Thoughts on Retirement

What is retirement? We have a pretty simple definition. It is being able to do whatever you want to do, whenever you want to do it, and having the financial ability to do it.

Sounds pretty simple, right? It is basic. But, it is also the truth.

As a financial advisor, retirement is usually front and center in most of our conversations with clients. There are many things in life that are simple, but are not necessarily easy. Retirement falls into this category.

When preparing for retirement, a level of self-reflection is called for, in order to make sure that your thought process heading into retirement is in harmony with the realities of “being retired”.

Do you want to engage in more recreational activities, such as playing more golf, or going fishing, or perhaps coaching a sport you love? If so, are you physically fit enough to engage in these activities? Will engaging in this activity become a grind? In the past, you may have really enjoyed it, because it was an activity that wasn’t available to you very often, due to time constraints. When you can do it whenever you want, perhaps you find that you don’t want to do it as often.

Do you want to become more engaged in your community service activities? Will that engagement make it feel like a job after a while? If so, would you like that?

So, try to understand what really makes you happy. Then, try to understand what it would take to keep you happy over an extended period of time.

Then, and only then, should you engage in the financial planning process. Make sure that your cash flow will support what makes you happy. A good financial planner will probably try to find out what makes you “tick”, prior to making any financial recommendations.

Once we can get to the core of what your needs are, then we can get to the work of determining what type of cash flow will satisfy these needs over the course of your life.

In summary, engage in “big picture planning” for your life by finding out what’s important to you. It’s much like putting together a jigsaw puzzle of your life.

When I speak in public, quite often I’ll ask people what is the most important part of the puzzle. The answers I get are pretty typical: the corners, the edges, etc. They are then a little taken aback when I tell them that I think the most important piece is the picture on the box. If you don’t know what the picture should look like, how do you know how the pieces should fit together?

Find an advisor that is always trying to help you put the “picture on the box” of your retirement at the front and center of your financial plan, then helps you work towards making the picture a reality.