by Finances okay? Check over. Set retirement date? Check over. Farewell party planned? Check over. You are ready! Wait a moment! Is that all there is to planning your ideal retirement? No sir! Retirement planning is about so much more than just money. Preparing for retirement requires a solid financial plan, but all the money in the world won’t make for a happy retirement if you don’t know what to do with it. Financial investments are crucial, but investing time and energy in creating a plan for your life is just as important.
The assumption that life will automatically be great if you stop working might be the biggest pitfall people fall when it comes to retirement. Of course, the “no plan” approach works for a while, but boredom doesn’t usually last long. If you want a happy retirement, then some effort and dedication to self-exploration will get you there. This self-reflective work ensures you avoid the four most common pitfalls associated with retirement planning.
1. No lifestyle plan
Careful financial planning is vital, but we tend to be far less thoughtful when it comes to planning how we’ll spend the next 30 or 40 years of our lives. The transition to retirement is so much more than a financial event. It changes your lifestyle and self-perception, and completely transforms your time. As a retirement coach, I often hear from anxious clients who are unable to visualize the rest of their lives. Planning for the rest of your life can be less daunting if you start before you retire. We cannot know what the future holds for us, but adjusting will be less challenging if you have the attitude that this is a time of opportunity and new beginnings.
Much has been written about the emptiness and boredom that can arise when you don’t have a plan. You’re less likely to run into problems if you’ve thought about how it’s supposed to be in advance. Retirement is a time to break away from your old self and create something new. Take the time to clarify your core values, discover activities that are meaningful to you, identify relationships you want to nurture, and create a bucket list. Spend time imagining what an ideal day, month, or year might look like. This pre-retirement work will help you deal with the emotional challenges that come with saying goodbye to your work identity.
I advise my clients to have a plan but take it lightly. Circumstances change as we move through life and your plan should change and evolve with you. For example, customers planning a trip need to consider how mobility or health changes might impact their plans. Do you need to consider traveling in a group, letting someone else take charge or should someone else drive? Good proactive planning can help reduce the potential negative impact of these inevitable changes.
2. Underestimating the previous lifestyle
It seems hard to imagine, but many of my retired clients are amazed at how much they miss parts of their old lives. After dreaming about it for so long, how is it possible that they miss work? Work offers much more than just a paycheck. Among other things, it offers self-esteem, meaningfulness, structured days and a social network.
Underestimating how much meaning these things add to your life is a common trap for retirees. Clients in my retirement practice who have successfully retired all report that they did some self-exploration work in the months leading up to retirement. They recommend taking stock of all aspects of your work that bring you joy, a sense of accomplishment, or boosts your self-esteem. Familiarize yourself with all the benefits and joys of your working life. Once it is clear what aspects of your working life you want to take with you into retirement, it will be easier to identify new activities or opportunities that will meet those needs.
For example, some clients report missing the learning opportunities that work provides. Retirement is a prime opportunity to continue learning and thriving, just outside of work. Consider learning a new language or instrument. You can also try your hand at woodworking. Planning and discovering new opportunities that can replace the benefits of work is a surefire way to succeed in retirement.
3. Not identifying purpose in retirement
You’re retired, so you can finally let go of this purposeful lifestyle and just relax. Not so fast! They don’t want to have to rely on old stories like “When I was a nurse, I saved lives” or “As an engineer, I designed amazing buildings”. These are great stories, but they’re about the old you, and retirement is the time to find new purpose and create new stories. Your new purpose doesn’t have to be grandiose. It can be something big, like solving the climate crisis, or it could be something small, like taking full care of your family.
Professor of Epidemiology Dr. Celeste Pearce says that a strong sense of purpose can greatly improve your overall quality of life and help you live longer. Retirees often feel a loss of purpose when they leave work. Your new purpose must authentically reflect you and the things that matter most to you. However you choose to express your purpose, it should bring meaning and joy to your life. Living a purposeful life also gives a sense of still being useful and relevant in today’s world.
4. Leaving meaningful relationships
When you retire, a significant portion of your social network will no longer be readily available to you. Research shows that a stable social network has a positive effect on your health and well-being. We are social creatures and most will agree that our happiest moments are when we are with family and friends who support our retirement vision. If we don’t invest time and energy in our important relationships, we risk having a lonely and isolated retirement.
Surround yourself with people who encourage you to keep growing and have a common goal. Close relationships also provide an opportunity to share your personal feelings, and this has been shown to play a role in reducing stress. Having great connections to draw on during the transition to retirement will ensure the process is smooth and enjoyable!
Transitioning into retirement is one of the biggest changes you will experience in your life. We all want success in our after work life. Before you retire, start visualizing it, try new activities, form new relationships, and consider new opportunities. A plan, a goal, and healthy relationships go a long way in helping you avoid the most common retirement pitfalls. Plan it and it will be possible!
