Retirement is far more than an economic event. It’s a life event. Your identity may be largely redefined as you leave work and transition to a different way to spend your time and money.
Many people who are unsatisfied in retirement have enough money. Where they’ve failed is in redefining who they are and what they do.
Planning your finances to understand how you can afford to live — and how long you can support that lifestyle — is certainly important. But you don’t have to retire just because you reached a certain age or a certain dollar amount of savings. You should retire because your preparation for the next phase of life leaves you eager to apply yourself in your new pursuits.
The reidentification of self can come in many forms. Some people use a pinch of this and a dash of that to cook up a diverse and vibrant retirement lifestyle. Children and grandkids may fill more of your calendar. You may orient yourself to becoming a professional volunteer. The golf course may be calling. Or you may choose to further develop a hobby.
Some people go back to class. This is a great way to keep your mind active, expanding your knowledge or skills. There has never been more access to thought-provoking, or simply entertaining classes. You could take a gourmet chef class or study the classics. Through massive open online courses, many elite colleges offer access to courses covering a wide variety of topics. You can audit them, simply watch the lectures online, or go deeper to participate in research, homework, and even earn credit.
THERE’S NO ONE SIZE FITS ALL
For couples, there is a different set of considerations about retiring. Do you each intend to retire at the same time? Do your individual visions of retirement include the same or very different pastimes? You shouldn’t rely on your spouse to share the same interests — or to want to spend all day every day with you.
Years ago, listening to a colleague talk about his retirement planning, he shared this perspective from his wife: “I married you for better or worse, but not for lunch.” The implication is that you need to get out and find something to occupy your time.
Certainly, there is a lot of travel that can be done (depending on how robust your financial situation is). But even for heavy travelers, there remains a lot of time to fill in your calendar.
Likewise, catching up on the stack of books on your nightstand or the garden project you’ve been trying to find time for, may occupy initial time in retirement but this trend could pass into boredom. It’s important to not only have a list of the next project but also a good understanding of those core things that you value endlessly. It’s these elements of life that will define how “successful” your retirement is.
Exploring what is the best use of your time might lead you to consider not fully retiring. You don’t work only for the income. Your career or occupation defines you more thoroughly than what your paycheck shows. Some people just plain aren’t cut out for retirement. Simply cutting back on work may be in order. More vacation, part-time hours, a slow orderly transition rather than working one day and retiring the next.
These things allow you to take a trial run at retirement. Take a month of vacation. Live as if you were retired and see how it suits you.
Of course, not everyone has this much flexibility to define their work/life balance. And many people don’t get to pick their own retirement date. Job loss, health reasons or other unexpected turnabouts prompt a new reality. It may be most important in this situation to have a plan in place so that you have a sense of what your options are financially and occupationally.
Ideally, if you’ve been diligent about investment savings and you have a plan based on realistic goals about how and where you want to live, you’ll have a satisfying retirement.
In my experience, the evidence of a happy retirement often comes from clients who say, “I’m so busy in ‘retirement,’ I don’t know how I ever had time to work.” These are the people who thought it through well in advance, planned for different stages of retirement — your first 10 years may be vastly different from the next 10 — and have a strong sense of what they value in a full, happy life.
Staying engaged in life and socially connected also keeps people from spending too much time worrying about their finances, perhaps the least interesting topic in their newly defined life.
Gary Brooks is a certified financial planner and the president of Brooks, Hughes & Jones, a registered investment adviser in Old Town Tacoma. Reach him at bhjadvisors.com.