Retirement for many is a long-awaited, much anticipated event; however, researcher and author, Alan Spector, in his webinar for the MonetaU Speaker Series this week, said that many also have anxiety about it.
While the word “retirement” may connote an ending, he said it’s important to think about it as a new beginning – a time when you can do what you want, when you want, with whom you want. With all of this promise of freedom, Spector warned it’s a mistake to just “let it happen.”
He stressed that it’s best to approach as a process. His research has found that more than half of retirees do not enjoy their first year, many find themselves disenchanted and struggle with depression.
He warned that retirement is not a passive event. If you just stop working and sit back thinking everything is now going to be magically fabulous, think again.
Spector said, “A holistic, written life plan greatly increases the odds of living the future you deserve and makes for an even more meaningful financial plan.” His approach includes not only planning and preparing, but also practicing retirement and considering deeply the time and place for it.
Plan Beyond the Finances
Spector advised to not let the entire focus of your retirement planning be on just finances. While having the funds for your retirement is absolutely necessary, it’s not everything. His research has found that the greatest issue for many isn’t running out of money but running out of “meaning.”
To address this, ensure your plan identifies both your life purpose and core values. Many of us confuse our role as our purpose, but our activities beyond our working years should be aligned with our purpose.
Like a smart financial plan, a personal retirement plan is diversified with contingencies for things like a pandemic, health issues or a family change, and is revisited over time to make necessary adjustments. It should also be approached with an expanded vision about what’s possible. We shouldn’t limit ourselves to what we think a retired person is “supposed” to do.
Three key aspects you may not have realized to include in your plan:
- Retirement is a “team sport,” not something you can do completely on your own. Your retiring will affect many people who are close to you. Crucial conversations that are clear and direct need to happen at this stage with those in your closest circles to have a realistic plan that can work. If you have a significant other, you will each want a plan for yourself as well as one that you can do together.
- Plan on allocating bandwidth to giving back in a way that energizes you. Despite the significant rewards of volunteering, Spector cited that 75% of Baby Boomers say they will volunteer in retirement, but only 25% actually do. Have a specific plan to make it happen. Consider what you’re passionate about, what the world needs and where your talents lie. At the crux of those can be a very rewarding new role for you.
- Connectedness has a significant impact on longevity and quality of life. Put the time and effort in to nurture authentic friends in your life that provide a sense of security, people you could call at 2 a.m. if you needed something without qualms. Ensure you have at least seven of these people in your life.
Practice Long Before Actual Retirement
Thinking you can wait until you’re in retirement to figure out your plan can set you up for disappointment early on. Spector recommended that we practice retirement while still working. For example, just because living in a southern state during the winter seems like your dream, make sure it’s as “dreamy” as you’re envisioning. Go now. Spend time down there for a vacation, testing out several locations. If you do this ahead of time, you can better frame in not only how you will truly enjoy spending your time, but also how that impacts the funds necessary to support that lifestyle and ultimately when you can afford to retire.
Each person should ask themselves four questions to determine the best timing for them:
- Do I have a written holistic retirement life plan? Or, will I have enough to do?
- Do I have enough financial resources?
- Do I still enjoy working?
- Do others want me around 24 x 7?
Retirement in Action
A positive attitude is especially important in retirement and adds seven years to longevity and an increased quality of life. Plot out what an ideal day looks like, specifically, defining timeframes and location. Know that every day of retirement will not be “an ideal day,” but use this as your guide to determine what you want to start and stop doing to shape your plan about how you would like it to be.
Spector notes that it’s never too early to create your personal retirement plan. In fact, over a third of the webinar’s attendees were five or more years away from retiring.
Alan Spector is a co-author with Keith Lawrence on the book, “Your Retirement Quest: 10 Secrets for Creating and Living a Fulfilling Retirement,” based upon a decade of research and interviews with more than 200 retirees.
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