Preparing for retirement, what to consider

Where Are the Red Flags in Retirement Planning?

Most of us cannot afford to stop work at 65 and we are increasingly likely to live another 20 to 30 years.  The term ‘retirement’ was first introduced in 1889 when people were expected to live another 1-2 years after stopping work.  Baby Boomers are turning the concept on its head.

There is however, a noticeable shift that takes place in our lives during our 60’s.  If you are lucky enough to be able to continue in your present job after you turn 65 you may not feel this shift as acutely as those who are officially booted out of an organization because of staff policy.

Most people when they think of retirement planning will think of the financial aspect.  By the time you reach your 60’s it is too late to remedy this if you have not put enough by already.  In narrowing their focus in this way,  they tend to neglect the other aspects of their lives which play a major role in determining whether these latter years of their lives can become their ‘golden years’ or not.

It is these ‘other aspects’ that I would like to flag:

Work

I love the saying that retirement is ‘when we stop living at work and work at living’.  It really encompasses that feeling that for most of us work will continue in some form, but we have the opportunity in our 60’s to do something that we are really passionate about and that gives us more flexibility to enjoy life.

For those that continue in the same job there is often a shift in thinking.  Because of slowing physical stamina they tend to find themselves shifting to more strategic thinking which can be extremely helpful because they now have all these years of experience under their belt.   If you are running your own business an important, but neglected part of planning for retirement is succession planning.  A couple of years ago, I had the unenviable task of taking over from a 72 year who was thinking of retiring, but had not put a succession plan in place before she died one Sunday of a heart attack. And then for those who will be formally retiring from a big corporation there is often the need to continue working (be it financial or driven by a need for purpose), and because of the high unemployment rate they mostly turn to self-employment.

Marriage

Very often the marriage contract needs to be re-negotiated when one or both parties retire.  If one partner has not been working, they usually have a whole life mapped out that does not include the working partner.  Similarly if one partner retires and the other keeps on working, there needs to be a readjustment of responsibilities in the home. If both have been working and retire together, there will probably need to be a major realignment of their lives to being together 7 days a week.

Identity

How often do we find ourselves talking to people we do not know and asking what they do?  Our employment status is an important part of our identity.  When you retire, you leave all that behind and simply become a Retiree or Pensioner!  Many people, especially high-powered business executives find this transition difficult to make, and thus it becomes another red flag item.

Health

These days with the expense of medical care we need to invest time and energy into making sure we stay healthy for as long as possible to stave off these costs.  With a more flexible working schedule retirees have more time to exercise and take care of their health, but there are some hidden dangers like loneliness and boredom which take their toll on our long term mental and ultimately physical health.   Keeping one’s mind active becomes an essential part of looking after our mental health. But I will leave the health details for the Lifestyle Clinic.

Accommodation

It is not necessary to make adjustments to one’s accommodation in your 60’s, but it would be advisable to start with the research and planning at this time.  For many the cost of moving to a retirement village is becoming prohibitive, so they are planning to grow old in their own homes.  If this is the choice it is advisable to consider down-scaling while you are still fit and healthy.  Careful thought should be put into where you want to live when you become frail and mobility becomes an issue.   Often neglected is planning ahead for the time when home-based care may be necessary.  Moving to a retirement complex involves putting ones name down on a waiting list well in advance – some waiting lists are closed to people over 60 or 65.

Social Networks

During our working lives our social lives tend to be restricted to the weekends.  When you leave the work situation, not only will you be leaving your work friendships behind, but you will need to fill 7 days a week with some form of social interaction.  Many will need to look outwards to find people with similar interests and broaden their social circle. As mentioned earlier, loneliness and boredom can have a profound effect on one’s health.

Financial

The long term investing and conversion of that investment into an income is best handled by a professional Financial Advisor. Retirement often involves changing to a fixed income and one needs to look to what can be done to pare the budget and work out where to make use of discounts for seniors.  I remember the first time a teller asked me if I was a pensioner and I was horrified as I was in my 50’s.  Now I actively plan my shopping around seniors’ discount days.

Purpose

In summary, probably the most important red flag of all is finding that sense of purpose in your life in retirement.  The thing that is going to get you out of bed in the mornings, excited about the day ahead. For many years working to earn the bread and butter and support a family has given your life purpose and structure.  For some, retirement will bring a chance to do all the things they have wanted to do but never had the time for, but for others it will bring a prolonged void.

NuHorizons Life Coaching offers an opportunity to explore these red flag areas in the context of your own life.  It is ideal to start this planning about 2-5 years before you actually retire – but for some it is only after the initial period of retirement is over that they realise that the transition is not as easy as initially anticipated and may require some help.  For more details visit www.nuhorizons.co.za.

For more on this subject, Hilary has published a book called “7 questions to answer before you turn 65”, available on www.loot.co.za or Amazon.