Our Life in the Middle Series addresses the philosophy at Sampson Investment Management that at all stages of life there is a middle ground that recognizes life is a gift that must be lived fully, yet responsibly. There are no guarantees in life, and an abundant life should not be deferred to some future date. Today, we address finding happiness in retirement.
Living life in the middle during retirement is dependent on the way life was lived prior to age 65.
Those who lived a life of balance during their working years are more likely to enter retirement with the financial resources, relationships with friends and family, and good health needed to be happy and successful during this period of life.
To put it bluntly, the quality of life in retirement is highly correlated with the life-balance achieved prior to retirement.
Those who begin retirement without balance are going to have more difficulty adjusting to this new stage of life.
Those who are out of balance financially, will need to make immediate changes in their lifestyle to live another 20-30 years without running out of money.
As financial planners, we encourage those approaching retirement to take no more than a 4% annual draw from their financial resources. If this sum, along with other retirement resources such as Social Security does not provide enough for a comfortable retirement income, then lifestyle changes must be made.
In “the new normal,” many people life up to a third of their life in retirement. Without adequate financial resources you may be faced with making some changes to your current lifestyle.
This might mean downsizing of a home, a move to a more affordable community, or consideration of a retirement strategy such as a reverse mortgage. Continuing to work, at least on a part time basis, also provides sense of purpose which can enhance the quality of life as people age.
Living A Healthy Life
Those who have built healthy life habits and exercise into their lives during their working years are more likely to live out long, happy and healthy lives in retirement.
We have all known 65 year olds who look and act like they are 40. This does not happen by luck. It is almost always the result of including good eating habits and exercise, meaningful work and solid relationships into a balanced life.
Similarly we all know 65 year olds who look and act like they are 80. This is usually the result of an unbalanced life that did not leave time for healthy living habits.
Once again, a life lived in the middle, wins the game in the long run.
Finally, social relationships become even more critical to life success as people enter the retirement years.
Those whose lives have been defined by one dimension, such as work, often face depression as they enter retirement because they didn’t have the balance during their working years that allowed for the development of relationships with family and friends.
If we were to zero-in on the most important predictor of happiness for a person entering retirement, it would be the quality and quantity of his or her social relationships.
We all know that such relationships are usually built over a lifetime. In a life lived in the middle, time has been taken along the way to develop and strengthen such relationships so they are there when most needed. Of course, it is never too late to make room for people in our lives, but it becomes more difficult if it is deferred to retirement.
Finding Happiness in Retirement
As we have seen throughout this series of blogs, “living life in the middle” is a habit that we should continue to practice throughout our lives. It requires planning and should begin with “the end in mind” to allow maximium success of our plans over the course of life. It recognizes that balance, which allows time for all of the important things in life, gives the best chance for financial security, good health, and rich relationships throughout life.
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