The March 2010 issue of Consumer Reports Money Adviser has an interesting article on how to avoid regrets during retirement. The article, which draws on a survey of nearly 25,000 subscribers, is simultaneously comforting and cautionary. While only about 20% of folks who haven’t yet retired are highly satisfied with their current retirement planning, 70% of actual retirees report they’re highly satisfied. According to the author, the lesson is:
While many of us tend to fret about whether we’re properly prepared for retirement, once we’re actually there we tend to adjust our situation and even thrive.
In fact, the author argues that the survey reveals money isn’t everything. Sure, it plays a large role in contentment during retirement, but other factors matter, too. The article says that to be satisfied in retirement you need to:
- Save early. Forty percent of retired respondents wish they’d started saving earlier. I know I say this over and over again, but you should save as much as you can as soon as you can. Even starting with $10 a month is better than nothing.
- Save often. As important as it is to save early, it’s also important to save often. In other words, save as much as you can afford to. You don’t want to live like a pauper now so that you can live like a king in retirement, but don’t sacrifice your future for unnecessary spending today. Do what you can to boost your saving rate as time goes on. (My wife saves over 25% of her income!)
- Stay healthy. Your health is your most important asset. Without it, you’ve got nothing. And health is so easy to take for granted when you’re younger. I’m just now entering middle age (I’ll be 41 next month), but I’ve been a fool and neglected my health, so I’m beginning to see the mental and financial costs associated with being overweight and out of shape. (Just this morning I took a tumble on my bike that might not have happened if I were 40 or 50 pounds lighter.) Adopt healthy habits, and they’ll repay you in the long term.
- Build friendships. Social capital — those connections we build when we spend time with neighbors, friends, and family — is almost more important than financial capital. Your relationships play a larger role in your happiness than your wealth does. Be positive, outgoing, and an active member of your community.
- Have hobbies. Finally, the Money Adviser article recommends actively pursuing hobbies and interests that keep you engaged with life. Share your hobbies with others. And if you don’t have hobbies, get involved with volunteer and community organizations.
As I wrote Your Money: The Missing Manual over the past few months, I tried to target the J.D. of 20 years ago: the spendthrift and layabout. My goal was to write the book I wish I’d had when I was 20. This process made me think about what I ought to know now. What will my 60-year-old self wish he’d known when he was 40? As a result, I’ve started paying attention to retirement articles like this one. I’m doing my best to glean hints and tips from folks who are already in retirement so that I won’t be caught unaware.
Most of what I’ve learned matches this article: To be happy in retirement, I need to save, I need to be active and eat right, I need to have close friends, and I need to do things I enjoy. In other words, to be happy at sixty, I need to do the same things that make me happy at forty.
I’d love to hear from GRS readers who are at or near retirement: What do you wish you’d known when you were younger. And those of you who are still decades away from retiring, what have you gleaned from those around you? What leads to a happy, healthy retirement?
This article is about Planning, Retirement
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I agree with Tyler K. – shoot for super-low income needs (i.e. low fixed expenses) and the rate of return becomes much less of a concern.
Also agree with Zumba – don’t get bored!
My “plan” is to live cheaply (small, energy-efficient place with a garden) in a community full of younger people who I can adopt, since I don’t expect to have family to look after me when I’m old.
As to health … the thing Americans are WORST at … my plan is to continue daily yoga, balanced nutrition, dancing and more dancing, a glass of wine every night and green tea every morning, and to stay away from doctors who’ll try to put me on (expensive, for-the-rest-of-your-life) meds for conditions that are a natural consequence of aging.
All that said, I have been involved in company 401(k) plans for twenty years and also am fully funding my HSA. You have to cover all your bases – social/emotional, physical, and financial.
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I read the follow up to Your Money or Your Life (I can’t remember what it is called – it’s about the people that actually went through with the plan). Some of them seemed happy, some were still trying to figure out what to do, or were a little confused with how to handle that their days were so different, etc. It was just like retirement for others, it wasn’t a guaranteed happiness. Just validates what this article says.
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I think it is much simpler than that. Being able to pay expenses out of your assets for the rest of your life is a given. Beyond that one simply needs to find something that will take the place of the one’s previous job. This is a common challenge especially for those who focused everything on their career and don’t know or do much of anything else. It is also a challenge for anyone who got their day structured by their job and anyone who gets all their social interaction via the job. They are starting from scratch. Health and all that is nice to, but that pertains to workers as well.
Another thing to keep in mind is that in retirement it is hard to blame one’s job for not being content or happy. A that point it is all on the retiree.
Also what #48 said. I’m 34 and share the sentiment.
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My late husband and I began full-time RVing at age 47. We couldn’t retire so ended up working as seasonal workers for the National Park Service. Because our living expenses were so much lower, we saved one salary and lived on the other.
There are still major expenses like repairs living the RV lifestyle, but it does satisfy many of the elements you mentioned. We have many RV friends and plenty of free and low-cost recreation living this lifestyle. There are many opportunities for work and volunteer that is as active or laid back as desired; much of it fun and leading to adventures you’d never have in a stix ‘n brix life.
Jaimie Hall Bruzenak
author of Support Your RV Lifestyle! An Insider’s Guide to Working on the Road
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I am 54 years old and suffering from a heart condition, I used to joke that my retirement plan was to “die young” i may get my wish. My suggestion is get out and enjoy life to its fullest, I had a job i really enjoyed and planned to work well into my retirement years,plans change. Don’t worry so much about tomorrow live for today. tomorrow is not guarenteed.
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Poster #6 – frugal scholar
I have worked for a non-profit health organization for over 20 years and what you said is an insult. It’s nice that you can teach poetry and the arts are important. However, with a government that is more focused on spending money in a pork barrel type fashion, it is up to organizations like ours and many others to provide life saving research and programs to millions of people in this country. Our work has saved millions of lives, and it would not have been possible without the hard work of our volunteers, so please do not denigrate the work of non profit. With an attitude like yours, please continue to teach your poetry, which is so much more important than saving lives – I don’t want you as a volunteer. The ones I work with are a hundred times a better person than you seem to be. And I beg to differ – anyone can be educated and work at a job – it takes a special someone to be a volunteer.
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I am of the flock of people who doesn’t believe in the whole ‘retirement’ thing. The idea of retirement seems to have been made up by the 20-30 something crowd so the older, wiser and more experienced crowd wouldn’t cramp their style.
I’m fortunate. I love what I do for a living. My husband and I work from home, we have a flexible schedule, take breaks to go hiking in the middle of the day, take a day trip to the lake, go the matinee with friends, read till 10am on a weekday, etc..
And when we work (we make films and build websites) we get the chance to be creative, work with interesting people and travel to cool places.
And we’ve recently added a deepened spiritual practice to our routine. Now it has richness that was missing before – we’re happier than we ever were. I recently read a wonderful book by Andy Feld called, “Wake Up! Your Life is Calling.” The author and his wife live a similar lifestyle to mine and my husband’s- and after we read his book we started to work together and become friends.
In his book, Andy talks about an inward practice (meditation or contemplation) to help gain answers or just as a way relieve stress and worry. Once those negative feelings begin to disappear from your life, why would you want to retire? Retirement to me means sitting out, not participating in something meaningful.
Backgammon and golf and going to the movies with friends are great, but add a career that I love to the mix and I am truly a happy camper.
thanks for listening,
Kim
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Happiness in retirement has a great deal to do with simplicity and financial security and I do not mean large wealth. Setting a goal earlier in life to have an automobile paid off, perhaps a house paid off, and no credit card debt will create a fiancial peace of mind thereby freeing the inner spirit to flourish. When our basic needs of shelter and food are in question it becomes very difficult to work on the joys of inner spiritual growth and love. Hopefully the lessons of large personal debt and overt materialism are finally being learned. Thanks again Andy
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The questions I keep running into regarding approaching retirement are related to how couples issues play out, especially for couples who are different ages. I’m within a decade of retirement and my husband will be retiring sooner. Some of my acquaintances think I’m retired already as I only work about 25 hours a week. And while this certainly gives me more time and less stress than full time work, it doesn’t give the same freedom that being retired does.
I expect my husband and me to have some renegotiation of money, housekeeping, and other issues when we retire. For instance, my husband has lower standards as to what makes a clean house etc. Right now, I take the lead on these issues. How will that play when he’s home more than me?
I’m used to some time to myself in the afternoons. How will it go when we are both home full time? We enjoy each other’s company but will we get on each other’s nerves with more togetherness? I’d like to cook more and experiment with food. My husband isn’t very interested in trying new foods. Also we both have ideas on how to save money – but they are different things. I could cut out cable TV but my husband really enjoys some programs that are only available on cable. He’d like to get more channels. On the other hand, he thinks we could get all of our book from the library but sometimes I like to have my own copy.
I expect to figure these things out but am interested in how other people handle them and how they affect their happiness in retirement.
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Hi, Read your article. Much to be said about being prepared for retirement. It is great being retired but not if you have to change your lifestyle.
I would like to hear more about working part time (seasonal) for the national park service. In my travel a number of years ago, I encountered this wonderful couple who would work at a park. She worked in the gift shop and her husband help with outside work. Would you be able to give me an address where I can get this information and what is available?
Appreciate your feedback LC
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