For most responsible adults, doing everything right to prepare for retirement means settling into a delayed gratification mindset for the long haul. You dutifully shovel income into a 401k, Roth, HSA and maybe even a brokerage account. And you don’t touch any of it. That money is for future you. You’re conditioned to save for later. But what happens when it’s finally time to spend what you’ve spent so many years (decades!) growing? Many people have trouble with that transition… and not because they don’t have enough. Our experts share their insights on how to flow with positivity and joy into that next phase of life, starting now. You might be surprised how much of their perspective centers on mindset shifts versus hard-and-fast financial “rules.”
Flexibility wins in a world of uncertainty
Many of us have been planning for retirement since our 20s. As the decades stack up, that picture of retirement changes. And it will continue to shift and morph into a new ideal with every passing year. “We really focus on setting the table for our clients that their picture of retirement may be different now than it will be when they actually retire,” explains VP, Senior Wealth Strategist, Stephanie Hannan. “So we talk about planning for what you absolutely know, which is your living expenses, then planning for hypotheticals and finally planning for wish lists.” From there, Hannan and her team match those goals up to financial realities.
“When you don’t know exactly what retirement will look like, you’re really planning for options,” says Hannan. Of course, that doesn’t mean you shouldn’t have a plan.
“The best plan is to have something in place and understand that you need some level of flexibility to account for life and how it may end up looking a little differently than what you might plan,” says Dr. Gilbert Rogers, Vice President of Financial Education. “The earlier you can start working with a professional, someone who can help you build out a plan with different scenarios, you’ll develop that necessary flexibility,” he explains.
Once your financial advisor understands the potential ways your retirement could unfold, they can use sophisticated software to run the numbers for different if/then scenarios. Predictive models based on market data help paint a realistic picture of what your finances will look like when you’re ready to retire. Then you’ll understand all the options, and feel more comfortable welcoming change as it comes. “It’s really kind of backing into the numbers based on expectations, rather than figuring the numbers out first,” explains Hannan.
Self-reflection is the most underrated (and free) tool for reaching retirement nirvana
If you’re thinking something like, “Well heck, I have no idea what I want my life to be like when I retire,” you’re in good company. “Some people don’t even realize that their work has become their persona,” observes Hannan. So it may be worth asking now: who will you be when you are no longer working? For one executive client of Hannan’s, there’s a big change coming in retirement. “This individual is a C-suite executive looking to transition into retirement within the next three to seven years. And one of the conversations we had was really seeing and getting to the core of the human. Because while this person has an impressive executive presence, the true desire is to be much more reclusive and in a very simple lifestyle,” shares Hannan. Currently, the exec spends a hefty amount on professional wardrobe and memberships, even salon and aesthetician services. In retirement, that spend will decrease dramatically to match the less visible lifestyle this person craves. That downshift in public persona will be reflected in their projected budget.
On the flip side, you can absolutely plan to pay membership dues to clubs or societies that are vital to the thriving social life you might envision for your later years. There are no wrong answers, only thoughtful decisions that help you write your own happy last chapters.
Going for “directionally accurate” sets you down the right path, even if it’s full of twists and turns
Don’t have it all figured out? That’s completely normal, reassures Hannan. “With our clients, we really like to allow for changes and modifications, making sure we’re guiding clients that it doesn’t have to be precise. We often say let’s aim for directionally accurate,” she explains. “It’s a continuum, and the goal is to keep going in the right direction. As you age, that vision can narrow. People may come into your life, such as children or grandchildren. Maybe that alters what your ultimate retirement destination looks like,” explains Hannan.
“You never know exactly what retirement will look like,” agrees Dr. Rogers. “And there are so many outside factors beyond your control that can impact your ability to reach your initial goals. It’s everything from health and family dynamics, to your overall situation changing as far as your caregiving responsibilities.”
It also pays to be clear-eyed about your current spending. “Some people have no idea how much they spend,” Hannan reveals. “And that becomes the most challenging part of the discussion. The income is pretty easy. You can figure that out and you can manipulate the amount that you’re taking,” she explains. But without an accurate picture of overall spending, your retirement plan may fall short.
Trade-offs are essential, but they may come with guilt
In retirement, what you say no to is equally as important as what gets the spending green light. “You have to set realistic boundaries around your goals and achieving them, or maintaining the lifestyle you want in retirement,” suggests Dr. Rogers. “To do that, what are you saying no to?” he asks.
Before retirement, maybe you purchased cars for children and even paid for repairs. If that will shift to be the children’s responsibility because it doesn’t fit your retirement budget, you need to be firm about where you will and won’t foot the bill. “If you always took care of whatever your kids need, and now you can’t provide as much as you would like because of your retirement situation, that can come with some guilt,” observes Dr. Rogers.
Sometimes trade-offs bring guilt in other ways. “Let’s say you’re retiring, you’ve saved, you can retire, you can travel and dine out, do all these things. And maybe the couple that you and your spouse have been doing everything with all along cannot retire and cannot do those things. So you’re feeling a bit guilty over doing things because you don’t want to make someone else you love and care about feel badly,” says Hannan. “You have to think about how you navigate that guilt, and how you maintain those relationships without looking like you’re flaunting retirement.”
Being honest with yourself and setting clear expectations with friends and family can help you focus on enjoying your retirement and growing even stronger relationships throughout your final chapter.
Conclusion: Finding your unique joy in retirement is the real story
“At the end of the day, you have to answer the question: what’s going to make you happy?,” says Dr. Rogers. It could be donating to a cause you believe in, having meaningful experiences or leaving a legacy. There are no crystal balls, so there’s no way to know what life may bring. “You may lose a loved one, but looking for joy, I think that’s something you continually seek, to find a way to achieve it,” says Dr. Rogers. “One thing I think about, that gets into some of the research behind how you can use money to make yourself happy or create happiness for your family, is really having a thoughtful purpose for your money.” For some, it might be a visible accomplishment like having a building named for you. Or perhaps it’s just knowing you’ve set your family up for future financial success once you’re gone.
It’s tempting to think there’s a set number or a clear path for what retirement should be, and for knowing when you’ve “made it.” But the truth is much more complicated, and it looks different for every person. There are no right or wrong answers… just the ever-changing path meeting your footsteps as they fall. That’s why financial flexibility is the real secret to finding retirement joy.
