Financial Passages

Nancy, the struggling assistant.Photo: Melanie Dunea

I always dreamed of being a writer in New York. I never dreamed of being a landlord in New York. Still, here we are, my wife and I, doing one so that we can do the other.

Sobered by a 40 percent rent increase, we scrambled to buy a townhouse – three stories of red brick that, in real-estate parlance, needed TLC. To meet the mortgage, we turned the garden apartment into a rental. A year later, if we squint hard enough, the house seems close enough to the dream that we can graft it onto the dream itself. The street looks a little like Sesame Street (with dumpster pickups in the middle of the night). The rooms have stately marble hearths (all sealed, except the one we dropped three grand to open up). When I’m not stripping varnish from the banister, I imagine we’ve sort of made it: a home in the city that’s big enough for, one day, a kid or two.

Never mind that we’re carrying, as my father keeps pointing out, the biggest mortgage in the history of my family (without, I can safely say, the biggest income). Outside of New York, a yuppie-landlording venture like this would be considered lunacy – one of the weird extremes people go to to live here, like sitting in a parking spot for two hours, or lining up at a street-corner cart for breakfast. But our biggest heckler is the future: Since we can just swing the mortgage with a tenant, the tax deduction, and our salaries, what happens if we need day care? We never thought we’d choose private school, but have we priced ourselves out of even the option? And the question that bubbles up at 1 a.m.: If one of us were out of work, could we still keep the dream house?

One night in bed, during what’s become a ritual self-immolation, I heard myself mentioning that if things got really tight, we could just sell the place. It felt awkward hearing it, something like a betrayal. Then my wife laughed. She told me the dream house was the best thing we had going. The mortgage is stable; the asset is growing. It’s the rest of our lives that aren’t quite living up to the dream.

I felt better immediately. Because that feeling, such as it is, is familiar: I know barely anyone in New York, at any earning level, who considers life here to be affordable in the long run. It’s not just that living the New York fantasy means slamming into expensive reality checks: the $12 mixed drink, the toddler ricocheting off the walls of the one-bedroom apartment, the Case of the Vanishing Bonus (followed by the Mystery of the Missing Job). Sometimes your lifestyle demands an upgrade before you can afford it: You fail to take Broadway by storm, then your rent explodes. Other times, you realize you’ve been living like a college kid on a salary that a bridge or tunnel away would get you a mansion. (Okay, a McMansion.)

The fact is, there’s an element of smoke and mirrors – or blind faith – to any New York financial life. The middle class here follows a somewhat predictable series of financial passages – crossroads where our needs and means diverge, and we have to decide what new tactic we’ll embrace to go on living here. Rest easy: Whatever stage you’re in, what you have is never enough – although everything you’d ever want is still here in New York.

Remember the feeling that what you had was all you’d ever have? For two weeks last summer, Nancy, 23, house-sat for an older friend and came away a little shaken. It’s not like the place had Lalique crystal or a lap pool; all it took was a bedroom air-conditioner to start her worrying. “I don’t have a window in my bedroom, much less an air-conditioner,” she says. “The place just felt more grown-up. I like that feeling. I’ve never lived alone, and I hate having roommates. And I can’t think of a time when I won’t have them.”

Nancy, to her credit, has a thrift-store wardrobe and a financial plan worthy of Jane Bryant Quinn. She makes $28,000 in publishing but saves enough to have already paid an extra $1,500 of her student-loan principal. She pays $490 for a four-person share in East Williamsburg (plus $160 a month in loans), has a healthy phobia of credit cards, and never spends more than $25 on dinner. Still, when she adds up those $10 cover charges at clubs like Northsix, and the $20 bar tabs that follow, she spends about $150 a week on eating (and drinking) out. That’s $600 a month – $110 more than her rent. But what can she do? She already brings her lunch to work. A night at the movies is a luxury. “I have one friend who won’t go out to dinner at all,” she says. “My theory is, if I can afford to have kids here, I’d stay. But I don’t know if I’ll ever make that much money.”

20s: Struggling Assistant
23, single, B.A. from a midwestern college
Job: Publishing, $28,000.
Rent: $490 a month for a share in Williamsburg; three roommates.
Debt: $160 a month on student loans, but saved enough to pay an extra $1,500 of the principal this spring.
Credit Cards: Doesn’t touch them.
Expenses: $100 a month, at least, at thrift stores; nights out that cost $600 a month (more than her rent).
Budget bête noire: “I just hate cabs. I feel like I’m just throwing money away.”

Some may say a New York financial life begins when you’re born or show up here. Actually, it starts the second you notice how many people are richer than you.

Tall and blue-eyed and 24, Liza can be found most weekends at Bungalow 8 or Suite 16 or Lotus, in the company of friends from her Ivy alma mater, many of whom have last names that appear on the sides of tall buildings. She also has $20,000 in student loans and $7,000 in “like, mad credit-card debt.” Much as her mom would like to help her, she can’t. Liza paid her freight in a Hamptons share last summer by bartending; now she’s bartending downtown to meet her $1,400 rent in a nearby share. I call and ask her how she does it. She says she pretty much doesn’t. “My landlord gave me a grace period until the 10th of the month, so I have till the 13th for the check to clear,” she says. “I’ve bounced it a couple times, but I just make up some excuse.”

Liza thought her college friends would stay together forever. Then they went out in the city and split the check. “At school, the beers were all $3, so you didn’t notice all the money differences,” she tells me. The $30 cover charges, the $300 champagne that’s sitting at the table when you get there – lately, Liza’s jaw has been dropping from sticker shock. “I literally can’t pay my rent,” she says, “and Rachel’s making, with all her bonuses at Goldman Sachs, over $100,000 a year. There are times when I contribute, but then I have to borrow money for a cab, which kind of sucks.”

She’s snipped up her credit cards and consolidated the debt into one $200 monthly payment. But that leaves little leeway for a pit stop at Bliss. “Nobody judges me, my friends are my friends, but I put pressure on myself,” Liza says. “These girls, you have no idea! They spend thousands of dollars on their appearance, getting their hair blown out every night. I can’t afford that.”

Liza’s learned this town’s great twentysomething secret. “Every single one of my friends has parents who are either paying their rent or helping them out significantly,” she marvels. “That’s the funny thing about New York.”

The city attracts people who don’t want nine-to-five predictability. Even the Wall Streeters are working for the bonus – just like the novelist looking for the big advance. Once the thirties stare us coldly in the eyes, some embrace that predictability in order to stay.

Martine made good use of her twenties – she came out of the closet, went to clubs all night, painted by day, and paid the rent as the manager of a shop in the Village. Well, not so much on that last part. By 27, she had $15,000 in credit-card debt. “The minimums alone were $300,” she says. “I was so broke that I was using my credit cards for new socks.”

Martine had gone to art school but “realized a fine-arts career wasn’t gonna happen.” With a hand-me-down computer, she spent six months forgetting her B.F.A. and teaching herself HTML. The dot-com boom was ending, but she got a $30,000 systems job at a huge company. In return, she made some changes. “I had to take my nose ring out,” she says. “I was really upset about that. If you didn’t wear a suit one day, someone would say, ‘Oh, you’re being casual this week.’ I wore stockings even in the summer, and I had to accessorize. It felt like a game.”

Albeit a game with easy rules. “I liked that if you wanted to get something done, there was a process by which you could do it,” she says. “I also was astonished at how incompetent a lot of people were. I think I was so eager to please that I did more than they were expecting.” What held her back for so long? “Not working a traditional nine-to-five – I was hung up on that almost for no reason.”

A few jobs later, Martine is making $60,000 and living with a partner who has a summer place in New Jersey. Her credit-card balances are holding at $10,000, plus $5,000 in college loans. But her expenses are only growing. The rent is $2,000 and climbing. They’re thinking of having a baby. With each insemination costing $700 or more, getting pregnant could cost them thousands of dollars. “Even just reading a donor profile is $10,” she says, “and when you look at twenty donors, it gets expensive.”

And so Martine can’t help but wonder: Did she make such good use of her twenties after all? “I look back,” she says, “and think that I’m living with the tangible result of having stuck it out in New York, when maybe I might have been better off if I hadn’t.”

Laurie and Charlie, fast-track refugees.Photo: Melanie Dunea

The rush of a New York life is the sense that next year, you could be rich: The market bounces up and down, and so do our expectations. The nadir of the market, of course, is murder. The story of our financial lives now is, often, the story of downgrading from Le Bernardin to Balthazar, or Balthazar to the Bendix Diner.

Alex, a 27-year-old portfolio manager at a top firm, and his wife, Amy, a medical resident, make about $175,000 between them – she makes $40,000; he makes $90,000 plus a 50 percent bonus. But this year, there will probably be no bonus at all. And there’s more bad news: His 401(k) once had $80,000; now it’s more like $40,000. “I put 100 percent of it into my company stock,” he says grimly. And Alex is entering business school part-time soon, which will cost him more than $20,000 each year, even after his employer’s contribution. (“Don’t get me started on that,” he says.) A week at the beach can run them $5,000 including airfare. They do have one sweet asset: a one-bedroom in the Village Alex bought five years ago for $200,000 cash (most of his savings). But Wall Street’s slump will keep them there a while. “The things we were hoping to get, like a bigger place, got put on hold a few years,” he says. So will starting a family.

Some people gauge their financial stage by how much money they take out at the ATM: It starts at $20 in your twenties and creeps its way up. In your thirties, when your futon finally reveals to you its true nature – an uncomfortable couch that unfolds into an uncomfortable bed – your prolonged urban adolescence is over, and a whole new category of expenses unfolds.

“Lynn wants a super-duper design-type coffee table now,” complains Darin. “She showed me this one on a Website that’s like $3,000. So we’ll have a friend make it for about $1,000.” Then there’s the moldy rug Lynn’s had since college, and the pressboard bookshelf they bought when they moved here eight years ago. “We haven’t put anything into our apartments,” he says. “And you know, if a woman is unhappy with her apartment, it definitely adversely affects your sex life.”

He’s a 30-year-old insurance-company executive; she’s a foreign-exchange trader; kids aren’t (yet) in the picture. The two of them now pull down about $250,000 and pay $2,500 a month rent on a one-bedroom in the West Village. Sometimes he feels much richer than people his age who don’t live in New York – which puts a damper on the annual ski trip with Darin’s old friends. “It’s really hard having those conversations with my guy friends, because they’d suddenly look at my wife like she’s Yoko.”

These friends aren’t New Yorkers. They don’t have Darin and Lynn’s earning power. “But there are trade-offs,” Darin points out. “Those friends own a house now, and we don’t.”

30s: Fast-Track Refugees
Laurie and Charlie
33 and 32, married with a 3-year-old son
Jobs: Lawyers, $200,000 combined salary, left corporate jobs to spend time with their child.
Mortgage: $1,900 a month for a two-bedroom in Soho.
Child Care: $18,000 a year for a nanny; $500 a month for part-time preschool.
Savings: None – Charlie’s 401(k) vaporized in the market.
Debt: $110,000, student loans and credit card.
Budget Crisis: “Sending him to private pre-K is one thing. The real issue is what we do in the coming years. Can we justify living here on our salaries?”

Buddy, the Ivy league unemployed.Photo: Melanie Dunea

New York’s perks come with a price – and when that price becomes less bearable, some call it a career crisis. Buddy graduated from an Ivy League law school in 1994 fairly confident that he’d never want for much. His associate job at White & Case vaulted him above the six-figure mark, but he had a hard time seeing past the twenty-hour work days and endless hazing process. “I became so testy and so aggravated,” he says. “There’s a line the other night from the Sopranos that made me think about it: ‘The money flows up, and the shit flows down.’ “

After taking six years to pay off most of his $100,000 in loans, he quit to try entertainment law, and his salary dropped as low as the sixties. Then, last winter, Buddy was one of the hundreds laid off by Cablevision. He’s used last year’s tax refund to pay his living expenses while his unemployment check covered his $1,620 rent. Now his unemployment is running out, and he’s bracing himself for a huge tax liability next year on his unemployment checks. Luckily, his loans are paid off and he has no credit-card debt, but he’s 33 with $6,500 in retirement savings. The jobs he’s scrambling for now pay 10 to 15 percent less than what he started with eight years ago. So he’s looking at corporate work again.

But something’s changed. At the height of his corporate-law days, he’d drop between $90 and $150 a night at karaoke bars, thinking nothing of buying drinks for good-looking women. Today, he says, “my cooking’s gotten better. I like to entertain at home now. But it’s very hard to do that on a first date, so I’m meeting fewer women.” Sometimes, he feels taken advantage of. “There may be an impression that even a lawyer who’s been unemployed most of the year still has a lot of money. I had someone over. We ordered in. Then when it came time to pay, she didn’t make a move! It cost me $30 for her to visit me.”

Here’s a couple who did everything right and are still feeling the pinch: Laurie and Charlie, both lawyers, bought a one-bedroom in Soho for $180,000 five years ago, before the market peaked, had a baby, and then bought the adjacent studio for $130,000, knocking down the wall. Their 1,250-square-foot place could now sell for $750,000. “We were in this fantasy world where we’d refinance and buy a place on Fire Island,” says Laurie. “But that was just a dream.”

Each month, they pay a $1,900 mortgage, $1,000 maintenance, and $800 toward $110,000 in student loans and credit-card debt. They found a deal on a $340-a-week nanny – “unbelievable, on the books and everything” – but then came preschool. “We had enrolled him in a $7,000-a-semester private school,” Laurie remembers, “and I went there and all the kids were running around in Tod’s shoes. Those cost almost $200. That’s just not a reality for him. I wondered if we’d come to feel, totally unjustifiably, that we weren’t giving him everything we should be.” They chose a part-time cooperative pre-K instead, costing $500 a month.

Their income has also taken a hit, by their own design: Because of the baby, they quit their corporate-law jobs and got in-house-counsel jobs with better hours. Now in their early thirties, they make about $200,000 between them. Which means they haven’t furnished the place the way they’d planned. “Other people throw parties at FAO Schwarz,” says Laurie. “We’re having his for the third year in a row at a sandbox in Washington Square Park.”

What astounds Laurie the most is her Catch-22: Staying here gives you access to jobs she and Charlie would never have … but with expenses the jobs can barely cover. “I travel to Shanghai, Bucharest, London, L.A.,” she says. “Charlie’s doing all this investment in the former Soviet republics. We both know that we wouldn’t be doing this if we were anywhere else. But if Charlie had stuck it out at his firm now, he’d be up for partner, making $750,000-plus. That would have been interesting.”

30s: Ivy League Unemployed
33, single, Ivy law degree
Job: Laid off in January; unemployment runs out in November.
Rent: $1,620 a month for an Upper West Side studio; stays chummy with the landlady to stave off a rent increase.
Savings: Market socked his retirement accounts; down to just $6,500.
Budget Hangover: When he had a job, he’d drop $90 to $150 a night at bars.
Today? “My cooking’s gotten better. But it’s hard to convince someone to come home on a first date.”

Barton, the aging renter.Photo: Melanie Dunea

When kids come along, so does the classic upper-middle-class New York dilemma: Do you pay for a bigger place or private school? Meg, 32, is a corporate lawyer in the middle of her second pregnancy, getting reacquainted with her midwife at the same time that she’s shopping for nursery schools for her 2-year-old. Oh, and she’s also working – part-time at a top white-shoe firm, on a 65 percent schedule that’s really turning out to be about 95 percent. “Today is the first day I decided to work at home and have Annie’s nanny come,” she tells me when I call. How much work did she get done? “Um, I found my cell phone, and I found my keys, which had been missing for ten days. I went through the last two weeks’ mail. Look, it’s not like I even said, ‘Okay, today I’ll decide if I’m putting money into Annie’s state college fund or her Roth IRA,’ because I feel like I don’t even have the time or space to breathe.”

She and her husband, Mark, expect to make at least $300,000 this year. Their $2,475-a-month Upper East Side one-bedroom is getting a lot of use: Mark, 38, left a health-care-administration job to start his own business and is working at home while their $20,000-a-year nanny looks after their daughter in the living room. “We know we’re gonna have to move,” Meg says. “But having a baby in New York is excellent. I rarely have to put Annie into her car seat. I love that she plays with so many different kids on the playground. I love that she knows how to use the MetroCard on the bus. It’s so cool! When she gets tired, she looks at me and says, ‘Take a taxicab?’ ” Does she worry about paying for that? “It makes my life so much easier,” she says. “Then I worry it’s short-term of me – that if I’d stayed at home and cooked instead of ordering out, I would be able to buy a better apartment.”

There’s a solution, of course. “If I went back full-time, it would be easy,” Meg says. “But I have no interest in heading back full-time. Though as Mark likes to point out, I am back full-time.”

As the rest of us grow older, Phil’s apartment has kept him young. In cheerful defiance of the rent laws, his $1,100 Murray Hill two-bedroom has been handed around his circle of friends for years. It’s in such gloriously terrible neglect that most of his friends love dropping by to use it as a big ashtray. He’s gay, and his roommate is straight; they’re living an updated version of The Odd Couple, only both of them are Oscar.

In 1995, the year he won the middle-class-housing lottery, Phil was making $33,000 in health-care PR. By 2000, he was making $125,000. When he was laid off in 2001, Phil was thrilled to discover his unemployment was covering his rent – so thrilled that he dropped $3,500 on a summer rental on Fire Island and piled on $4,000 in credit-card debt. Now he has no savings. His new job pays $80,000, but he has to pay his own health benefits. “You do feel sometimes that you have to apologize to your landlord just for living there,” he says. “But then in ‘97, I was completely freaking out when Joe Bruno was threatening to blow away the rent laws. I have friends who are renting for about $3,500 a month.”

Boyfriends and jobs come and go, but the apartment is forever. “Part of me wants to move to Seattle,” he says. “But part of me wants to hang on to it for my niece for when she graduates college.”

When will that be?

“In eight years,” he says.

30s: Aging Renter
39, married, two kids
Job: Screenwriter, $750,000 a year.
Rent: $9,000 a month for an Upper East Side three-bedroom.
Savings: He lost almost $500,000 in the market but has $1 million left. “That’s awesome, but you know what? That’s like a year and a half for me to live.”
Expenses: Garage for car, $400; private school, $20,000 for the 7-year-old, $7,000 for the 2-year-old (two days a week); nanny-housekeeper, $40,000. “We can’t believe I make that much dough and everything costs so much money.”
Will he buy a place? “Anytime we see an apartment nicer than our rental, it costs more than $2 million. And I just won’t put myself in that position.”

New Yorkers, unlike people from everywhere else, seemingly have no problem paying rent forever. But for most of us, renter culture is an outmoded Annie Hall–era stereotype – an urban legend born during a rent-control era that’s now mostly over. In its place is a harsh reality: The longer we stay here, the harder it becomes to get out from under our rent.

Wendy, a 41-year-old financial consultant, and Howard, 52, a PR maven, make $400,000 between them – “although we’re not rich or anything,” Wendy says. “Isn’t that a crass thing to say?” She doesn’t know where her money goes. “Our lives are about eating out, rent, theater, and getting out of New York on the weekends. We don’t own a car. We don’t have kids. I don’t spend a lot on clothes – I wear black, I’ve worn black, and I’ll continue to wear black. Neither of us has a coke problem.”

The culprit is rent: $5,500 a month for their midtown two-bedroom. Even in this market, negotiating it down takes nerves of steel. “My landlord is just a jerk, and you can print that,” Wendy says. “They know what a pain in the ass it is to move in New York, and they don’t talk to you until a few days are left in your lease and they assume you just won’t leave. We definitely won’t pay an increase. We’re gonna have to be ready to move.”

Even if they had more money, they’d feel the same pressure. Barton, 39, is a screenwriter who lives with his wife, Emily, and two kids in a three-bedroom on the Upper East Side that runs them $9,000 a month. In a good year, when he gets a surprise one-week script-doctoring job on a big studio film for $150,000, he can make $750,000. Barton lost almost a third of his savings in the market, but he still has $1 million. A down payment on even a $1.6 million place would cut that stake in half. And then who knows what the market will do – or if he’ll get any more movies made? “I have, like, a million bucks, and that’s awesome!” he says. “But you know what? That’s like a year and a half for me to live.” That includes rent, plus $400 a month to garage his car, plus private school – $20,000 for the 7-year-old, $7,000 for the 2-year-old (two days a week) – and the $40,000 nanny-housekeeper (“She’s great with the kids”), and soccer league and the piano and basketball lessons (“Okay, the piano is our thing, but the rest he wants”).

“Almost every day, my wife and I talk about this,” Barton says. “We talk about leaving the city, but I can take my kids to the park and the Met, both before lunch.”

New York is the land of no no-fault divorce, making breaking up harder to do here than practically anywhere else. Real-estate values muddle things even more. When Veronica, a 45-year-old in corporate philanthropy, divorced her M.D. husband after ten years, she fought for custody not of kids (they’re childless) but of their two-bedroom Park Avenue apartment with Central Park views. She lost. Looking back, she thinks the death knell sounded when the court ruled that he didn’t have to help with her legal fees. “He could always outspend me,” she says. “And he said, ‘I’ll spend whatever it takes to get that apartment away from you.’” She’d already spent $30,000 in legal fees. “To go to trial meant another $50,000.”

Desperate to upgrade her salary, Veronica left her job at a nonprofit and entered the corporate world, jumping from $100,000 to $150,000. She got a monthly payment of $2,800 from her ex for two years, most of which went to pay her legal bills. But thanks to high Manhattan rents, she still hasn’t saved a dime since the divorce. Her savings linger at less than $1 million. She’s found a rental in midtown for about $1,000 more than the $2,400 mortgage and maintenance on the Park Avenue apartment. “I don’t have a dining room now,” she says. “Meanwhile, he hired an expensive decorator to redo the apartment. I’m so much poorer, and he’s so much richer.”

Like Liza splitting the check with her friends at Bungalow 8, Veronica senses a gulf emerging between herself and other women her age. “My circle of peers are much, much wealthier than I am,” she says. “You depend on your friends to support your causes. And so now it’s recognized among my friends that they can’t depend on me to do that.” Happily, she’s quick to add, “They still like me.”

40s: Downwardly Mobile Divorcée
45, divorced, no kids
Job: Corporate philanthropy adviser, $150,000 a year.
Divorce: Cost her $30,000 in legal fees – and the $800,000 Park Avenue Pays $3,400 for a midtown one-bedroom. Most of her things are still in storage.
What she misses: Can’t attend her friends’ benefits anymore. “I’m so much poorer than I was four years ago. And my ex-husband is so much richer.”

Remember that windfall you dreamed about in your twenties? In your late forties, there may come another What Am I Doing Here? moment, during which some find themselves looking elsewhere to make ends meet – like their parents’ bank accounts.

Last year, Jake and Sarah, each approaching 50, told their teenage daughter that they’d be able to pay for high school or college but not both. “She gave us a look,” Jake says, “and said, ‘You guys have to be better planners than that!’ ” Jake is a publishing executive; Sarah teaches at a local college. Together they make nearly $200,000. They have $20,000 in credit-card debt and a $500,000 mortgage – and $25,000 in the bank and $200,000 in retirement savings. Their daughter is a sophomore at a pricey downtown-Brooklyn private school and already thinking about going after scholarships.

Sarah’s father is approaching 100. His retirement kitty took a hit in the market, and now he and Sarah’s mother are drawing on principal – “spending more money to cover the rest of their lives.” Which, of course, means less money for Jake and Sarah. “That really sounds predatory, perhaps, but it’s just a fact,” Jake says. “We’re the first ones to say the right thing, but meanwhile that inheritance is going down.”

You’ve read about the sandwich generation – boomers supporting aging parents and unemployed adult children. In New York, adult kids stay close to their parents for real-estate reasons. David, 52, a doctor in Brooklyn with a $300,000 salary and a paid-for townhouse that could sell for $1.5 million, harbored fantasies of buying a Manhattan pied-à-terre and slowing down a little. Then, last spring, David’s younger son came home from his second year of college announcing he wasn’t going back. He wanted to be a jazz musician. “He’s very good, but there are a lot of guitarists out there,” David says. “Basically, our plan is we’ll pay his room and board, which is what we were doing when he was in college. But we told him that being in school was his job, and if he quit that job, he’d have to get another job.” Of course, he’s quick to add, “if he finished college and wanted to go to grad school, we’d probably pay for that. We’re willing to support him as long he’s moving forward.”

For the well-heeled, supporting kids isn’t the issue; ditching responsibility is. Peter, a 55-year-old lawyer making $2 million a year, has his own practice, a second wife, two sons in private school, a four-bedroom on the Upper East Side worth seven figures, and a fourteen-room beach house on the South Shore of the Hamptons worth at least $10 million. He bought the apartment and built the house in the same year, the year his father died. “It wasn’t a conservative moment,” he says. “I was having a reaction.”

Lately, with his first son looking at colleges, he’s become aware of time slipping away. “There are days when things are so tough – not that I’m losing money or anything, but you know, you can’t get something done because there are people standing in your way. At those times, you go, ‘Oh, God, Tuscany, here I come.’ “

Youth culture may rule New York in most respects, but older people here have one thing that kids crave: a place to crash. Milton, 67, is an NYU professor who lives with his wife in a $3,000-a-month apartment in the Village. He makes about $100,000. Five years ago, his 27-year-old son, Clyde, announced he was moving back in with them for film school. “I love my folks!” Clyde says. “They’re cool. And they’re interesting, smart, fun, caring people. I learned that by spending time with them.”

Clyde, now 33 with a pregnant girlfriend, doesn’t see anything wrong with someone else’s paying rent – it’s a New York thing. “I have five friends who have lived with their parents at one time or another,” he says. “One guy, his parents had a brownstone in Fort Greene. They lived upstairs, and he lived downstairs. Now his family needs money, so he moved back upstairs with them, and they rent out the lower floor. They became a family unit again.”

Clyde’s father takes it all in stride: “That’s what life is all about. It’s awful to have the idea that at 18, they’ll go away. The energy that I get from him is extraordinary, and I believe he gets this energy, too.” Given his extended family, Milton doesn’t see himself retiring until he’s 80.

50s: The Unretired
52, married, two adult sons
income: $300,000, doctor in private practice.
Homes: Park Slope townhouse, upstate seven-acre farm – both fully paid for.
Expenses: $16,000 in malpractice insurance; $300 to garage car; support for 20-year-old son who quit college.
Debt: None.
Savings: $1.2 million ($1.6 million pre–bear market)
Retirement? Not as long as his son is living at home. He quit college to become a jazz musician. “We were empty-nesters, and now we’re not.” If this goes on, “I’d think about charging him rent.”
Possible windfall: Park Slope townhouse could sell for $1.5 million. In 1982, he paid less than $200,000.

For others, of course, retirement not only is thrust upon them but becomes a second job. Rose, 64, was downsized out of her $50,000 job in the home-design industry two years ago – bidden farewell with a friendly handshake and three months’ severance. She took a look at all her assets – it didn’t take long – and saw they added up to about $250,000, including a 401(k), annuities, and some savings bonds. Since then, she’s been spending about $22,000 a year to live, first using the interest on the savings bonds and her Social Security. She’s in fine health but lives alone in a stabilized $500 apartment in Queens. “In my building, they’re going for $1,300 or $1,400,” she says. Besides her rent, her biggest expense is $350 a month for health insurance.

Until she’s 65, she won’t qualify for Medicare, but even that won’t cover everything. “I keep asking people over 65 about it,” she says. “Medicare doesn’t cover a lot of other expenses, so you need a supplementary medical policy.” One policy she looked at costs $426 every three months; another costs $200 every two months. No two are alike. “I need a lawyer to get through a lot of this stuff,” she says. “Of course, when they come to me, they always seem to raise their price.”

Other big expenses? Nice shoes run her about $70. “I’m not a Payless person,” she says with a laugh. “I think my budget’s still above that. I go to a Mets game maybe four times a season. The tickets nowadays, that’s part of your life savings. And then I travel because both my children are out of state. I go to see my three grandchildren about three times a year.”

Leaving New York isn’t an option for her, not as long as her health keeps up. When she’s not watching the Knicks on TV (“A ticket at the Garden for $175? No way!”), Rose spends her time watching her money. Given the economy, she can’t afford not to. Next year, her rent’s increasing to $528; that’s one less dinner out. But she’s on top of it: When her 401(k) started hemorrhaging, she rolled it into an IRA.

“Who knows how long it’ll last?” Rose says. “But I don’t get upset about it, you know? My parents lived through a depression.”

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The names in this article have been changed. The photos are of models.

Financial Passages