Retirement: Are There Any Do-Overs?

Do-overs don’t happen very often in life. The only one that comes to mind is the provision in the Social Security system that says if you think you made a mistake in the timing of your sign up, you have twelve months to change your mind.

In conversations with existing and former clients, from time to time we talk about opportunities missed. That may have happened because we were otherwise occupied, or we simply failed to pay attention. To the extent you are not yet retired, there are lessons to be learned here.

The Dynamics of Retirement is a book I published recently (the first 20% is free…). It’s primary purpose is to help those who belong to GenerationX, people in the 40-55 age range. For them, retirement is a looming reality that will arrive before they’re ready. The book talks about the variables that will seriously influence their retirement and the steps to take before it arrives.

Additional clues might be found by exploring what people who are now retired might have done differently. An analogy can be made to becoming a new parent. You’ve never done this before, and your success or failure is sometimes a function of how you were raised. No amount of reading how it should happen really prepares you for the reality.

It’s much the same with retirement. For most of us, we’ve been working and earning a living for the past 45 years or so. When retirement arrives, you shift gears to handle the new hills and valleys you’ve not seen before. What can we learn from those who’ve driven this road already?

Prepare for the personal side of things.

It goes way beyond financial implications. Up to this point, much of the “noise” that fills your brain about retirement is about having more money. And while that’s a critical element of life in retirement, it’s far from the only thing.

What will you do to keep your brain and body engaged in meaningful activity? Sure, you might want to spend more time fishing, or playing golf, but with nothing else to do, that too will become tiresome.

The kids, assuming you had kids, are busy leading their own lives. They have their own identity, their own friends, their own goals and ambitions. They don’t have room for you to move into their world. So apart from visits and time spent with possible grandchildren, you have to define your own new identity.

If your retirement meant the abrupt end of a job where you interacted with fellow workers and you had a daily identity, that has to be replaced somehow. Initially, you can rejoice in not having to show up every day, but we all need a reason to get up every morning and have something to look forward to.

The point made by many retirees is the need to include “lifestyle planning” in the getting ready for retirement process. It’s reflected in some of the 8 primary questions included in my book. These are questions that everyone must ask of themselves, and answer, in the lead up to retirement.

Identify what you can control.

What are the existential threats that worry you the most? We easily think that running out of money before we run out of life is the most critical. But that’s probably years into the future. What can you control now?  Many current retirees say they should have started saving money sooner. It helps to have an awareness that success, however you choose to define it, requires time, effort and discipline.

Developing an understanding of how money works is incredibly difficult for some people. So, if you realize you don’t have the necessary skill sets, find someone who does that you can trust to help you. The trick is being able to identify that person.

Chances are you can control your own behavior. Perhaps not as well as you’d like to, but you already know what has to happen. So, make up your mind and do it. I make a point of identifying the steps to understand so that as the years roll by, you’ve got a road map to follow and be better prepared when retirement arrives.

As someone well into my “retirement” years, health issues and what they ultimately cost are increasingly troublesome. But paying attention to what you eat and the exercise you do or don’t get when you’re a GenX person will make a difference. You can control that if you want to.

Know there are going to be unexpected consequences.

We don’t live in a perfect world. As someone once said, the only sure things in life are death and taxes. Along the way, we’re going to experience economic shocks of some kind. It may be a job loss, a health issue, something critical involving our children or our parents that we’re forced to deal with.

Insurance comes in many forms. The primary idea behind insurance is to somehow transfer the risk of something bad happening to a third party. We never drive off the lot with a new car without making sure we’ve insured it. We never buy a house without making sure we have homeowner’s insurance.

The financial consequences of dying before we’re ready for it is mitigated by life insurance. It can’t replace you and the value you bring to your family, but it can begin to offset the negative financial consequences. Retirees I talk with often ask me whether they should have a life insurance policy. My first question involves their health and age, since those two things are critical. They’ll have to pay money to a third party, an insurance company, always assuming they agree to accept the financial risk associated with your death.

Ideally, a life insurance contract needs to be purchased before you have a need for it. You do it for your car, you do it for your house or apartment, why not your life? If you’re reading this, you already know life has a way of happening when we’re making other plans.

When it comes to investment choices, an annuity contract can offer a retired person the ability to avoid a financial shock if the market crashes. Not having to watch large chunks of your hard earned savings go down the drain is a huge plus. Annuities accept the existential risk of loss in exchange for a fee that allows you to sleep at night.

These things matter to most retirees, and many wish they had a do-over. There’s no way to fix every mistake along the way, but you can be aware of what mistakes might surface and cause you grief. Learn from those who go before you.

Having a good idea how you want your life to play out goes a long way toward securing a worry free and financially secure retirement. The first 20% of my book, Dynamics of Retirement , can be read for free, so I encourage everyone who has read this far to at least take that first step.

Tony Kendzior \ 22 JUL 2022

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