The Importance of a Retirement Plan
30 May 2022.
Here at Longevity, we value plans and not just retirement plans. Why? Plans that get you to retirement. Plans on when to retire. Plans after you retire. Because when you have a plan, you can make informed decisions and act, not react, to situations that can arise. But, just like your life, not every plan is financially based (retirement plans are important and should include things like your Old Age Security, Canada Pension Plan, and any defined contribution plans to understand your retirement income). To make the most out of your post-work life, it’s best to have some form of a game plan as to what that life will look like – consider Tom Brady.
On February 1st, 7x Super Bowl champion Tom Brady announced his retirement after 21 seasons… only to announce his return on March 13th, 41 days later! How brief was it? To put it into perspective, let’s look at a few things that lasted longer than Brady’s retirement:
Not having a retirement plan for how you will spend your days is a mistake many make. A 2012 study in the peer-reviewed Journal of Happiness Studies by Elizabeth Mokyr Horner, PhD, of the University of California, Berkley, found that retirees can experience a “sugar rush” of life satisfaction directly after retirement, but a sharp decline in happiness soon follows this feeling a few years later.*
While you anticipate retirement for a large part of your working life, it can be challenging to adjust to a new life free of structure. And that’s completely understandable. You worked hard your whole life, but you always had responsibilities that dictated your days to an extent – be it your career, dependents, or both.
According to a Skipton Building Society study, the most common reason for boredom in retirement is that people miss the camaraderie that comes with working and the second most common reason is that retirees feel like their days have become repetitive.** It turns out that work wasn’t all that bad. Its structure didn’t just give you a reason to get out of bed every morning; it also shoehorned in some variety into your day for however long your workday was!
Now, is that to say you should find a part-time job? It neither is, nor it isn’t – that’s only a question you can answer for yourself (ideally with your financial advisor when creating your financial retirement plan). What it is saying is that you would best be served in finding activities to fill up what was once your workday.
So, let’s look at a few ways you can spend your days in retirement.
Join Social Organizations
Suppose most people feel bored in retirement because they miss their camaraderie at work. So why not look to duplicate that camaraderie without, you know, actually having to go to work? One of the most challenging aspects of transitioning to retirement is coming to terms with our changing social circumstances. There are many meet-up groups that are geared to a variety of interests like books, chess, or outdoors activities like hiking – you’re sure to find one that lines up with your own interests!
Don’t believe the lies, it is absolutely possible to stay in shape past your 60s. Easy? That’s more subjective, but fitness is never meant to be easy, no matter your age. For some, it may get easier the more you do it; for others, it may always be challenging. But consider your quality of life if you ignore all physical activity. I can list all the health benefits of staying physically fit, but we all know there are many; however, another benefit from joining a fitness class is the social aspect and camaraderie you’ll find – see a pattern here?
I’m sure you’ve seen the numerous stories about someone in their 80s going back to school and finishing their degree or getting a new one. This is a great idea because learning has no age limits, but it doesn’t have to be in an academic setting like a university. You can join the MasterClass platform and learn directly from the most successful and experienced people in a variety of subjects. Take writing for example. Joyce Carol Oates, Aaron Sorkin, and James Patterson all teach writing, but in different styles – short stories, screenplays, and fiction, respectively. Who says you can’t become the next great author after you retire? Frank McCourt didn’t publish his first book, Angela’s Ashes, until he was 66 years old!
The Bottom Line
What you do in your post-work life is completely up to you! Maybe you’ll be happy sipping Mai Tais at the beach, maybe you’ll be happy hiking with a group of new friends, or maybe you’ll be happy finishing that degree that was put on hold because responsibilities came knocking at your door. The key is to find what makes you passionate and fill your days doing just that. Sure, much of society paints this picture of retirees just relaxing every single day, but that doesn’t mean you need to follow that picture. You may have retired, but your ambition surely has not! So, do what makes you happy, and remember a good social circle of friends, physical health, and intellectual stimulation will help anyone, retired or not!
*“Subjective Well-Being and Retirement: Analysis and Policy Recommendations,” Journal of Happiness Studies: https://doi.org/10.1007/s10902-012-9399-2
**“Skipton Building Society Retirement Index,” Ipsos: https://www.ipsos.com/en-uk/skipton-building-society-retirement-index
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