Is your retirement planning focused solely on dollars and cents? If so, it’s time to broaden your view.
While things like target savings goals and 401(k) balances are crucial to creating a comfortable retirement for yourself, there are some important pre-retirement considerations that have nothing to do with money at all – namely: how and where you’ll spend your new-found leisure time, and who you’ll spend it with. Not only are these important considerations for your lifestyle in retirement, where you will spend your retirement and with whom might impact your finances.
If you want to enjoy a healthy and fulfilling retirement, take the time to consider these four lifestyle factors while also understanding their potential financial impact:
-
Are you and your spouse/partner retiring at the same time?
Many couples retire at different times, either due to necessity or based on personal choice. When this happens, it’s important to plan ahead for the very real shifts that will take place in your everyday life. That’s why it’s so important to communicate with your partner and ensure you’re both on the same page. Talk about the expectations you both have for what your days will be like when the first person retires. Work out things like household chore responsibilities together and commit to navigating your “new normal” as a team. While the retiring spouse may be feeling excited at the prospect of starting a new chapter, it’s important to realize that the spouse who is still working will not be starting that particular chapter yet. Your shared life is important, but this is also a time in life to consider your individual goals and dreams. Open communication and advanced planning can help to smooth this transition.
On the financial front, consider whether one spouse’s income will provide for all your needs in immediate retirement, or whether you’ll need additional resources. Take the time to consider when to begin drawing Social Security benefits or taking distributions from your retirement accounts.
-
Do you plan to relocate?
Plenty of people move when they retire, oftentimes to downsize to a smaller space with less upkeep or to be nearer to children and grandchildren. For some, it’s all about seeking out nicer weather to enjoy year-round. Finding the change you’re hoping for in a move isn’t a given, however, and it may not be the best choice for every retiree. It’s a big decision to uproot your life and move to your dream location, and without proper planning, it may end up in unhappiness.
Even if you want to move for a great reason – say, proximity to grandkids or the ability to take up a warm-weather hobby that interests you – you’ll likely need more than that to find fulfillment. Ask yourself if the location you have in mind will be ideal for you in all four seasons. Consider whether it has other things that are essential to you, like a religious community and the opportunity for a social network. In short, try to focus on a place where you can build a full life for yourself.
Financially speaking, know whether you want to trim expenses with your move or whether you’re okay with taking on a more expensive lifestyle. It’s healthy and fun to dream about plans for the future, but making a move that isn’t supported by your finances could end in disaster.
-
What are your shared and personal goals?
The wonderful thing about retirement is that you’re handed a blank slate on which you can build the lifestyle you’ve always dreamed of. The challenging thing about retirement is… well, how to fill that blank slate! With so many options of how you might spend your time, it’s easy to get overwhelmed at the prospect of filling your calendar.
Take time now, before you retire, to think about how you want to spend your days. Many retirees find they are happiest when they can find some meaning and purpose in this chapter of life. Try to make some big-picture decisions first, like whether you want to add meaning to your days by volunteering locally or whether your hobbies and social network will keep your calendar full. Think through your goals, big and small, and jot them down. They don’t have to be things like traveling the world or starting that business you’ve always dreamed of – though many retirees do these things. It’s perfectly fine if your goals are smaller, and you don’t need to have them all figured out on day one either.
One major question that will factor into how you spend your time is whether you think you’ll need to supplement your income with part-time work or consulting. If this will be a necessity, strategize about how you’ll set this plan in motion first, then build your new-found leisure time around it.
-
How will you care for your physical and emotional health?
You want to make the most of your retirement, and that simply won’t be possible if you don’t take proper care of yourself – your whole self. Exercise, nutrition, and mental and emotional health are all important pieces of the self-care puzzle, and you should consider how you’ll incorporate each into your retirement lifestyle. Maybe you’ll take a yoga class that will help you build balance and flexibility while also providing a way to de-stress. Maybe you’ll sharpen your home cooking skills by cooking your way through a plant-based recipe cookbook. You might even set a big goal for yourself like running a marathon – the sky is truly the limit!
If you already know that you’ll have special expenses related to your health and wellness, plan to accommodate for them in retirement. This could mean utilizing a Health Savings Account (HSA), for instance, or purchasing long-term care insurance.
Final Considerations
Retirement is a major life change. While planning ahead by asking yourself the above lifestyle questions can help with the transition, recognize that there will still be ups and downs and you may need to make course corrections along the way. Try to keep an open mind and an open heart, as well as open communication with your partner. Be gentle with yourself as you adjust to this new phase of life and focus on the positive aspects if you begin to feel overwhelmed.
Retirement can be a truly wonderful time in your life. By spending time on both financial planning and lifestyle planning, you can make it a time of meaning, personal fulfillment, and positive change.
