Retirement ready - financially, mentally and emotionally
STUDIES focused on retirement satisfaction report people retiring today are unhappier than ever before. Experts in the field of retirement psychology find while some individuals transition smoothly into their golden years, others have a much more difficult time, and they typically don't talk about it because they're embarrassed.
"People think being prepared for retirement means proper asset allocation and income planning, but that's only part of the equation,” Beau Henderson, Financial Advisor and author of RichLife Retirement Resources said.
"Planning for the mental and emotional aspects of a successful retirement can be just as important (if not more so) than the financial planning.”
Mr. Henderson believes we will see a shift in the next three to five years where having a retirement coach to navigate the non-financial aspects of a successful retirement will be as acceptable as having a personal trainer to improve your health.
Mr. Henderson says there are seven important keys to winning the mental game of retirement:
Identity: who are you without your job? Have you thought about your identity in retirement?
Relationships: who are the people you feel closest to outside of the work place?
Meaning: what is your new life purpose?
Satisfaction: how does where you live affect your overall satisfaction and sense of well-being?
Experiences: what kinds of activities give you the greatest enjoyment?
Health: what are you doing to protect your primary asset?
Peace of Mind: what have you done to prepare for the changes that will likely come as you age? As your spouse ages?
Mr. Henderson says the ideal time to start planning for the transition from working life to retirement life is the 10 years before retirement. Of course, if you are past that mark, the best time is now.
"Retiring later in life is not a reliable strategy because life doesn't always cooperate with our plans” Mr. Henderson said. "There are multiple reasons such as health issues, layoffs, and having to be the care-giver for a loved one. The key is to have a contingency plan in place in case these don't work out according to plan.”
Two simple steps to ascertain if you are retirement ready include:
1. Know Your Numbers. Clarity alleviates fear and anxiety. You need to know your income, expenses, assets and liabilities. You can do these financial statements yourself or pay a flat fee to a financial advisor or money coach to walk you through the process of creating your basic financial statements.
2. Think Ahead. Start thinking about what you want your retirement to look like. Working part-time? Staying with grandkids? Traveling with a spouse? The clearer picture you have, the better you can plan for creating it or adjusting when needed. Write it out with as much clarity as you possibly can and share it with your advisors.
Check out the free retirement readiness checklist: go to RichLifeChecklist.com.