What does retirement look like for you? You can sit on your porch and rock out while sipping lemonade while watching the world go by. Do you want an active retirement? Are you still able to travel, start a business and spend time doing the things you love? Do you want to retire early? Do you want to retire now?
Retirement is changing with increasing life expectancy, improving health and increased planning. How can you ensure that your retirement is a time of happiness? Effective goal setting and planning are key to achieving those goals.
Retirement was once seen as the end of one’s working career. But, retirement today is more about a life transition. You can still pursue hobbies, business interests and travel when you retire “early”, which is usually defined as being before you become eligible for Social Security.
People in their 60s today are generally healthier than previous generations. This will continue to increase as people live longer and take advantage of advances in medicine. The life expectancy is also rising. A 65-year-old could live to 77 1/2 in 1935. A 65-year-old can expect to live up to 82 1/2 years today. 10% of 65-year-olds will live to the age of 98. This trend will continue to grow in the future.
What can you do to plan for the next decades of your post-employment life?
What is Retirement?
Traditional retirement was defined as when someone leaves work to receive a pension, social security, or other assets. This traditional view of retirement is rapidly changing. More people are leaving “employment” to pursue other hobbies.
o Start a business, or work from home.
– Part-time work or rewarding but low-paid jobs, such as teaching.
o Volunteering.
o Manage investments (rental properties, investment portfolios).
o Engaging with a hobby.
o Caring for loved ones
o Moving to or traveling to a vacation spot.
Retirement is now a time to look forward, rather than regret the end of a career. Many people leave work joyfully to pursue their true passions and goals. Retirement is now a positive transition. However, it will require careful planning to make the most of it. Setting goals is an important part of planning for retirement.
Why should I set specific retirement goals?
It is crucial to set retirement goals. Determining your retirement goals will help you:
o Make a plan for your retirement that is more realistic and effective.
o Get more motivated to reach your goals. You will know how much money you need to save and budget now to reach your goal.
o Transition from full-time work to retirement with ease.
You’ll be able to clearly see your retirement goals and the steps you must take to achieve them.
What are my Retirement Goals?
It is easier than you might think to set your retirement goals. We just need to help you get clear on what you want. Follow this simple exercise to help you think about what retirement looks like.
Step 1 – Brainstorming your ideas
Spend 15 minutes brainstorming the answers to these questions. You can do this exercise alone if you’re planning to retire with your spouse. Brainstorming is the act of writing down what comes to your mind. There is no right or wrong answer. Do not spend too much time pondering over your answers. Just write them down.
1. What would you do with your spare time if you had a pension that covered your monthly expenses?
2. What would you do with a $100,000,000 prize from the lottery?
3. Your doctor will tell you that you can live until 100 years old and remain healthy mentally and physically. Your physical activity will decrease gradually starting at age 90. What are you going to do with your spare time?
4. Your doctor tells you that you will be able to die peacefully at 65. You will be healthy until then. What will you do with your time?
After you have answered the questions, go back and review your answers. Are there any surprises? Next, mark your top three answers and proceed to Step 2.
Step 2 – Set results
Next, consider why you want that goal. What are your goals and objectives? What is your vision of that goal?
If you want to spend more quality time with your family and friends, what is the best way to do it? Is it to spend time with grandchildren, go on holiday, or help a sick family member? What would you gain from spending time with your grandchildren, and what would it cost? It may sound obvious, but it is important to write it down.
This is your motivation. A goal of saving $300 more per month to retire is not enough motivation. You may find that the vision of your grandchildren playing at the lake house all summer is enough to motivate you to save $300 per month for retirement.
Step 3 – Specify
You should specify a dollar amount and a time frame for your goals. Although you may not be able to know the exact cost of your goal, you should give a rough estimate so that you can make an effective plan. Contact your advisor or financial planner if you require more information.
Retirement can be thought of as a series of stages when you set your goal.
1. Part-time work, managing investments or starting a business can result in lower or unpredictable incomes.
2. You can be active but not making an income by working in hobbies, traveling, volunteering, or spending quality family time.
3. Activity reduced due to health problems or mobility restrictions
Retirement may be viewed as multiple goals with different time frames and monetary requirements.
1. Provides basic needs and medical insurance.
2. Consider long-term care options.
3. For a more luxurious, higher quality lifestyle.
4. Travel.
5. Maintaining a time-share or vacation home.
Why are You Waiting?
Why wait to create the life you want? First, you need to identify your goals and create a plan. You can live the life you want, even if it takes years or decades to realize. Spend time with your family, take time to do your hobbies and join interest groups. Retirement isn’t a time, it’s a state of mind.
