... Several Perspectives on Retirement Planning ...
by Alan Weeks for the ARCR

FINANCIAL PLANNING

When started early, financial planning helps people understand their financial strengths and weaknesses and to set their short and long term goals. If followed, a good plan will help realize those goals.

If you are already retired, we hope that your goals have been achieved. Perhaps, this advice could be shared with the younger generations in your family.

With the average lifespan now forecast to be 83 years, why do many financial plans only address the last 18 of them?

A large number of investment decisions are made throughout our lives. They make significant differences in our immediate and long term lifestyles. For example, investments in luxuries during our peak earning years can divert substantial money that could otherwise be used to quadruple our retirement “nestegg”. Hence, financial planning should be an adult lifetime activity.
Invest wisely!

DO I HAVE ENOUGH MONEY TO RETIRE?

This is a familiar question posed to financial advisors. The problem is that there are two forms of spending in retirement - money and time. It is impossible to answer this question from a strictly financial point of view because each person should be planning for more than just a financially comfortable retirement. .

A major factor affecting the amount of money needed in retirement is, of course, the lifestyle one chooses. There are a wide range of costs associated with each choice; from modest existence in an economical location to luxury travelling.

WHAT ARE YOU DOING AFTER WORK?

Far too many people, particularly men, think of retirement as a time when they have finished working. But, retirement should really be looked upon as the beginning of a second career. Those who seem to be the most contented after retirement are those who continue to be physically and mentally active.
One should look on this long period “after work” as an opportunity to do those things that were found to be the most interesting and enjoyable during your working life.

Retirement is also the perfect opportunity to let the fun begin. We should have more freedom and time to enjoy life to the fullest.

TO MOVE OR NOT TO MOVE?

Retirement is often a time when people think about moving, for many reasons. Frequently, the children have already moved far away. Many look for cheaper places to live. The prospect of better weather is also very attractive.

Ties to a home based on job obligations are gone. In many cases, with the children also long gone, the family home has become a large empty asset.

In addition to thinking of the financial and other benefits of moving, future retirees should also think about how they will spend their time when they get there.

Don’t be like those who come from a very challenging (and stimulating) career in a northern climate to live the rest of their lives in a shack on a beach in Costa Rica. Two weeks or two months later, many are miserable from the constant heat and are “bored to tears”.

DON’T BURN YOUR BRIDGES

If for some unforeseen reason, the move does not work out, what are your alternatives? We suggest that people not “burn their bridges” and not lock themselves into the new location until they are certain that it is right for them.

Renting in a probable area of interest for many months gives you the opportunity to find out. As you become much more familiar with the various communities, accommodations, social activities, and meet people with similar interests, a different location may seem more appropriate for you.

Hence, our advice is not to make a housing decision too hastily. It is a lifestyle as well as a financial investment.

In summary, it is vital that you retirement “nestegg” is securely and appropriately invested to support your chosen lifestyle and legacy. But it is also very important to plan the lifestyle side of retirement. Do you have worthwhile and enjoyable alternatives to look forward to in retirement?