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Deciding When and Why to Retire: it’s Emotional, not just Financial

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Retirement planning is our professional focus here at AgingOptions, and that means we read a great number of articles and studies that flood the internet every week. Since the baby boomer generation has begun to retire, the sheer volume of information about retirement planning has exploded. In fact, out of curiosity, we just tried entering the words “retirement planning” into our Internet search engine and immediately came up with almost 2.5 million hits!

It does seem to us that the majority of articles about retirement focus chiefly on finances. When will you know that you have enough money to retire? How can you maximize Social Security? How much income will you need ten or twenty years from now? How should you handle Required Minimum Distribution from your 401(k)? These are all important questions, it’s true, but as we’ve said here a thousand times, money alone is not a guarantee of retirement bliss – in fact, the opposite can often be true.

For that reason we were drawn to a recent pair of articles that seemed to us to raise important questions about retirement, questions that have little to do with money. One deals with the question of when – when do you know that it’s time to retire? The other deals with the question of why – why retire in the first place? What’s the point? Let’s take a look at these and see what light they shed on the non-financial considerations surrounding retirement.

The first article is this one from the Kiplinger financial website.  “How do you know when it’s time to retire?” asks author Janet Bodnar. “The decision to retire is a personal one that’s as much psychological as financial.”  The article describes some conversations the recently-retired author had with a group of her high school classmates celebrating their 50th reunion. One classmate had retired from her job as a school psychologist, while another who had been laid off from a corporate h.r. position had started a new part-time career as an executive consultant.  The third was hoping to ease into retirement by staying on the job while cutting back on her administrative responsibilities.  In other words, these women were representative of many boomers facing the decision of when to retire.

“Retirement is really a lifestyle change triggered by some event,” says Brian Sykes, a financial planner quoted by Bodnar in Kiplinger. Those “triggers” can vary from individual to individual: a layoff, a health crisis, or the demands of family. “Many people simply want to be closer to relatives or spend more time with grandchildren,” Bodnar writes. Some grow restless in their careers, facing “the desire to do something different, make more of an impact or just have more flexibility.”  For some, the desire to retire is spurred on by a reminder of mortality, such as the death of a close friend or family member. “People realize that time is their one fixed resource, and how they spend it becomes more important as time shrinks,” says Sykes. “People make decisions emotionally and then use the numbers to justify those decisions.”

Baby boomers, says Bodnar, “are the first generation to face the challenge of how to plan for a retirement lasting 25 to 30 years.”  That makes the why of retirement just about as important as the when. And that in turn brings us to the second article, this one from USNews called simply “What’s the Point of Retirement?”  Unlike in the past, when retirement represented little more than “a brief period of well-deserved rest after a lifetime of backbreaking work,” the outlook for today’s retirees is completely different.  “Today’s retirement offers a chance for a whole new life,” the USNews article says, “to reinvent yourself for your next couple of decades.”  So how can you find the why in your new life as a retiree? The article lists six suggestions to help you discover the point in retirement:

  • Enjoy your freedom. As you escape the pressures of work, “you can begin to relax and enjoy the feeling of not being exhausted all the time. You will probably find your anxiety slowly slipping away and may start to sleep better. Without so much stress in your life, you might find that your health and energy levels start to improve.”
  • Rediscover yourself. Once the “vacation stage” of retirement begins to pass, it’s time to “think about what you really want to do – rather than what you’ve always felt obligated to do.” Go back to school, start a business, volunteer, travel – dive into some of the things you’ve always dreamed of doing.
  • Make some plans. “Some dreams expand,” says the article, “while others become more realistic. Maybe instead of walking the entire Appalachian Trail, you walk a section of it, or instead of going back to school to earn a law degree, you attend classes at a community college.” By getting started with realistic plans you may find yourself discovering a niche for yourself that you never knew existed before.
  • Develop new routines. “You may miss that [former work] routine at first. So develop a new one.” Begin to rebuild your week around an exercise class, a part-time job, a regular volunteer position or involvement in a church. “These routines,” says the article, “provide structure for retirees who might otherwise feel as though they are drifting along with no purpose.”
  • Make new friends. “You might begin to miss seeing your old work colleagues every day,” says USNews. “Loneliness can creep up on you as you lose old friends, and it’s sometimes hard to make new ones.” So don’t be afraid to reach out at your volunteer job, your college classes, or the local senior center in town. Another great idea is to get a pet: not only will a pet bring companionship, but “you’re likely to meet like-minded friends down at the dog park.”
  • Recalculate. Here’s how the article puts it: “No matter how much you plan ahead, you may find that you’ve made a false start. Some people have trouble adjusting to retirement, and end up taking on a new job for another year or two before they are truly ready for retirement. Or you might move into a retirement community, seduced by its pretty landscaping and built-in activities, only to realize the place isn’t your style. So try things out, and then reassess your needs. You might not find your ideal retirement lifestyle on the first try.”

If these articles provide answers to when and why to retire, let AgingOptions help you understand how to retire. How can you protect your assets and avoid becoming a burden to your loved ones? How can you make certain your finances, legal affairs, housing choices, medical protection and family communications are all woven into a blueprint for your retirement future? An AgingOptions LifePlan is the answer. We invite you to bring all your retirement questions and join Rajiv Nagaich at a free LifePlanning Seminar near you. It could be the most important few hours of your retirement life! For details and online registration, click here – then select the seminar of your choice and register online.

Getting ready to retire? We’re ready to help guide you. Age on!

Need assistance planning for your successful retirement? Give us a call! 1.877.762.4464

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