How to Avoid Money Worries in Retirement by Bill Storie
As most people who are approaching retirement will tell you, they are concerned about whether they will have enough money in retirement.
But before I get into that, allow me to play semantics for a minute. In the sentence above I said “have enough money in retirement”. I did not say “have enough money to retire.” The difference may seem subtle to most people but it has deep meaning. The vast majority of working people will retire whether they want to or not, and more to the point the decision to retire will not be based on whether you have enough money TO retire. The decision will be made for you regardless of how much money you have (mandatory, age-driven or early redundancy, etc). The much more important question therefore is whether you will have enough money IN retirement. Think about it.
We have stated a thousand times through this Blog that while you are still working, you must pay close attention to figuring out what income you will receive when you retire. You can’t afford to have any surprises the day after you enter the golden years. Too late.
Some people, in fact many people, are frightened by financial projecting. Maybe they’ve never seen a spreadsheet in their working life and have no idea what to use it for. Fair enough. But is that good enough reason to leave your retirement finances to chance? Of course not.
So I’m going to assume that you’ve done your homework and you feel reasonably satisfied that you’ve worked out what your income and expenses will be in your retirement. I will also assume that you have at least thought about the longevity issue – not that you can predict how long you will live, but that you are aware of the impact of out-living your money. You’ve also given some consideration to having a big ticket cost somewhere along the retirement path – an illness, a family emergency, a housing issue etc. Yet again, you can’t predict the unexpected, but you should at least be conscious that such an event could occur and have some notions about how to handle it.
OK, so now we’re in retirement. What next?
You’ve figured out what you are going to do with all this free time and worked out a routine for each day as best as possible. Good show. You maybe have a travel schedule. You may even have a Bucket List, yikes !!!
Ok, so far so good. So Bill, how do I avoid money worries?
You don’t have any.
Oh sure, you’d like more money to spend, who wouldn’t? And you are much more penny conscious these days – good idea. But here’s the secret.
If you worked out before you retired that your income would be 100 Units per year and that by and large your expenses would be 90 Units per year, you’d have been satisfied right?
On the other hand if you’d projected income of 80 Units and expenses of 90 Units you would, to the best of your abilities, have tried to increase your retirement income amount – or you would have cut back on your outgoings, right?
So leaving aside the wish that we all have to want more money in retirement, if your lifestyle today in retirement is as planned and projected, and that was agreeable to you, then why are you worrying about your money situation?
There is nothing you can do about it. Not now anyway. Yeah sure, if you really do need more money then go get a part-time job (if you can), but if your lifestyle is as expected, and you are comfortable with it, then trust me….. you do NOT have any money worries. So quit worrying.
This is one of the fundamental principles we teach in our Olderhood Pathfinder Programs.
There are so many wonderful things to do in retirement once you get beyond the money worry stage. Obviously never ignore the pennies, and balance the check book of course, but start to focus on the other aspects of your retirement life and start to enjoy them worry-free.
Go on, you can do it. You can.
See you next week
By Bill Storie