Retirement planning is a primary reason for long-term
saving, and when people think about retirement,
finances are often the focus. However, it is important
to also look at the nonfinancial aspects of transitioning
from the world of work to the world of leisure.
Specifically, lifestyle changes and self-esteem issues
associated with the loss of your professional identity
may create difficulties. As you’re preparing strategies
for your future well-being, give some thought to the
kind of retirement you envision for yourself.
Consider the following questions:
What do you find fulfilling?
What gets you out of bed in the morning?
What are your strengths and weaknesses?
Do you work well as part of a team, or do you
thrive on solitude?
Do you have a lot of physical energy, or do
you prefer a more sedentary pace?
Do you have a hobby you always wanted
more time to pursue?
Don’t be afraid to think outside the box. This informal
self-inventory may hold the key to your vision for
The concept of retirement in America is changing.
Traditionally, retirement has been idealized as a
leisurely phase of life, a reward for the many years of
working and raising children. This concept is based
on the assumptions that people will enjoy themselves
in retirement, and that work, as we commonly know it,
is the province of younger generations.
However, is this concept realistic for those of us still
years away from retirement, and if it is, is it what we
really want? Rethinking retirement means
reexamining conventional ideals to determine whether
they apply to today’s reality and what we envision for
Intrinsic to the conventional notion of retirement are
significant assumptions about work, money, and
retirement standards of living. For previous
generations, work was thought to be something you
did for about 45 years (until roughly age 65), and
then, suddenly, you never had to (or wanted to) work
again. A company pension, Social Security, and some
savings generally provided enough income for funding
a comfortable lifestyle in retirement, including leisure,
travel, and recreation.
If that’s what you want for your retirement, there is
nothing wrong with pursuing that goal. However, for
some, work is too much a part of their sense of “self”
to be suddenly cast aside. Moreover, with so much of their daily lives centered around work, some people
have difficulty imagining their life without that
Furthermore, changes in employer-sponsored
retirement plans (i.e., the decline of defined benefit
plans and the rise of defined contribution plans) have
altered our expectations about retirement funding.
The responsibility has shifted from employer to
employee, which means that an individual’s long-term
saving for retirement must now be factored in with
other savings objectives, like purchasing a house or
funding a college education for children, and ongoing
Finally, the traditional concept of retirement is based
on the belief that one’s standard of living will be
sustainable in retirement, and it may be for some. For
others, however, it may be more practical to ask what
standard of living can be maintained based on
This type of approach might help you see what is
realistic (and what may be unrealistic) in your
situation, and it may help you set more realistic
retirement priorities. For some people, downsizing
their standard of living in retirement may be
acceptable. For others, however, maintaining the
same standard of living during retirement as during
their working years may be the goal.
Consider phased retirement
As you consider the traditional concept of retirement,
you may discover that it doesn’t meet your needs.
Phased retirement is a term coined to describe a
range of employment arrangements that allow an
employee who is approaching retirement to continue
working, usually with a reduced workload, in transition
from full-time work to full-time retirement.
Many individuals may want to continue some form of
work, such as consulting, job-sharing, mentoring, or
providing back-up management. Mentoring, in
particular, enables an individual to transfer a lifetime
of learning and experience to a friend, relative, or
younger colleague. Aside from money earned from
continued work, phased retirement may help you
maintain a feeling of involvement in the world and
may provide a sense of purpose.
For some, phased retirement may be an option. For
others, it may be a necessity. For still others, phased
retirement may provide structure to daily life and the
opportunity to explore other activities while
maintaining a meaningful role within an organization,
the community, or society in general.
What’s most important, however, is to define your
vision of retirement in a way that makes sense to you
and is realistic considering your goals and resources.
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