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Field Work

Dreams of Retirement? Watch for Pitfalls

Early last year, a client who was a month away from retiring walked into Matthew Jackson’s office and asked him to manage his money. Then the client started pulling financial statements out of a folder and slid them across the desk.

“I’m excited for you,” Jackson recalled was his first reaction. “But let’s talk more about what you want to do with your money, rather than want you want to do for your money.”

The client “looked at me and then past me. In 4 or 5 seconds he said, ‘Matt I have no idea.’”

To prod others into weighing this critical question for themselves, Jackson wrote a book, “The Retirement Dreammaker: Master the Art of Retirement Abundance.”

And the dream maker is not Jackson – it’s you.

People facing impending retirement are about to hop on a wild ride that will take them from the emotional high of having the freedom to do whatever they like to an unfamiliar low: no job to give them purpose.  Because of that, Jackson is on a mission to warn baby boomers they need to really prepare emotionally for retirement, just as they should prepare financially. (A financial planner turned financial coach, Jackson’s new book also includes a financial chapter.)

“The ultimate freedom is the freedom to follow your purpose,” he said in an interview.

Jackson’s goal in trying to help people who don’t prepare emotionally is not simple but boils down to this: he does not “pump people up – rah-rah.” He prefers to warn of the six retirement pitfalls:

  • Lack of money. Granted, many retirees do, indeed, live on the edge financially.  But the feeling that they don’t have enough – whether or not they do – “paralyzes people,” he writes. The root cause is a consumer society bombarding us with one message: stuff equals happiness.
  • Lack of permission. Retirees who feel they don’t have enough money don’t give themselves the permission that is required to spend it in pursuit of a passion.
  • book coverHealth. When healthy baby boomers picture retirement, they don’t see the failing health that could spoil their paradise.  “So why do we live in such a state of denial?” Jackson asks. It’s important when planning retirement to consider the consequences of failing health – and then hope for good health.
  • Isolation. Puttering around the house sounds great for workers with little time for themselves. In retirement, loneliness becomes a risk, as friends move away, as it becomes increasingly difficult to remember to hear conversation in social gatherings, and as grief or physical limitations strike. Isolation and loneliness do damage, research shows, including increasing the risk of dementia. So find ways to stay engaged.
  • Waiting for milestones. In life, we lurch from big event – graduation, new car, new house – to big event – first Social Security check, dream house, grandchildren.  Unfortunately, divorce, ill health, and death are aging milestones too, Jackson writes. Take that trip, follow that passion, find that soul mate now!
  • I’m old and irrelevant. Low self-esteem is a retirement affliction among people who give up their careers and then find that it’s difficult to land  something fulfilling to occupy them.  A related feeling is irrelevance – an example is older people not keeping up with technology.

Stay relevant by finding your purpose, Jackson advises. This is where the hard work begins.

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6 Responses to Dreams of Retirement? Watch for Pitfalls

  1. Brian says:

    It pays to plan for retirement years before the actual date. Whether you manage your own money or have someone else do it, it’s important to fully understood your lifestyle, health, spending patterns (we’re all creatures of habit), hobbies, extracurricular activities, passions, and both regular fixed and variable expenses.

    As for those six retirement pitfalls, they should be resolved well before retirement. Waiting until a month away from retirement is way too late.

  2. Ellen Switkes says:

    Financial planning is only a small part of preparing for retirement. There are 16 waking hours in a day. Planning on how to fill them in retirement is a major issue now that you no longer have a regular job. If you can afford to retire, consider taking volunteer position or low paying position in a non-profit as a nice transition from full time work.

  3. PJ says:

    My low paying position in a nursing home is only two days a week. Somehow in my make up I need to earn something, but this job gives me back way more than money (think Roth) and I look forward to going to “work” and have social contacts there. I find myself considering what I can do to improve something when I am at home. Also learning about end of life issues is a real revelation. Hopefully if I end up living in a nursing home I can be a positive person/patient.

    Retirement is wonderful with a flexible plan and some health luck and maintenance (think dentist, optometrist, exercise, etc.)

  4. Carol Urling says:

    I am 71 and finally decided to pull the plug and semi-retire June 30, 2018. Part of delaying so long was “what will I do” to fill the time as I have been a workaholic all my life. I work with a number of non-profits who are always looking for volunteers so I have selected a couple to work with. I will also continue some part-time work at least another year after that (I am a contract CFO). I am fortunate to be in excellent health. I can live comfortably without working but I am not to that point yet mentally. But I know there is always the unexpected in front of me.

  5. Carrie Porter says:

    I’m glad to see discussion of the “other” things for consideration in retirement. One big issue often overlooked is planning for the retirement of the car keys. On average, we outlive our driving ability by 7-10 years. Consideration of this fact should impact retirement plans.

  6. Glen says:

    I am going to be 76 shortly and work 12-15 hours a week at Lowes. I like the contact, the sense of belonging and the paycheck. You can take time off for vacation or other reasons. I have substantial savings and investments but the big concern is if I ever need long-term care. So I just purchased another life insurance policy instead of LTC insurance as a backup if there is the need to pay for LTC. This way if assets are used to pay for LTC then upon my death the life insurance pool will be used to restore either some or all of the money used for LTC and protect my spouse financially. I do not want to consume the assets for LTC and leave my spouse with little money. No one knows how things will be in the future!

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