June 12, 2015 — Oh, the things we say we are going to do in retirement. And if only we did them! We were inspired by a recent MarketWatch story, “Five Lies We Tell Ourselves in Retirement“, which focused on lies people tell themselves on financially related aspects of retirement. We liked the idea enough we decided to create our own list of lies, but with a different focus – (mostly) non-financial fibs. This is our list – we encourage you to add your own in the Comments section below!
First, we give you the list of retirement related lies that we think get told the most. It could be argued some of these are just retirement mistakes, while others are overly optimistic expectations. Unfortunately the outcome is often the same. In the second part we will explain why, unfortunately, these things are so often not true. The point of this article isn’t to point fingers or make ourselves feel bad about our failings, rather it is to try to prepare against unrealistic expectations.
Some common retirement lies we make
– Will retire at age 70 (or fill in an age) so I have enough time to plan and save
– Will never retire
– Will get a part-time job
– Will somehow get enough money to retire on comfortably
– Will take out money on an even enough schedule to make it last
– Will travel a lot
– Stay in my current home until they carry me out
– Will live in one place the rest of my life
– Will get physically fit and live a healthy lifestyle
– Carefully research a great place to retire and then move there
– Won’t have any trouble figuring out how to keep busy
– Continue to see my old friends from work
And here is what happens more oftten than not:
Will retire at age 70 (or fill in an age)
The truth is when we actually retire is often quite unpredictable. Far too many baby boomers have found themselves unexpectedly retired in their early 50s, years before they wanted to. Sometimes they got laid off, other times it was a health issue. The point is to be prepared if your plan goes awry.
Will never retire
This stretcher is related to the one above. Layoffs and/or health issues can change plans quickly. But sometimes we realize the job just isn’t fun anymore, or we can’t do it as well as we expect. If you love what you are doing – keep doing it! But be realistic and open to changing circumstances.
Will get a part-time job
A surprisingly high number of boomers say they are going to get a part-time job when they retire – either to help make ends meet, or to stay busy (both good reasons!). But the reality is different for many folks. If you move to an area where unemployment is high or the only part time jobs are not very desirable or physically demanding, that might be tough. Likewise if you have health issues or need to take care of a spouse of family memmber, you might not have time.
Will somehow get enough money to retire on comfortably
This is one of the more serious delusions we can make for ourselves. If before you retire you haven’t figured out what your living expenses are going to be in retirement, and if you have enough resources to pay those, you are officially in trouble. The money is not magically going to appear once you quit working. You need to go to Plan B immediately. Delay retirement, save more, cut your expenses, downsize your home, get a job – you need to do all or most of these so you do not jeopardize your lifestyle.
Will take out money on an even enough schedule to make it last
Even if you do have enough money for a comfortable retirement it won’t last if you aren’t disciplined about how you withdraw it. It might be tempting to spend lavishly on a new home, trips, or luxury items with your now accessible retirement savings – but restrain yourself. We have met too many financial advisors who see clients taking money out too soon, knowing that a day of reckoning is out there. Likewise many boomers rationalize that they can spend more when they are young retirees because they will won’t have such ambitious dreams as they age. The downsize to this approach is that old age has its own expenses. We will get old and sick someday – if we are lucky! Nursing homes and CCRCCs can easily cost $7000/month. Expensive operations, rehabs, and home health care can burn up even more. Steady as she goes is our recommended approach.
Will travel a lot
We hear this a lot, particularly from folks who haven’t done a lot of retirement planning. Sure, we’ll travel. And most people do travel – a little bit, and for a while. Don’t plan on travel to fill out your days, unless you are a very adventurous, planning kind of person. Start with a Bucket List and see how it goes. If you like travel, keep at it and have fun. It does get harder, but not impossible, as you age.
Stay in my current home until I die
Long time visitors to Topretirements know this one of our pet peeves. Sometimes it becomes impossible, expensive, and socially a bad idea to stay in your current home. It can also put a terrible burden on your family members. Sure, it can be wonderful for some people who have the resources, family and social networks, and good health to pull it off. Others will have no choice, as health issues or disabilities force them from homes ill-designed for that situation. In our opinion it is better to have a flexible rather than a hard-headed approach on the topic. As your health and living skills decline, you, and your family members, might be better off in an independent living, assisted living, or CCRC kind of facility.
Will develop a healthy lifestyle
We hope all of our members are physically fit now or plan on getting that way as soon as they retire. The sad fact an increasing number of us are not. For the most part we will live longer and have fewer health issues if we adopt a healthy lifestyle – eating right, exercising, and moderation/abstinence from alcohol and tobacco. Our point: Don’t lie to yourself about getting healthy – develop a plan and a schedule to get there. Talking to your doctor, hiring a trainer, or going to classes on a regular basis is the best way to get on the road to success.
Carefully research a great place to retire and then move there
Certainly the approach that involves exploration, frequent visits, and renting first is the best advice. But a surprising number of people take the default approach. They visit a place once and buy. They go to where their friends live and buy there. They find a rental on the Internet, rent for a month – and never go anywhere else. So here’s our counter to this stretcher: the more places you visit and the longer you stay there the happier your eventual choice will probably be. It takes discipline, but it pays off with better odds of success.
Won’t have any trouble figuring out how to keep busy
If we were ranking these retirement lies in order of severity, this one is near the top. Like nearly everything else in life, having a thought out plan is the key to success. So here is the Topretirements lecture: Think about what you are going to do… before you retire. Prioritize on paper what you (and your significant other) like to do. Develop a hobby and a passion. Then think about places and developments where you can enjoy those activities. Visit those places and try stuff – it might take a while but you can enjoy the process!
Continue to see my old friends from work
Many people find seeing old friends an enjoyable part of retirement. Just realize it won’t happen unless you take the initiative and have a regular schedule for it.
Retirement is a chance to have a do-over on life. So try to be honest with yourself and realize where your good intentions either need a mid-course direction or a stern talking to!
Comments? Please share your experiences with the lies you told yourself about retirement. We can all learn together!