What’s Your Mindset About Retirement?

By Marianne Oehser

Your mindset affects every part of your life. That is especially true about retirement. Your attitudes and beliefs about this time of your life will determine whether you see endless possibilities or whether you buy into some of the negative myths. It will affect your health and your happiness.

Most people choose one of two mindsets about retirement: The Euphoric Mindset or the Gloom-and-Doom Mindset

The Euphoric Mindset

As we approach retirement, most of us are ready to say goodbye to the hectic pace and all the stress that goes with most careers. We are ready to downshift a bit and are excited about enjoying our much earned ‘vacation.’

The retirement picture we create in our minds is often the Hollywood version with lots of excitement but not much clarity. It’s filled with images of things we want to do — travel, golf, tennis, boating, or anything else we have dreamed of doing. And, probably the new toys you want, like a boat. For many of us, that is just how retirement starts and it feels pretty euphoric. Enjoy it while it lasts.

Just like any outstanding vacation, it is not a permanent state. It is simply not realistic to expect the euphoria and the newness to last forever – but somehow, we do it anyway. We think that being on vacation for 20 years will continue to have the same excitement that it had in the beginning. But, it doesn’t – it fades.

The problem with a Euphoric Mindset is that it leads to disappointment. The day will come when all the play is not as much fun as it was in the beginning.

This can create a new kind of stress. Retirement no longer fits your Hollywood image and you don’t know what to do about it. You are no longer sure what you want your days and weeks to be like. You probably feel like you are a bit adrift.

That is when it’s time to get serious about building your Happiness Portfolio®. That means designing your new life so that it is balanced and diversified just like your financial portfolio. Research shows that the people who are the happiest in retirement are those who invest time and energy in all aspects of their life — having fulfilling relationships, enjoying social connections, making a contribution in some way, maintaining your health, enjoying leisure activities, growing as a human being in some way, and incorporating spirituality – whatever that means to you.

If you are looking at retirement with a Euphoric Mindset, by all means keep the mindset that this will be the best time of your life but be realistic about the fact that the honeymoon will end and figure out what you want your life to be like when it does.

The Gloom-and-Doom Mindset

The opposite of the euphoric mindset is the gloom-and-doom mindset. The gloom-and-doom mindset looks at retirement as the end of the line. The story it tells you is that all the good things in your life are over and there is nothing more to look forward to. It tells you that you are being put out to pasture because you are useless. It says that everything is downhill from here and focuses on your own mortality.

One of the big problems with such a negative outlook on this act of your life is that it can become a self-fulfilling prophecy. When you are focused on all of the things that are potentially bad about this new phase, you are not likely to see the endless possibilities for how great your life can be now. This kind of thinking can negatively impact your health and lots of research studies have shown that it probably will. It will definitely turn you into a grumpy person and can lead to serious depression.

Of course, there are some legitimate things that are not so wonderful about this phase of your life. You probably don’t have the boundless energy of your youth. You might fear that you will become ‘irrelevant’ and may not keep up with all of the information and technology changes that will certainly evolve. A whole segment of your social life will disappear including the people you interacted with as part of your career. These things are real but you don’t have to let them take you down a rabbit hole you can’t get out of.

Shifting your mindset to a more positive perspective will allow you to look at things differently. Choosing a story that includes the possibility that there are more positive things ahead will shift your mindset and allow you to see ways to deal with the downsides of life after your career.

Staying stuck in either the euphoric or the gloom-and-doom way of looking at retirement will not serve you very well in the long run.

A Third Option

Carl Jung, Ph.D. was a Swiss psychiatrist and founder of Analytical Psychology who had a profound impact on how we see a wide range of areas today. Dr. Jung offers us another way of looking at this stage of life. He talks about the “afternoon of life.” The morning of our life is focused on achieving things – getting an education, building a career, raising a family, acquiring things, becoming someone. Dr. Jung says the “afternoon of life” is not just a “pitiful appendage to life’s morning” and rather than seeing our afternoon as a process of reduction, he says it is a process of expansion.“The afternoon of life is just as full of meaning as the morning; only, its meaning and purpose are different.”                              

This way of looking at the new chapter of your life suggests that there is much to be savored about it. The afternoon just has a different rhythm than the morning. It may be a time for slowing down a bit but it can still be filled with enthusiasm and activity. It is an opportunity to focus on different things than you did in the morning of your life. It is an opportunity to see new and different possibilities for how you invest your time and energy. It is a time to discover the meaning and purpose of your own afternoon.

It’s time to bask in your afternoon sun.

Getting Ready to Retire – How to Ensure You Will Have Enough Money to Make it Happen and Live Comfortably

Written by Veselina Dzhingarova

Retirement is something that many people look forward to, work hard for, and count down the days until it becomes a reality. No longer having to work, spending your days doing whatever it is you feel like doing, and just basically enjoying your time is a goal that many people share. Of course, a happy and financially sound retirement doesn’t just happen by chance. Instead, it takes plenty of advanced planning, saving, and preparing.

So, as you grow closer to your retirement date, how can you ensure that you’ll have enough money to retire on time and live comfortably? Here we’ll take a look at some tips and advice that can help answer these questions.

Speak to a Retirement Planning Professional

One of the best pieces of advice for soon-to-be retired individuals is to make an appointment to speak to a retirement planning professional. Even if you think you are fully prepared, organized, and ready to retire from a financial standpoint, it’s still wise to touch base with a professional that can look over your savings and provide you with a detailed plan.

Berger Financial Group, a Minneapolis retirement planning group, stresses that a solid financial plan will ensure the savings you have amassed will stretch the distance. You want to be sure that you understand how much money will be available to you, and the best ways to stretch it and make it last.

Consider Downsizing

As you approach your retirement date you may also want to think about downsizing your lifestyle in general. If you own a home, now is the time to ask yourself if that much space and land is needed. It could be that downsizing is a better plan both financially and from a maintenance standpoint. If you plan on doing a lot of travel during your retirement years, owning a small condo with no exterior maintenance could make more sense.

Downsizing also means you can find something cheaper, which means more money goes into your retirement savings.

Create a Brand New Budget

It’s also wise to create a brand new retirement budget. This takes into account all your expenses and how much money you will have coming in once you are no longer working. It may be that you need to cut back on some expenses in order to make the budget more manageable. Knowing this information in advance will prevent you from over-spending.

Take a Look at Your Investment Portfolio

If you have any investments, now is the time to take a look at those too. You don’t have to stop investing just because you are retired. It may just be that you want to change things up and diversify where you are investing your money.

Setting Yourself Up for a Happy Retirement

By following these steps, you’ll be setting yourself up for a happy and comfortable retirement, allowing you to have the break you deserve.

How to Avoid One of the Biggest Retirement Mistakes

Written by Danielle Kunkle

There are thousands of baby boomers nearing retirement every day. According to Investopedia, about 75% of these baby boomers admit to being behind on saving for retirement. The other 25% may soon come to realize that they aren’t as prepared as they thought they were.

They may come to this realization because most baby boomers are unaware of the fact that Medicare, although paid for during your working years, isn’t free.

Most new Medicare enrollees are surprised to find out that everything they have been paying towards Medicare was only for one part of Medicare, Part A. Once they calculate their potential costs for all the other parts of Medicare, they conclude that their savings aren’t as adequate as they thought.

So how do you avoid the biggest retirement mistake you could make? Simple, you need to plan. Follow the steps below.

Discuss Things Beyond Money with Your Financial Advisor

Now that you know that Medicare isn’t free, you need to discuss the costs of your healthcare in retirement with your financial planner.

Not only that, but you need to discuss with them how often you go to the doctor, what kind of lab work and tests you get on an annual basis, and anything else that might cause a divot in your savings. This may seem like too personal of a subject to discuss with a financial planner, but it’s necessary.

According to Fidelity, on average, a couple will need $280,000+ in retirement savings just for healthcare costs. Discussing your health status can help you and your financial advisor plan for potential expenses such as needing a Medicare Supplement plan or long-term care coverage.

Be Ready for the Unexpected

Never assume that your health will be in tip-top shape for the rest of your life. Yes, you may be healthy now, but that could literally change within a day. Similar to an emergency fund, set aside money in the chance that you become chronically ill.

Suppose you get diagnosed with cancer. Chemotherapy alone costs tens of thousands of dollars in one calendar year, not to mention the surgeries you’d need.

You’ll want to be prepared for an unexpected diagnosis just like this one. If you become ill, the last thing you will want to worry about is how you will be able to afford to fight for your life. Put the right coverage in place to protect yourself.

Plan for Possible Loss of Employment

We’d like to think that our place of work will always have a spot for us when we get into retirement age. However, ageism in the workplace is no myth. Sometimes, employers see the new, younger applicant walking in as the best person to take over a job you’ve been doing for years.

With more baby boomers planning to continue active work past the age of 65, the possibility of having your position taken away from you grows. Therefore, you should never bank on always having that biweekly check flowing into your account.

Have money set aside to replace your income if you were to lose it suddenly.

Set Up an HSA

An HSA is a health savings account. Having this account allows you to be able to put away money without having taxes being taken out of it. The purpose of this account is to help pay for qualified medical expenses.

As of 2019, the maximum contribution amount for an individual is $3,500, while the maximum contribution amount for families is $7,000. Those who have an HSA and are at least 55 years old is allowed to contribute up to $1,000 extra each year.

Qualified medical expenses you can use your HSA to pay for include but are certainly not limited to, hospital services, long-term care, dental and vision services, and even insurance premiums. You can also use your HSA to cover your immediate family member’s qualified medical expenses.

How to Set Up an HSA

To be eligible for an HSA, you must be enrolled in a qualified high-deductible insurance plan. Once you have that setup, you will be able to set up your HSA either through your employer or a bank.

Next best step is to have money be auto drafted from your checking account to your HSA. This will help you make sure you always have a steady flow of money going into your savings account.

Health Savings Accounts with Medicare

Having Medicare while contributing to your HSA is not allowed. If you enroll in any part of Medicare, you will no longer be legally allowed to contribute to your HSA.

Therefore, to continue to be able to contribute to your HSA past 65, you must delay enrolling in Medicare. The only way you can do this without having to pay a late penalty later is to continue to have creditable coverage.

The most common form of creditable coverage past age 65 is a large employer group health plan. If you continue to work for an employer with 20 or more employees and keep their group plan, you can delay Medicare and continue to contribute to your HSA.

Start Now

The biggest retirement mistake is just failing to plan ahead. If you haven’t been putting enough into savings, start now. Try to start at least doubling the amount you save monthly to try and make up for lost time. The more you can put away now, the better your retirement will be in the long run.