop deep interests outside work--years before the boss hands over the gold watch. ''Playing golf sounds wonderful,'' says Jeff Rosenfeld, a New York geriatric specialist. ''But that doesn't last long. Successful retirees have passions outside of work.''
But remember: One person's dream retirement is another's nightmare. Take Eric Daniel, a retired Memorex executive who, with his wife, Arlene, raised a daughter and a son in a five-bedroom house in Woodside, Calif. The Daniels don't enjoy traveling and aren't interested in playing endless rounds of golf and tennis. Trained as a physicist, Eric has always been passionate about painting. So the Daniels sold their aging family house ''when the doorways started looking like parallelograms instead of rectangles.'' Now, the couple lives in a much smaller house five minutes away in Redwood City, where Daniel has converted the sunroom into a 24-foot-by-12-foot studio. The renovation was easily covered by the capital gain pocketed upon selling their old house. And they got a nice tax break to boot: The first $125,000 was tax-free because the Daniels were over 55.
FAMILY MATTERS. Increasingly for many older Americans, where and how you live is dictated as much by complex family situations as by personal interests. And in an age of divorce and increased longevity, multiple marriages seem the rule rather than the exception. That can mean step-grandchildren and countless other relatives to visit. For Terry and Bob Ball, both widowed when they married in 1995, the dilemma of having families and lifelong friends on different sides of the country nearly proved a deal-breaker. So Terry, 66, and Bob, 74, compromised: They live alternate months in Melbourne, Fla., and Malibu, Calif. The Balls are not movie stars with deep pockets. But thanks to savvy investments and smart planning, they are able to swing this pattern with ease--and with frequent-flier miles to spare.
Bob, a retired Lockheed engineer with three sisters, three sons, and various grandchildren, all in California, had been living in an upscale trailer park in Malibu's Paradise Cove, one of the most scenic spots on the California coast. Terry lived in the three-bedroom Jacksonville (Fla.) house she had long shared with her late husband. Terry sold the house, and the Balls bought a condo in Melbourne, Fla., at Indian River Colony Club, a retirement community for former military officers. (Both Bob and Terry's first husband were former officers.)
To save about $5,000 a year in California income taxes, Bob switched his legal residence to Florida. With income of about $7,000 a month, made up of Bob's pension and some stock dividends plus $2,000 from Terry's survivor's benefit package, the couple has no trouble paying the condo fees and the $715 rent for the space in the Malibu trailer park. And with so much travel, they use frequent-flier miles to upgrade to first class and to help pay for European vacations.
For countless others, the best plan of action is simply to stay put. That's what John and Virginia Wolf decided to do after John took early retirement from his job as service manager of a Van Nuys (Calif.) Ford dealership in the late 1970s, at 47. Even though the couple had already paid off the mortgage on their small three-bedroom ranch house and could have leveraged into a bigger or fancier place, all John wanted to do was tinker in the garage and dabble in the stock market.
MOONLIGHTING. Wolf, now 69, has expanded his interests to include car racing and antique auto collecting. Wolf has about $400,000 tied up in his hobby, mostly in a single drag race car he built from scratch. He and a team of technicians and a driver travel the West three or four times a year to enter races. The Wolfs also take a couple of other trips a year in one of their nine antique Fords, as members of an auto touring club.
To indulge in this hobby, Wolf worked a second job at night for 19 years and saved like mad, investing every spare penny in the stock market. For 40 years he has put a little here and a little there into such holdings as Lockheed, Boeing, and Ford. He even swore off life insurance to have more to put into the market. And Wolf has no pension, living strictly off his dividends.
With so many choices, figuring out where to retire is itself turning into a time-consuming job. But whether you want to race cars, go on safari, or stay home to paint, the goal is to end up like Edna Cohen. ''Don't feel bad if I die tomorrow,'' she says. ''I've had a wonderful life.'' Who could ask for more?
By Eric Schine in Los Angeles

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