Flipping The Spend/save Switch
Changing your perspective on spending money can be a mental hurdle for some. It can be hard for someone who has saved their entire career and been frugal to allow themselves to spend the money in their retirement accounts. On the other hand, it can be difficult for some to rein in their spending if they must spend less in retirement than what they were accustomed to during their working years. People often ask, How do I know what I can spend each month? and How am I going to get my money each month? Changing spending behaviors, habits and lifestyles can be hard. Working with a financial planner to estimate amounts and automate withdrawals from specific accounts can help eliminate some of the stress involved with these spending decisions. Keep in mind that if you do not spend your money, someone else eventually will.
Make A Retirement Plan
After decades of thriving in a fixed routine, it may not feel natural at first to do as you please with your time. To fend off those feelings of demotivation and boredom, it is a good idea to make a reliable retirement plan.
While this might sound tiresome , you will feel real satisfaction when your days are shaped with activities which offer a full and stimulating retirement.
To get started, think about the kind of things you would like to achieve. Whether this involves writing a novel, learning to play an instrument, or ticking a travel destination off your bucket list, engaging with activities which motivate you will give you greater purpose in later life
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And if youre planning with a partner, you wont be charged twice.
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- Looking to consolidate multiple pensions
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CEO and Founder – Boring Money Digital Advice Group
Peace of mind for 50+ customers planning for retirement who want some advice and someone to tell them what to do without paying over the odds or getting anything too fancy.
CEO and Founder – Boring Money Digital Advice Group
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Prepare Physically For Retirement
Have you ever thought about your physical readiness for retirement? If your retirement dream includes active pursuits or playing with your grandkids, now is a great time to think about ways to get physically ready to do those things. Here are five ways you can be physically ready for retirement.
Move your body daily: We all know we need to do it, but make it a high priority in your years leading up to retirement. Youve been taking care of other people, now take care of yourself by exercising every day. Find something you enjoy doing!
Eat healthily: Increase your fruit and vegetable intake, decrease your sugar and simple carbohydrates, drink tons of water and get your protein! These simple changes will give you more energy to pursue your retirement dreams.
Start taking supplements: Talk to your doctor about helpful supplements that will have you feeling your best when you retire. Some helpful options include brain and memory boosters, eye health, collagen, Vitamin D, and a daily multivitamin formulated especially for people over the age of 65.
Give up bad habits: If youve had quit smoking on your New Years Resolution for years, retirement is an even better incentive to kick the habit! Think of all of the money you can save by giving up bad habits like smoking, drinking too much, and/or overeating. Then, think about how much more enjoyable your retirement will be if your health is optimized. Youve got this!
Finding A Sense Of Meaning And Purpose
Occasionally retirees experience a loss of identity. If you have always viewed yourself through the lens of your profession-as a teacher, doctor, accountant, etc., or if you have a strong attachment to your employer, you may find that you miss that part of your identity.
Retirees need to find meaning and purpose in their new stage of life. You need to find something else to fill your time, and it needs to include something that gives you fulfillment, whatever that might mean to you. If all your fellow retirees enjoy golfing every day, but this is not something you find fulfilling, then dont feel obligated to golf every day. You should take some time to explore what will give you a renewed sense of meaning and purpose. Maybe that means spending more time with your grandchildren or doing some volunteering in your community. Many people these days look at retirement as an opportunity to pursue a part-time encore career or a new direction. The possibilities are endless.
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How To Mentally Prepare For Retirement Before And After
Before: You used to ask yourself if you were saving enough money.
After: Youll ask yourself if what you have saved will last.
Before: You used to set retirement savings goals.
After: What you spend matters more than what you save.
Before: You used to optimize your portfolio to reflect your growth needs and risk capacity.
After: You still should do that. But a likely downshift has probably occurred in your risk tolerance.
Before: You used to work full-time for your primary source of income.
After: Your investment are most likely your primary source of income.
When you think about it, suddenly moving from working 40 hours a week to zero can be a real shock to your system. Although it may sound great in theory, the truth is that were creatures of habitand we dont always react well to quick and dramatic changes.
Some employers will allow you to ease into retirement by gradually shortening your workweek over a year or a couple of years. This can be a great way to get your toes wet before diving right into full retirement. Use your days off to discover new hobbies, start volunteering, meet with friends and begin developing a new routine you can expand on throughout retirement.
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Preparing Emotionally For Retirement
Retiring is a huge life event, and can sometimes leave us feeling like weve lost our identity. 70-year-old Jay Cassie talks to us about how she prepared emotionally for retirement and the 3-point plan which helped her.
After working as Exhibition Coordinator for Earls Court and Olympia for 22 years, Jay left to work for a security company in the exhibition event business.
After that, she set up her own security company with two partners, which she still owns but doesnt work in. She decided to retire when she was 63.
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Having Structure To Your Day
If you were a person who thrived on structure before you retired, you likely will benefit from having some type of structure to your day when you are retired. Having a set wake up time, routine activities and mealtimes, and set bedtime can help with the transition. Whatever schedule you choose, it is helpful to use some form of planner. Writing it down helps you decide and remember when to do what. What types of activities work best at what times is not always obvious and are not the same for everybody. The Wall Street Journal recently shared some good suggestions on ways to construct your morning, afternoon, and evening schedule for a productive and happy retirement.
How Can I Prepare Emotionally For Retirement
Simply understanding that you need to prepare emotionally for retirement is a great first step. With a good level of self-awareness, youre more likely to seek help and progress through the emotional stages of retirement more quickly.
Be honest about how youre feeling
When youre working, everyone says they want to retire. Long days, bad days, horrible bosses they can all make retirement seem like a Shangri La, a promised land. But as you approach retirement, you realise that it can also represent a loss. And thats ok.
You might feel like you have to be positive about retirement, laughing as people joke theyd love to be in your shoes. But only you are in your shoes and only you know how youre feeling. Dont be ashamed to admit things dont always feel as rosy as people expect.
Write a list of everything thats worrying you
It can be hard to put your finger on why youre worried about retirement. Obviously, everyone wonders about the financial side of things, and going to see a financial adviser can help put your mind at ease.
But what about the other things? Maybe youre not sure whats stopping you? Or maybe you know but you feel ashamed to admit it.
Dont worry. Grab a pen and paper and start writing things down. Its just for you, so be totally honest. Committing things to paper is a great way to start working out the barriers youre facing.
Think of ways to counteract those worries
Once you know whats worrying you, you can think about ways to overcome it.
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Many People Have A Financial Plan For Retirement But Not A Psychological One Here Are Some Tips To Help You Plan
When Nancy Schlossberg retired at 67 she thought it would be smooth sailing. It was a difficult transition.
Over the next few years, Schlossberg, a psychology professor at the University of Maryland, interviewed more than 150 retirees and found that many people spend years preparing for the transition, but others dont think about it until they actually quit working. Her research became books called Revitalizing Retirement: Reshaping Your Identity, Relationships, and Purpose and Retire Smart, Retire Happy.
She recommends taking a hard look at three areas of your life when you retire:
Your identity. You can think of it as what you put on your business card or your tagline under your e-mail signature, she says.
If you are a roofer, painter, artist, teacher – thats part of your identity. One man who retired as CEO of a Fortune 100 company had plenty of money for his golden years, but he said his retirement felt hollow because he hadnt thought about his new identity.
Some people may be OK with saying retiree, but others will be happier if they strive to define a post-retirement identity that will provide structure to their days and meaning to their lives.
MORE ON THESTAR.COM: Average age at this firm is 65
This is the perfect time to spend more time with your children and grandchildren.
Schlossberg identified the following ways that people approach retirement:
Get Your Finances In Order
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Consider All The Things That Make You You
Many peoples identities are heavily tied to workespecially in the education sector! But theres so much more to you than your work, even if it doesnt seem like it some days. Think about all of the different aspects of your identity outside of work. It might be helpful to write them down. Do you enjoy gardening or cooking? Are you a curious, life-long learner? Are you a member of a faith community? You can ask friends and family for input, too, if youre having a hard time coming up with ideas!
Who am I without this 24/7 job? Once I retired, I realized I had nothing to be afraid of this IS great. It was a lot easier to embrace the identity of retired teacher than I expected.
Carla Matos, RTOERO member
Tips For Transitioning Into Early Retirement Prepare Mentally
In this three part series, I give tips to help people who are transitioning to early retirement. The previous two posts suggested tips Before Quitting and Things to Do. This last post will focus on how to prepare mentally for early retirement. Getting into right mindset is important for early retirement. It will help you weather the mental and emotional challenges that can come from quitting your job.
Manage expectations. Its easy to build up early retirement to be the answer to all of your problems. Its the answer to some of your problems, but not all. In my early retirement, productivity and time has felt drastically different from when I was working full-time. This was very unexpected for me. It took time for me to establish new routines and find new friends. Things didnt happen overnight and there was a lot of lull time between activities for me. Joe from Retire by 40 once commented on my Fantasy vs. Reality of Early Retirement post that the retirement life is just regular life without work. I agree it wont always be beach vacations.
Talk to family members about their expectations of you. Unfortunately, Dragon Guy and I didnt really talk about our expectations for my retirement. I came into my own retirement with certain unvoiced expectations. So did he. But we never had a formal conversation about it. As a result, some fighting occurred, mostly around Dragon Guy expecting home cooked meals for himself when he came home from work, and me not wanting to cook .
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In Sum: Final Thoughts On Being Psychologically Ready To Retire
According to the most recent Economic Well-Being report, published by the Federal Reserve, retirement was voluntary for 55% of respondents, while 45% of retirees claimed they were forced into retirement due to health issues , caring for a family member , and being and forced to retire or lack of work .
What these numbers reveal is that sometimes retirement can come sooner than you expected. Therefore, its not only critical to be financially prepared to enjoy retirement, but also to be equipped to handle the psychological and emotional sides of retirement. Hopefully, this post gave you a good start.
S To Prepare For Retirement
Heres a quick overview of ways to prepare for retirement:
- Create a budget for that retirement that includes:
- Figure out how much money youll have/need
- Sort out life and/or medical insurance
- Open tax-efficient retirement accounts
- Find out about employer-matched pension plans
Lets break these down.
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Talk To Other Retirees
Even if youre excited about retirement, you might also feel some fear or uncertainty as you approach your retirement date. It can help to talk with friends who are already retired about what they went through during the transition. You will learn youre not alone with how youre feeling. It may also help to have a friend or someone else to confide in about your feelings.
Do Some Soul Searching To Establish Your New Lifes Purpose
After thirty or forty years of going to work to earn an income for you and your family, it is crucial to replace that main purpose in life with something meaningful. Everybody needs to have a reason to get up in the morning.
Before retirement, think about the different interests youve had and examine which of those interests is worth your while. Many seniors turn to volunteer work or a part-time job that fulfills them. The good news is that there are many ways to stay busy and feel good about what youve accomplished at the end of the day. The hardest choice is often which ideas to eliminate.
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Expand Your Social Circle
If your social life has always been tethered to your job, whether by colleagues or commuting, you may find yourself with a small social circle come retirement. For some, cutting ties and forging tighter, closer connections can be a relief. For others, it can lead to feelings of isolation.
According to Age UK, 1.4 million older people are chronically lonely in England. Studies have even linked loneliness to worsening symptoms of physical problems, such as heart disease, cancer and diabetes.
However, as many will know all too well, it is not easy to strike up new friendships in later life. To keep yourself socially active, you simply must put yourself out there. Join a golf club, get green-fingered at your local allotment, volunteer at a charity, or hop onto social media to reconnect with old friends.
To find a community group or activity in your local area, head over to Age UK.