Retire To Something, Not Just From Something

A bank used to run a TV ad during the SEC Game of the Week where a man, talking about retirement, says he plans to do “absolutely nothing.” His wife then leans in and says, “He means it.” That’s not a plan for retirement, that’s a plan for a vacation. Be careful not to confuse the two. Planning for retirement isn’t just about the financial, it’s also about your post-career purpose.

We have clients who I have told a couple of times they’re “winning retirement.” They’re young, healthy and staying fulfilled with long-term avocations and projects that give them pleasure and also provide pleasure to those they love. And, in both their cases, their new interests are ones they learned after they retired. Let’s face it, our young and professional lives are spent learning and serving. After six-plus decades, do we just stop?

Conversely, I’ve observed several men over the years - yes, all male - who clearly believed that the title “legislator” was who they are, not just what they did. Not unlike being called Doctor, being Representative/Senator can be intoxicating, I’m sure. Some, after decades of service, retired. Some lost elections…and a couple are still there. I’ve often wondered how these gentlemen fared after they left office. Did they have a plan for what they would do in retirement, what their purpose would be?

I think most of us have a need to be needed – I know I do. While our careers can be demanding with constant phone calls, emails, texts, etc. asking us for something, have you ever paused to think how you’ll feel when no one asks anymore? Yes, the peace and quiet will be a nice change. But, at the same time, no one is asking your opinion or needs your expertise anymore either. How will that feel?

When clients are nearing retirement we, of course, refresh their financial plan for when there isn’t a regular paycheck anymore:

• Do they have enough saved to retire?
• Where will their income come from?
• How should we invest their assets to provide necessary income and so the assets outlive them, not the other way around?
• When should they start taking Social Security benefits?
• Do they have a desire to leave a legacy to their children? To charity?

An important part of the planning process, however, is to also help our clients think through what they will do in retirement – what they are retiring to:

• Do you want to learn a new skill, develop a hobby, learn about something you’ve never had a chance to explore?
• Do you want to volunteer for a charitable cause you care about?
• Maybe you want to consult so you can still share your expertise, just on your terms?

These broad questions and others are all critical and help clients picture what retirement might be like for them. It’s easy to picture staying up late, sleeping in, having coffee on the deck while reading the paper. Even a nap in the afternoon sounds appealing. But, dreaming about what work pressures you’ll leave behind is not a retirement plan.

Be sure to plan for what you will do in retirement to keep your brain engaged and to maintain your purpose. Plan to retire to something, not just from something.  

Steve Byars, CFP®