Why should you test your retirement
Most retirement planning tips focus on saving enough money to replace your paycheck.
But work gives us more than income. Many of us derive meaning, fulfillment, and even identity from what we do. Work also provides social connections and structure for our days.
Losing all of that can be disorienting, which is why experts – including some who have already retired – recommend thinking about how you will replace these aspects of the job.
“Most adults don’t want a life of pure leisure,” writes certified financial planner Barbara O’Neill in her book “Flipping a Switch: Your Guide to Happiness and Financial Security in Later Life.” “They crave purpose, meaningful daily activities and relationships, and the freedom to do whatever they want, even if it means keeping on working.”
Imagine a typical day
Retirement often begins with a wave of activities as people travel, visit family and indulge in their favorite hobbies. But retirement experts recommend considering a more typical day after you’ve checked off some of your bucket list activities. How are you going to spend each hour, from the moment you wake up? Who will you spend time with? How will you react when someone asks you “What are you doing?” “
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O’Neill, for example, does not use the word “retired” to describe herself. Instead, she explains that she left Rutgers University after 41 years as a professor and now owns Money Talk Financial Planning Seminars and Publications, where she writes and talks about personal finance topics. .
In fact, research shows that working in retirement is associated with greater happiness. Part-time work can also help you gradually retire, says PSC Shelly-Ann Eweka, senior director of financial planning strategy at financial firm TIAA.
“Some people are really stressed because it seems final,” Eweka says of retirement. “Consider working part-time to have fewer jobs and more free time to make yourself comfortable there. “
Retire for a test drive
You might want to test drive your retirement vision before you leave work, Eweka says. Consider spending a two week vacation doing what you hope to do in retirement, like golfing, traveling, volunteering, or looking after your grandchildren. If you are planning to move to another area, you can rent a house there for a few weeks, if possible. You may find that reality meets or exceeds your expectations. Otherwise, you can change your plans before committing, says Eweka.
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Also think about how you will replace the social interactions you get at work. People with strong social connections tend to be happier, healthier, and live longer. You can invest in existing relationships before and after retirement by spending more time with family and friends. O’Neill recommends setting designated days and times for connecting regularly, either in person, or by phone or video call.
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But getting older also means you’ll lose connections as people die or move away. Volunteering, joining community organizations, or just getting to know your neighbors better can help you build relationships with new people, says O’Neill. The company of a dog, cat or other pet can also contribute to well-being.
Without a structure imposed by work, some people start to drift, one day falling into the next. Setting goals and taking action to achieve them can help regain a sense of purpose and achievement, says O’Neill.
O’Neill began her life after Rutgers with five goals: to finish the book she was writing; stay active in financial education; cultivate friendships; “Do a lot of fun things and new things”; and stay healthy by taking 10,000 steps a day, eating healthy foods, and getting at least 7 hours of sleep a night. (Taking care of your physical well-being is key: 81% of retirees in a 2014 Merrill Lynch study cited good health as a key ingredient for a happy retirement.)
Achieving specific, measurable goals can help people redefine their concept of productivity, which is important for many people’s self-esteem, O’Neill says. Goals can also help offset a tendency to procrastinate.
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People accustomed to saving and delaying gratification may find it difficult to “flip the switch” to move on and enjoy their lives, O’Neill says. But time, good health and energy are not endless. Many in her community of 55 and over in Ocala, Florida struggled during the pandemic not only because their plans were canceled, but because of a keen awareness that the clock was ticking, she said.
“It wasn’t just two wasted years, it was two good years,” says O’Neill. “You don’t know how many of those you have left.
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Liz Weston writes for NerdWallet. Email: [email protected] Twitter: @lizweston.