Retirement Requires an Emotional Plan, Not Just a Financial One

Investing
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By Laura Scharr-Bykowsky

Learn more about Laura on NerdWallet’s Ask an Advisor.

You’ve worked hard for decades, invested carefully, and now you have enough money to live comfortably for the rest of your life. That means you’re ready for retirement, right?

Not necessarily. Although money may not be a concern, that doesn’t mean you are emotionally ready to make the big leap to a retirement lifestyle.

Many aging baby boomers long for a life of leisure, increased travel and unstructured days. Unfortunately, once you remove work from your life, leisure becomes less desirable, and perhaps even monotonous. After several months of retirement, many people find that they miss the routine, social interaction and sense of purpose that a job provided. Some keenly feel a loss of status, even identity.

Research shows that retirees are at increased risk for the three Ds — depression, divorce and disease.

A report from the Institute of Economic Affairs shows that “following an initial boost in health, retirement increases your risk of clinical depression by 40 percent while raising your chances of being diagnosed with a physical condition by 60 percent.”

The incidence of “gray” divorce is on the rise. Among people ages 50 and older, the divorce rate has doubled over the past two decades.

A study of Shell Oil Co. employees found that people who retired at age 55 had almost twice the risk of death compared with people who retired at age 60. In addition, people who retired at 55 were 89% more likely to die in the 10 years after retirement than those who retired at 65.

How can we protect ourselves from being a victim of these grim statistics?

The best way to plan for the qualitative aspects of retirement is to create a vision of your ideal retirement. Specifically, you want to think of ways you will fulfill your bucket list, engage socially with like-minded people, and spend time on new or existing hobbies. You’ll also want to proactively discuss aspects of your retirement with your spouse and plan a healthy lifestyle.

Here are several smart steps you can take:

  • Create a Pinterest board, collage or list of places you would like to travel, activities you would like to explore and people with whom you want to connect. Make this as visual and specific as possible. Explore all the items on your bucket list.
  • Construct an ideal day/week/month/year in retirement. Determine how much time you will allocate to being active, socializing, volunteering and engaging in household chores. Creating this vision will help you better understand how you will spend your time.
  • Discuss with your spouse his or her expectations for retirement. Where will you live; where do you plan to travel? Decide how much time you will spend together, with friends and family, and doing solo activities. It is often hard for one spouse to become accustomed to having the other home 24/7. Scheduling time alone or away from your spouse may be better for the relationship.
  • Ease into your new lifestyle by working fewer days in the months and years leading up to your full retirement so that the change is not as abrupt. Start test-driving some new hobbies before you retire.
  • Decide how much time and money you’ll spend traveling and connecting with loved ones. You may want to relocate to be closer to your kids or grandkids.
  • Take care of your health. If you are proactive and intentional about a healthy diet, exercise and scheduling doctor appointments, you will maintain or improve your health and hopefully minimize health care costs in retirement.

These steps have the added benefit of giving you a better understanding of your expenses in retirement. When you create a clearer image of your goals, you have a more accurate estimate of how much money you will need to achieve these goals.

If you have financial questions about retirement, check out some of the questions and answers on NerdWallet’s Ask an Advisor platform.

The bottom line

Start preparing now to get the most enjoyment from the wealth you’ve worked so hard to build. If you align your money to your desired goals, you’ll be on track for a more rewarding and exciting retirement journey.