Sometimes planning can leave you lost in details. We believe, in its simplest form, retirement planning requires you to consider two chief components: The first is saving for retirement, and the second is planning on how you will spend your time during retirement.
In this week’s MoneyDo we suggest you begin thinking about how you think you’ll spend your free time during retirement.
Expect the transition from the structure of working 5 days a week to retirement to take time. During this period, it’s normal to experience disruption and confusion. Ultimately, there are 3 components to a successful retirement; identity, relationships and purpose. Understanding these components will ease the transition.
- Identity: We spend a considerable amount of time working and thus begin to define ourselves by our job title. Remember, you’re more than a job title.
- Relationships: Many retirees find they don’t miss work but they do miss the relationships they developed. It’s important to build and maintain your network, even in retirement. Do you have a networking strategy in your retirement plan? It may involve spending an hour a day on Twitter, LinkedIn or Facebook “conversing” with people who share your skills and interests. Perhaps you may join a group that meets regularly to discuss or participate in a shared interest.
- Purpose: It’s very important to have an understanding on how you’ll spend your time in retirement. Often, we plan for a retirement date but don’t consider the years after. Do you want to travel, have a part time job, or do volunteer work?
Start by listing objectives and begin to define how you envision retirement. For now, don’t focus on budget. Focus on ideas, and be as specific as you can. Once you have concrete ideas, you’ll find planning becomes more tangible and realistic. For example,
- Instead of writing “travel” on your list, create a list of places you want to see and activities you want to experience.
- Instead of “stay involved in my community,” write down your passions and organizations you want to impact.
The more descriptive you are, the more tangible your retirement will be, which can help keep you focused on a realistic set of goals, which often helps make them more attainable. We feel an active lifestyle is a key component of a successful retirement.
If you’re years from retirement, this exercise can add more meaning and motivation to your plan.
If you’re already in retirement, you can always revisit and recreate your purpose for the next couple years of retirement. Is there that vacation spot you have always wanted to visit or distant relatives you would like to reconnect with? People are living in retirement longer and it’s important that you are not only financially ready but that you have also considered your quality of life during those years.
