Retirement Planning – Where Do You Start?

If you were like me, I was not overwhelmed by the prospect of retirement. I retired and then I realized I had no plan and no idea of what I should do next. I was overwhelmed so we went away for 8 weeks to Australia to visit family and friends. While there I did not think about the fact I retired but I did start thinking about what I should do next. When I came back to Canada I realized that I had retired too soon and I missed work. I was lucky and was able to return to work and I worked part-time and full time for eight years before I decided in 2014 to retire full time. By that time I had another purpose and ideas about what I needed to do with my time. I still am doing it and enjoying the freedom I have to explore my writing, my workshops and my time with family and friends.

I realized that there are only two sides to retirement planning.

1) The financial side is established financial planning where you determine if you have enough money and where your income will come from each year for the rest of your life. I had done that before I retired so I was not worried nor am I worried about running out of money before I die.

2) I think the more important side of retirement is the personal/emotional side is where you answer the question: What do I want to do with the rest of my life? 

If you think of money as a tool that should enable you to live the life you love, create memories you treasure, and build legacies that express your deepest values then money becomes not important once you know you have enough. The problem is most of us do not have a clear picture of what we really want. Find someone, who can guide you through life’s transitions and help you figure out how to live a retirement that will leave you without regrets, doing this can really help you make the transition into retirement.

Most of us as we think about retirement become very focused on traditional financial planning. To that end, we use various programs to determine the likelihood of us outliving our money. The output of this planning will only be as good as the data you put into it. That’s called the “garbage in, garbage out” principle. Going through this process is important so you need to have  reasonably accurate numbers in the following areas:

Planned Spending:

• Core retirement living expenses – How much you plan to spend in after-tax dollars each month/year, and

• Large infrequent expenses – This includes items such as cars (if you pay cash), home remodelling/updating, etc.

• One-time expenses – a child’s wedding, vacation home purchase.

• Also factor in whether or not you have expenses that end during retirement (e.g., mortgage)?

• Financial assets – You will need a list of all your accounts (e.g., TFSA and RRSP, or for my American friends their 401k, IRAs, cash in the bank, real estate) and all your liabilities (mortgages, car loans, consumer loans, etc. 

You should also understand your risk tolerance, preferences, and past experiences with money. It is impossible to know exactly how much you will spend five or ten years from now. Don’t worry. Your initial plan is not going to be perfect. The goal is to forecast as close as reasonably possible and then update the plan based on actual spending and actual investment returns. Financial planning is not a one-time project but an ongoing process, kind of like landscaping (but less painful).

In a future post, I will talk about why we do what we do reveals what is in our hearts, and that is where true motivation and fulfillment lie and why that is important for retirement planning.

Life can change in a moment:

I was talking to a retired lawyer at a workshop and he was telling me his life story and he casually mentioned that he had survived a fire and that as a result of that fire, he had burns over 40% of his body. He went on to explain that the hardest part of his recovery was how to regain the use of his hands. Those of you who have followed me for years know that in 2014 my wife had a brain aneurysm and that at that moment I realized how life can change so quickly. The lawyer I talked to had a life-changing moment and was able to talk about it without being bitter.

I had experienced transitions when I retired and over my career,  I had brought about some major changes and I thought I had embraced the concept that change seems to be the only thing that is inevitable. But until you face life-changing issues or death the concept of change is abstract. Some events are planned while others come out of nowhere and smack us in the head. I know that lives can change at a moment’s notice. Yet nothing can prepare you for a fire, a car accident, or a catastrophic medical event. 

How well we respond to the events is I think one of the chief determinants of how well you savour life. In my life and in the retired lawyer's life the events we experienced made us stronger not more fearful. We both were very lucky as we had a wealth of people who would and did support us in our time of need. Not everyone has this luxury of a strong support group and have to face new and sometimes terrifying situations alone. My hope is that these unforeseen situations make you more effective not more afraid. More altruistic not more self-absorbed. More welcoming not more careful.

If a person does not have a strong support group then they need strong coping skills as they face the life-changing event and transition to the other side. It may be cliche to say but even after the most horrific tragedy life goes on and those who have the best coping skills, and are the most emotionally resilient, bounce back from disappointment or traumatic events and find new opportunities.  

Life is a range of transformations. We experience these changes in our careers, businesses, families, relationships, finances, and even our health. Each change requires us to go through a psychological process to come to terms with our new situation. According to William Bridges, the process of change and transition has three stages all require an emotional resiliency. The stages he uses are endings, the neutral zone, and new beginnings. 

If you are fortunate to know what changes you are up against then you can prepare for the change. If it is an unexpected change, such as a fire or a medical emergency then you cannot begin to prepare properly, but you can take steps to cope. Think of an upcoming life event including the unthinkable ones (death of a spouse, medical emergency, car accident, etc)  or one you are dealing with now. Write down every relevant question, concern, and possible consequence. You have to get them out of your head and on to paper. For example: What’s my greatest fear? What’s the potential financial impact? Where will the money come from? What resources or expertise could help me with this situation? Whom do I know who has been through this and what can I learn from that person?

The process of thinking through these questions will give you the confidence to respond when the time comes. Proactive thinking puts you in a different headspace even when the situation turns out far differently than what you anticipated.

Transitions

Let’s confront it head-on; retirement is a major life transformation, like going off to university, getting a partner for the first time, or going back to living without children in your home. Retirement may take a little time to get used to; it took me eight years. Create a plan, but don't worry if the plan will not be as you imagined. Based on my life experience and my experience in talking to others here are some suggestions for a steady transformation and a glorious retirement:

·   Required duties kill the spirit notwithstanding age. Don’t agonize about what you believe you should be doing or what others think you should be doing when you retire.  This is about you. It’s your time to do what you want.

·  Generate a daily plan. It may sound like a fabulous scheme to throw away your alarm clock and avoid any new responsibilities. A sudden lack of structure is and can be unsettling for many of us.  I stopped getting up at 6:30 over the first year of my retirement and now I get up closer to 8:30 but that was after 13 years of retirement.  We all need a reason to get up in the morning, so I recommend that you plan to be up by a certain time and have some activities scheduled for specific days each week.

·  Rekindle old friendships. If you can try and develop new friends hopefully in different age groups. I love to read and since I retired I have read hundreds of new books, and I love to putter around my house, I find it comfortable. At the same time, I volunteer, go out with my friends on a weekly basis because I know these activities dare more beneficial to my mental health. It is not easy making new friends when you retire, but one of the easiest ways to make new friends is through new activities such as sports, seminars, cooking classes, travel, hiking clubs, poker night, book clubs, yoga, wine tasting, etc.

·  Get professional help. It took me eight or so years to get used to retirement because I retired without a plan. I was, however, very lucky because I had friends I could talk to about goals and what to do with retirement. Some people may need professional help with this if so, I recommend that you get the help before retirement not after.  The folks who sit down and discuss/plan their post-retirement goals are the ones who typically have a more satisfied, fulfilling retirement.  This can especially be beneficial for married couples and can/should be done before you retire to get on the same page about expectations and concerns. Sometimes people who have retired without a plan may experience some of the following signs and symptoms, If you do experience some of these on a daily basis or for more than two weeks, you may be suffering from depression:

·         Persistent sad, anxious, or “empty” mood

·         Feelings of hopelessness, or pessimism

·         Irritability

·         Feelings of guilt, worthlessness, or helplessness

·         Loss of interest or pleasure in hobbies and           
           activities

·         Decreased energy or fatigue

·         Moving or talking more slowly

·         Feeling restless or having trouble sitting still

·         Difficulty concentrating, remembering, or making         decisions

·         Difficulty sleeping, early-morning awakening, or 
           oversleeping

·         Appetite and/or weight changes

·         Thoughts of death or suicide, or suicide attempts

·         Aches or pains, headaches, cramps, or digestive 
           problems without a clear physical cause and/or 
           that do not ease even with treatment.

Not everyone who is depressed experiences every symptom. Some people experience only a few symptoms while others may experience many. That is why it is important to not self diagnose and talk to your doctor.

Amazing Simple Home Remedies

Use with an abundance of caution.

1.          If you are choking on an ice cube, simply pour a cup of boiling water down your throat. PRESTO! The blockage will instantly remove itself.

2.          Avoid cutting yourself when slicing vegetables by getting someone else to hold the vegetables while you chop.

3.          Avoid arguments about the toilet seat...Use the sink.

4.          For high blood pressure sufferers--Simply cut yourself and bleed a few minutes, thus reducing the pressure on your veins. REMEMBER T0 USE A TIMER.

5.          A mouse trap placed on top of your alarm clock will prevent you from rolling over and going back to sleep after you hit the snooze button.

6.          If you have a bad cough, take a large dose of laxatives. Then you will be afraid to cough at all.

7.          You only need 2 tools in life........WD-40 and duct tape. If it doesn't move and should, use WD-40....if it moves and shouldn't, use the tape.

8.          Remember- Everyone seems normal until you get to know them.

9.          If you can't fix it with a hammer, you've got an electrical problem.

10.     Got a wart, use duct tape it is more effective in removing warts than getting treatment.

11.     Constipated try drinking dried Alvera leaves or just keeping yourself hydrated.

12.     Got obstructive sleep apnea, try playing the didgeridoo, it is a proven remedy for this problem.

AND A DAILY THOUGHT. some PEOPLE ARE LIKE Slinkys...NOT REALLY GOOD FOR ANYTHING, BUT THEY bring A SMILE TO YOUR FACE whenever PUSHED down the stairs. 

Source: http://www.jokesoftheday.net/joke-Home-Remedies/2014092440