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Overcoming The Tyranny of Retirement, Heaven or Hell? Choose Wisely.

Your retirement account is likely the largest amount of money you've seen in your entire life. The sheer size of $1,000,000 or more in your retirement account can breed false confidence.

On the road nearing retirement there are many decisions. These decisions will have a significant impact on your retirement.

Two Types of Clients

In our experience, our happiest clients are also the most prepared. They spend considerable time before retirement discussing and exploring their “life after career.” They also do not seem to suffer from the “pre-retirement jitters.” They seem relaxed, calm and clear.

Whereas, others show up in our offices saying, “I retired last month, can you help me figure out if I can afford to retire?” These folks definitely feel tension and apprehension about retirement. They think they will be okay, yet they lack clarity and confidence about their future.

We work with both types of clients. Whether you’ve retired or are considering retirement our approach is the same. We begin with getting to know you, your priorities and values. The better we know you the more congruent we can make your financial plan. Retirement is an emotional period of life. There is a lot of money and lifestyle expectations at stake. After all, we all have strong emotions and attachments around money. When it comes to retirement these get magnified.

The Pause That Refreshes

Take time to pause and reflect. To think through what you want to do in retirement. One thing is certain, your life will change following your official retirement.

For example, if you are a couple, age 62, at least one of you will probably spend 20 or even 30 years in retirement. That is a long time to live without earning income. Diligent financial planning is key. Yet, without thinking through how your lifestyle will change, anxiety is the order of the day. Without doing regular reviews, you are gambling with your lifestyle. One thing is certain, change. Think about this, after a lifetime of working and saving it will be time to stop working. Your focus will shift from saving money to spending and managing it.

Your lifestyle is about to change

You will stop going to work. This can be intimidating and troubling. For the first time in decades you will not be gainfully employed. It would quite natural to think, “What the heck do I do now?” So much of our identity is wrapped up in our jobs and career, which makes facing retirement intimidating and overwhelming.

Your lifestyle will change after retirement. No fellow employees to talk and visit with. No work responsibilities. No travel to and from work. No more lunch and coffee breaks with your workmates. It is understandable and normal to feel overwhelmed. Many people grieve over this loss of contact and socializing.

More Than A Money Decision

In restaurants and coffee shops I overhear people talking about retirement. The conversation seems to revolve around two topics. Either about managing their assets or answering the “Now that I’m retired, what do I do?” question.

It’s understandable why people hone in on the “money” strategies and tactics. Except, they forget one important point. When you change your lifestyle, you also change what you do. No matter what. And it all requires money.

Like one person said recently ”I could live on the money I have. I won’t be able to go out and eat in restaurants. I’m worried about making a mistake. Guess I will work a bit longer to make sure I have enough money.” Retirement looks like a week full of Saturdays and Sundays. Which are the days when many have the most flexibility. They are also the days when many people spend the most i.e. groceries, errands and shopping. Weekends are the days of the week when most spend the majority of their disposable income.

In full retirement, the “weekend” is seven days a week. Unless you put some structure into your lifestyle it can be a lonely. It doesn’t have to be that way. Get with your financial planner and explore your retirement lifestyle priorities. An experienced financial planner should be asking you about your lifestyle.

Without taking your retirement lifestyle into account, your financial plan could disappoint. The bigger question is, “What are you going to do in retirement?” You can only sit around and veg out in front of the TV, travel or paint for so long before you get bored. Or until your bucket list is empty.

Your lifestyle choices will have the biggest impact on your quality of life. These choices will impact what you can or cannot do in retirement. Almost everything you decide to do in retirement requires money.

Therefore, there is much more to financial and retirement planning than replacing your income. Lifestyle must be the focal point. Remember, planning your retirement is the largest financial decision of your life. Because, “When you Change your lifestyle, you change your life. When you change your life, you must change your financial plan.”

Giving yourself the gift of time

Allow yourself time to reflect upon what retirement might look like. We specialize in helping our clients explore their priorities and values. We create a safe space to dialogue, explore and test various scenarios. We use the financial planning process to explore your options on paper, rather than with your time and money.

In our experience, this approach brings a sense of clarity and certainty. Not only about your finances, but about your life in general. We look forward to earning the right to do be your trusted financial advisor.

If you have questions or comments about this article, please call us at 1-317-875-0202 or message us with our contact us form.

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