by Samantha Pahlow, CTFA, AWMA
Wealth Management Chair
Retirement is a milestone most people spend decades planning for, ensuring they have a strong financial foundation to support their ideal retirement lifestyle. Yet, stepping away from a lifelong career as well as shifting from saving to spending can be more emotionally impactful. While most are justifiably excited about the prospect of retirement, the transition can bring unexpected challenges.
Challenges in retirement can include:
Distribution Mindset: After years of accumulating wealth, the idea of drawing down those assets can feel counterintuitive or even guilt laden. It’s important to recognize this emotional shift.
Loss of Career Identity: For many, a career is a significant part of their identity. Leaving it behind can lead to a sense of loss and disconnection.
Disruption of Routine: A structured daily routine provides a sense of purpose, predictability and organization. The sudden loss of your work-related routine can be disruptive and frustrating.
Despite these challenges, there are several steps you can take to lay the groundwork for an enjoyable transition into retirement.
1. Build Financial Stability: First and foremost is to have a solid financial plan, ideally starting many years before retirement. Knowing you have the financial means to support your lifestyle, especially in today’s world of increasing longevity, can provide a feeling of security and alleviate the stress of living off your savings.
2. Find New Purpose and Social Connections: With your increased time, consider volunteering, hobbies or community involvement. These activities can provide a sense of purpose and fulfillment. They can help maintain routine and structure, and foster a sense of belonging and community—all of which support emotional well-being.
3. Stay Active and Healthy: Prioritizing physical fitness and mental health can contribute to a more satisfying and enjoyable retirement. It’s also wise to prioritize travel and other physically demanding “bucket list” goals early in your retirement. You are likely to be more physically fit and able to enjoy these experiences to their full potential.
4. Consider Phased Retirement: One effective way to ease into retirement is through a phased retirement—a gradual reduction in reducing work hours and responsibilities. According to a recent report from the Stanford Center on Longevity, phased retirement can help maintain a sense of purpose and social engagement. It also extends your earning years and may come with continued healthcare benefits, reducing the draw on your retirement assets.
The transition into retirement is an exciting one. Acknowledge the significance of this milestone and take proactive steps—such as ensuring a solid financial foundation, prioritizing physical and emotional health, finding new or renewed purpose and maintaining community and social connections. Retirees can navigate this next chapter with confidence and satisfaction. Embracing these needs can help ensure that your retirement years are not only financially secure but also richly rewarding.
Ferguson Wellman, Octavia Group and West Bearing do not provide tax, legal, insurance or medical advice. This material has been prepared for general educational and informational purposes only and not as a substitute for qualified counsel. You should consult qualified professionals to understand how this information may, or may not, apply specifically to you.