I just read a great article in The Wall Street Journal on planning for retirement and it being way more than just saving into your 401(k). Building adequate savings is obviously the most important item yet once you hit that, what else do you need to consider. It is more than just saving money. It’s a total mind shift and behavioral change.
Research says it takes about two years to settle into retirement. Two years! I would guess most people spend more time planning a long vacation than planning for a successful retirement. And when I mean successful, I mean one that is both fulfilling and satisfying.
Experiment that first year
Your career likely provided a sense of purpose, structure, and a comforting routine. The structure and routine are out the door on day one. And that’s ok. You don’t need a fully drawn out plan that first week. You should consider that first year a type of gap year where you experiment with different things. Use the time to explore new (or long forgotten) interests, take courses at a local college, talk to nonprofits about volunteer opportunities, reconnect with friends, or fulfill that travel bug and take that long-awaited vacation. After all, you will likely be the healthiest in the early years of retirement, so take advantage of the good health and extra energy.
Many people considering retirement ease into it by working part-time the last 6-12 months to help their team transition. This could be a great way to start this next stage. However, be sure to set clear boundaries. If you only agreed to work two days a week, then only work two days a week. Working more will be frustrating as it delays your retirement. The same will hold true for your family. Maybe a child wants you to care for a grandchild or two more than you are anticipating. Or maybe your spouse or children are not ready for you to be around the house more. Ask them. You may be surprised by their answers. Remember, do not let other people’s needs override your own.
Many studies show that the earlier one retires, the higher the chance for an early death. Do not let the extra time and freedom in retirement, replace routine, identity, purpose, and mental stimulus. Create a plan for how you’d like to spend your days. Write down what an ideal schedule looks like for you and your spouse. Write it down for each morning, afternoon, and evening for each day of the week. See a lot of holes – this is not necessarily a good thing. Without a plan, some people just end up watching TV all day or resort to heavy drinking. Some think they can play golf all day, every day, yet end up bored with it.
If you are a reader, one of my favorite books I recommend to clients that want to prepare for this next stage is called The New Retirementality by Mitch Anthony. Or schedule a call to talk with me. I enjoy having these conversations with clients that are more than just dollars and cents. I want you to consider doing something where you would have no regrets on how you spent your time.To learn more about how we work with clients, check out our process here: https://perkinswa.com/working-with-us.