Ingredients of a Happy Retirement

The retirement we ultimately decide to live is personal. Within the parameters of our individual financial situation and current health status, how we choose to live is up to us. We manage our days. We fill the calendar. We are in control.

Retirement affords the unique opportunity to become the person you want rather than the person you are supposed to be. The trick is to figure out who that is as soon as possible. As Zane Grey said, “we’re burning daylight.”

Everyone has advice to give. Friends generously share specifics of their retired life, perhaps bragging a bit, maybe complaining a tad. Books enumerate the good and bad pointing out pitfalls and pinnacles you are likely to encounter. Retirement bloggers share their journey as they learn to navigate their individual retirement jungle. Each source sheds some light on what it means to live retired 24 hours a day seven days a week. Yet none of these sample cases is necessarily how YOU will live your retirement. Your path to retirement is yours to blaze.

When it comes to the manufacturing the perfect retirement I don’t believe there is a generic one-size-fits-all recipe. We are different people. Our interests are all over the map. What excites you may bore the pants off me and visa versa. Each of us is responsible to find our respective way. How we get there is not always easy to predict. Plan on taking some missteps along the way but keep going.

And who wants a “perfect retirement” anyway? Perfect anything requires an attention to detail that has no place in the free flying life we can experience as retirees. It sounds like unnecessary stress if you ask me. I prefer to view retirement as a work-in-progress, a continually changing experience where we weed out what we don’t enjoy and add in what we love. What works one day may not another – that’s perfectly fine. It should be about making the most of each day. And the awesome reality of retirement is you get to decide exactly what that “most” consists of.

Retirement is an evolution. The person we are five years down the line is not the same person we were at the beginning. We learn, adapt, try a little of this, experiment with a little of that, and slowly learn how to make the most of our second act. That intensity and drive that was part of the working me has morphed into a more mellow go-with-the-flow retired me. I think my wife appreciates the change. I know my heart doctor does!

I write this blog from a little two-seater rocking chair, looking out my front door at my recently pruned roses whose healthy shiny leaves are beginning to return for a new season. A wind chime softly tones while a single bird twitters in the tree perhaps chiding the barking dog down the way. After weeks of rain – a rare occurrence in the Valley – the sun is out, the temperature is warm, and the sky is blue. Does it get any better?

Earlier today my wife and I went to Trader Joes – we love that place. We wander the isles finding intriguing new offerings along with our basics like fruit, veggies, bread, nuts, etc. My latest discovery is the Herb Popcorn – talk about addicting. From there I drove a few miles down the road to take a 90 minute walk along the shoreline. The California coast is definitely my sweet spot. Combine one part majestic coastlines strewn with craggy rocks, add a dose of booming waves breaking mercilessly on said rocks, throw in a pinch of riotously blooming cacti, and last but not least include the possibility of spotting a breeching whale lingering on horizon – that is my recipe for inspiration. When at the ocean it feels life just makes sense. One of my favorite quotes: ”the voice of the sea speaks to the soul.”

I think living a happy retirement comes down to figuring out what you most enjoy and then doing it. Sure there are days when you don’t feel 100 percent – that is part of the program. But when you do feel good make the most of it. Don’t worry about what you used to be able to do – do what you can. Be forever curious – the world is amazing in so many unique ways. Take a chance and venture outside your comfort zone. Remember you are not obligated to do anything. If a new direction turns out not to be what you expected, abandon ship! Move on to the next adventure, the next hobby, the next challenge, and the next reason for living.

Living a happy retirement life is something we all hope to experience. Good luck on your journey.

How Do People Around The World Plan For Retirement?

Written by Sally Perkins

Globally, most governments provide for some form of social security and retirement income. But as human lifespans are increasing by approximately three years every generation, there is a global trend of governments pushing back the age at which retirees can claim social security benefits. With government retirement schemes struggling to accommodate a growing population of retirees who are living longer than ever, the burden of saving for a comfortable and fulfilling retirement is increasingly being passed on to the individual.

The rule of thumb for financial planning is to assume you’ll need about 70 percent of your pre-retirement earnings to maintain your standard of living into retirement. In the United States, Social Security benefits will cover about 40 percent of your income, but unless you can count on some kind of windfall before your mid sixties, that leaves a 30 percent gap that either needs to be funded by a retirement savings account or a drastic lifestyle change.

As you think about your own retirement plans, you might take inspiration from how other workers around the globe prepare themselves for their retirement, financially and otherwise.

Going Dutch

The Netherlands regularly ranks among the best pension systems in the world with benefits from the 3-pillar pension system amounting to about 70 percent of pre-retirement income. There’s many factors that explain why this system is so healthy, but a key piece is that pension funds are compulsory, much like paying into Social Security in the US, only in the Netherlands it generally provides enough to live on comfortably during retirement. But for younger workers who make a good income and want to invest their money more aggressively, this system can make them feel handcuffed as their earnings have to go into the same investment pool with the earnings of older workers for whom risky investments wouldn’t be prudent. And as the lifespan of its population is growing, starting in 2022 the age of retirement will be linked to life expectancy and Dutch workers may need to wait even longer to access their pensions.

An Aging Southeast Asia

Compulsory retirement at a certain age for private sector employees has generally been deemed discriminatory in most nations, but is still in effect in Singapore where, under the Retirement Age Act, employers can mandate retirement starting at age 62, the minimum retirement age nationally. Thailand has a population that is aging faster relative to other Southeast Asian nations, and in spite of statutory severance pay for workers age 60 and over, most Thais have no post-retirement income plan. In Malaysia, workers must fund an Employee’s Provident Fund (EPF), but as with US Social Security, it’s rarely enough to provide a livable income post-retirement and workers are encouraged to find strategies to save for retirement.

UK Workers Push Past Retirement Age

More than 1.4 million over-65s in the UK continue to work at least part time, either because they need to make ends meet or simply because they want to. There’s a certain stigma around retirement, that it’s the end of something rather than the start of an exciting new chapter, which has contributed to many working past retirement age for fear that they will feel useless or lose their edge without work. There’s also less incentive to retire in the UK since workers can continue to work beyond the State Pension age and still receive their State Pension. But according to the Office for National Statistics, health and wellbeing often increase while depression and anxiety fall once workers are no longer burning the candle at both ends. The tradeoff may be well worth it.

Swedish Death Cleaning

One of today’s trending retirement routines comes from Sweden where the act of “death cleaning” helps people prepare for the last act of their life. Honestly less morbid than it sounds, Swedish Death Cleaning is about enjoying the process of going through and paring down your possessions to be able to focus on the really important things. It’s also an act of respect for your loved ones who ultimately end up responsible for your things when you eventually pass away. People in Sweden – and worldwide – have found that downsizing earlier in retirement not only simplifies one’s day to day life, it lifts a psychic weight that makes retirement more carefree. Downsizing – a Global Trend?

Minimalism isn’t unique to Scandinavia, though they seem to have perfected it. Worldwide retirees are finding that by shedding worldly possessions or attachment to a place, they are prepared to travel in retirement or settle in another country where their retirement savings can stretch much further.

While the specifics of retirement schemes may vary from one country to the next, it’s fairly universal that people all over the world must plan ahead to be able to have financial freedom in retirement. Whether that’s saving money on top of pensions or preparing to live a more streamlined and affordable life, foresight is the key.

Why We Don’t Plan for Retirement

Guest Post by Rob Schultz, The Retirement Guy

I recently read an article, “10 Retirement Lessons from a Retired Retirement Pro”, by Richard Quinn that had been published in MarketWatch and HumbleDollar. The article’s opening paragraph struck a chord with me and I share it here.

“For the better part of 40 years, I spent a great deal of time helping thousands of workers prepare for retirement. We ran seminars for workers and spouses on topics like retirement income, insurance, lifestyle, relocation and more. I think it’s fair to say that, if someone took advantage of the programs offered, they would have been well prepared financially and emotionally for retirement. Sadly, relatively few workers utilized all that was available to them—this despite the support and urging of the unions that represented them. I retired in 2010, suffering in part from banging-your-head-against-the-wall syndrome.”

Since I blog and teach about retirement planning in a similar fashion to what Mr. Quinn did, I can empathize with his frustration and head-banging. I have struggled myself with the question of, why the vast majority of people do such a poor job of planning for something that could last for 20-40 years of their life?

I believe the reason is because there are no immediate consequences for not preparing for retirement. For example; if I continually violate the speed limit, chances are I will eventually get a ticket. If I drink and drive, I am going to eventually lose my license. If I don’t pay my utility bills, I am going to have my water, gas & electricity cut off. If I don’t make my car payment, I am going to have my car repossessed. You get the picture. There is a quote which I attribute to my pastor friend, Dix Winston. “You can choose your actions or you can choose your consequences, but you can’t choose both”. Most of our actions in life, have fairly quick consequences. But retirement doesn’t work like that. You can go along for 20, 30, 40 years without planning for your retirement and for the most part nothing terrible happens, until it is too late.

I am frustrated by people that identify a problem, but offer nothing in the way of a solution, so I will propose one. Financial literacy education, beginning in elementary school, is a practical way to address the problem of not only retirement planning, but also; inadequate savings, debt, poor credit, budgeting, etc..

Bob is a retired human resources guy who blogs about retirement planning on his website, http://www.retirementguy.org.