July 17, 2022

I Want To Retire Someday: How Do I Get Ready?


Just in case the post, Twenty Years On My View of Retirement, caused you to think this retirement stuff sounds pretty good. I felt it important to help you prepare.

What if you eventually want to retire, just not now? You are not there yet. Maybe it is a savings and money issue. Perhaps you enjoy your job and the stimulation it gives you. Maybe your responsibilities with your family must be front and center for now. Maybe retirement scares you a bit.

That just makes you normal. For whatever reason, you want to remain in the workforce but would like some suggestions on preparing for the day when you are ready.

Here are some essential concerns:

A) Make Your Financial Projections: Get a paper and pencil, a spreadsheet program on your computer, or anything that will help you with the following:

What is your projected income from now until you retire? Obviously, this is a guess. Your job might disappear tomorrow. But, based on your past situation, you should be able to make an educated guess of what you expect to make from now until you do quit. 
    What do you expect to receive from Social Security? Avoid the "it won't be there for me" panic attack. We don't know the future, but we know the present.

    If Social Security undergoes revisions, those changs won't take effect immediately; they will be sometime in the future. The political cost of not protecting this vital part of our social fabric will not allow it to go away.

    So, for now, use what is real today. You get a yearly report that tells you what you can expect based on your past earnings.

    Do you think you will have to take your payments as early as allowed, or will you be able to wait? There are logical reasons for both courses of action based on your status. Add that monthly amount to your projections.

    What is the current status of your retirement savings and investments? You can't predict what the market will do; just look at the last several months! In fact, don't look at all unless you have a strong stomach.

    You can project how much you plan on saving and investing in the years ahead. Using a conservative growth projection, what should you have when you are ready to retire? What do you need to have available when you retire?
      Here's a biggie: what about health care costs? None of us knows what the future holds in this area. Personally, the only thing I expect is prices to keep on rising, deductibles and copays to increase, and coverage to get skimpier.

      Plan on an increase yearly until you are eligible for Medicare or an Advantage plan. Even after you turn 65, the average American still spends $250,000 on medical care. 

      OK, now with those figures available to you, can you live on that for 30 years? People in good health today who are in their 40s or 50s can expect to live into their late 80s or mid-90s. If you retire around 65, you may have to take care of yourself for another 20-25 years. Can you?

      B) Make Your Lifestyle projections: Your financial situation will determine the overall life structure you will lead in retirement. Lifestyle issues will determine the quality: whether it is enjoyable and satisfying. Are you ready?

      Where will you live? Many folks want to escape weather they don't like and use retirement as the motivation to move somewhere more to their liking. Or, their family lives elsewhere in the country, and moving closer would make them happier.
        Others like the roots they have established where they are, have family and friends nearby and don't want to go anywhere. Moving to a retirement community on the other side of the country would never cross their mind. Aging in place is the plan.
          Do you envision yourself in an "active adult" community, an age-restricted setup, an urban or rural environment, or selling everything and becoming a nomad in an RV?
            What about the complications that arise when spouses are with each other 24/7? Trust me, this is a significant adjustment for both partners. No matter how many books on relationship building you've checked out of the library and how much you love your partner, being together all the time is tough without some planning.
              Do you have something besides work that you love to do? If work is your vocation and avocation, what will you do when you don't have that anymore? Do you have any interests, passions, or hobbies you'd love to explore? It is best to figure that out before you walk in the door of your house, retired, with no idea what to do next.

              Many times in multiple posts, I've made the point that retirement is a huge adjustment for anyone. I don't care how well prepared you think you are. There are things you have not foreseen that will happen. Such uncertainty shouldn't freeze you in place. Life is all about change. There is no way to cover all your bases ahead of time.

              So, what to do? Plan, plan, plan. Then plan some more. Consider everything you know and things you know you don't know. Then, when the time is right for you, just do it. Be ready to throw out all or part of your planning, though. Life will evolve in ways you never had projected.

              Do not insist on rigidly sticking to what you thought would happen. You will learn to adjust. You will struggle, grow, panic, and thrive. That is life whether you are retired or not. Even the struggles and disappointments come with their own life lessons.

              And, as I begin my 22nd year, I can vouch for the satisfaction that comes from having your time and your life under your control.


              1. Yes yes yes and yes. 🙃🙃 Advice to the worried: for the next 1-2 years, live on half your current take-home income as a test. Am I happy? Can I afford to have what is important to me (travel, meals in/out, car plus living expenses)? Do I enjoy my non-work hours/life? Can I do those things 24/7 (or simply sit still for awhile)?

                One of my surgeons retired last September. By March he was back at it full time. He has plenty of hobbies/interests and $ to travel the world, but he NEEDS the work!

                No one around me thought I would be happy retiring at 58 and were certain I would be back in the OR in 6 months. Fooled them! I love my life.

                Retiree......know thyself.

                1. Know thyself is the essence of being able to make the move to retirement successfully.

                  Then, I will add allow (and welcome) what you "know" to change and evolve, because it will.

              2. I love the saying "People plan, God laughs". I am a planner to my soul, but I expect my plans never to happen exactly as planned. Making adjustments, or you might say, going with the flow, is a natural part of the process. I have been a spend thrift all my life, so nothing changed in my retirement. In fact, sometimes I worry that I am not spending enough.

                I am currently starting a new special series at RJsCorner entitled "Rules for a better life" based on books by Bertrand Russell. Most of what he says is equally, and maybe, more important to us in our retirement years.

                1. I just read your latest post and noticed the similarities in our thoughts. Mr. Russell says it well.

                2. It's amazing to me that most of the words he wrote were written almost a hundred years ago. It just seems that they were written for our times in the 21st century.

              3. What's happened to all of us in the past two years is proof enough that we can't plan everything the way we want it. But thinking through the things you've mentioned and knowing yourself can go a long way to making a happy retirement.

                1. Covid certainly proved the point that there is nothing permanent in planning. Plus, a rigìd approach means missed oppoŕtunities to learn and grow.

              4. No-one tells you how much you will miss work and the camaraderie of work. I loved my job as a graphic designer for a text book company. And I miss all my artsy designer friends from work. Yes, I go into my studio all day every day and paint. Without it I would be quite lost. But I miss the office and all that entails.

                1. Can you contract work for them and have them 1099 you? Do a week a month? I know nothing about that line of work but it strikes me as possible?

                2. Missing the work environment and the people you spent your days with is completely understandable. As Elle suggests. Is there a way to meet with some of your co-workers on occasion for a simple socil gathering? Even an occasional Zoom get-together might be enjoyable.

                3. I could not contract with them since the software has really evolved and I have not kept up. I am hoping that when we move back to Massachusetts I will see people again. Being so far away from friends and family has been horrible. Thanks for listening and responding.....Best, Roberta

              5. My sister happens to be visiting so I asked her if there is anything she would change about her first 8 years of retirement (other than the fact that her husband died when she was 57). She said no. What has she done? The first summer when her grandchildren were still grade school age, she rented an RV and took a West US road trip with them and her son. Excepting Covid restriction/health safety concerns, she has taken 4 major travel trips of 3-4 weeks outside the US each year. She moved into a small single level home that she loves 99.% of the year, meaning she can no longer have 40 people over for celebrations.

                Her home is in an over 55 community. Her observations are that once the neighbors reach 80, more than 90% of them exhibit physical ability decline and cease travel unless their children or adult grandchildren take them. I saw that with my Mom. After 75, she would call one of us and say "you're in charge of me 'this trip'. We would buy the plane ticket, book her hotel and ride with "you" (she insisted on paying her own way). Her last driving trip was also before she was 80.

                I thought I would offer a single female retiree's experience to this conversation. :-)

                1. I appreciate this, Elle. Your sister's perspective on age and stages of retirement is right in line with what others have told me.

                  I imagine the RV trip with her grandkids was a tremendous memory-maker for them all.