Written by: Chad Smith and Allison Berger
Which retirement stage are you in?
Spoiler alert: the stages begin before you are retired. You’ll also be surprised by some of the stats we uncover as we dissect findings in the latest Age Wave study on retirement.
We’ve had the pleasure of working with hundreds of families as they have planned and transitioned into retirement. Let’s dive in to this episode to explore how you can maximize these 4 phases of retirement through financial planning.
The anticipation stage
The anticipation stage occurs during the 10 years prior to retirement. Optimism, excitement, and anxiety are the predominant feelings during this stage.
Many people choose to maximize their savings while their income is still high and become hyper-focused on saving for retirement at this time.
Others may still be saving or paying for their children’s education or helping them launch into the world and have put aside retirement saving for the time being.
This is a critical time to save since the question of whether you will have enough is always in the back of your mind. Since today’s retirements can be 30-40 years or more, you’ll want to make sure that you are financially prepared.
The liberation/disorientation stage
Since you have been working for the majority of your life, retirement not only brings a sense of liberation but can also bring a sense of disorientation. You may not know exactly how to spend your time so this time period can be pronounced by a search for meaning and purpose.
Increasingly, some people choose to work part-time or follow a passion project in the early stage of retirement This type of pretirement can add purpose and value to your retirement while also bringing in a bit of a paycheck.
Press play to learn how important it is to maximize your tax planning during this time of retirement.
The reinvention stage
The reinvention stage is the heart of retirement. Between 3-15 years into retirement retirees hit their stride. They take on new roles and activities and enjoy the opportunity to spend quality time with family and friends.
This is an excellent time to take steps to improve your health by enjoying activities that keep you active and healthy.
Unfortunately, only 35% of retirees in this stage feel that their finances are in good shape. Our goal is to help you feel more comfortable and confident so that you can truly enjoy retirement in all its stages.
The reflection and resolution stage
The final stretch of retirement has many people thinking about their impact on those they love. Most people would like to be remembered for their personal character and the experiences they shared with loved ones. Some have their legacy on their minds even though only ⅓ of those questioned had the most important estate planning documents in place–a will, a power of attorney, and a healthcare power of attorney.
If your finances are not in order this can be a worrying time. Health or long-term care planning can add to this worry. If you don’t have all of your ducks in a row this is an excellent time to take action and begin estate planning.
Of those interviewed in the study only 30% were working with a financial advisor. As you work to prepare for retirement, a financial advisor can help you understand the opportunities and risks that you should be aware of. Check out our free pre-retirement checklist which can help you prepare during this stage.