You can read lots of articles, listen to podcasts and watch videos on what to do to create an ideal retirement. That’s great but you can hurt your golden years by not paying attention to some potential retirement landmines – danger zones that can sink even thoughtful retirement plans.
Here are five retirement landmines to avoid:
Retirement Landmine 1: Fear. As I write this, we are in the middle of the coronavirus crisis, also known as COVID-19. Many of us are reasonably concerned, and some deeply afraid. While a lot of this fear is based on the constant stream of negative facts, much of it comes from the dreaded “unknown”. What is going to happen to the stock market? Are my family and friends safe (not to mention myself)? How long will it take us to recover from the financial and health implications? The lack of certainty about the future is as bad, or sometimes worse, than the reality of the situation.
Retirement fear may not be as intense as COVID fear but it can wreak havoc on your emotions and health. Operating in a state of fear makes it more likely that you will make poor decisions like selling your stocks at the bottom of the market. Fear can also stop you from pursuing retirement activities that can enrich your life and keep you feeling younger and happier. In this case, it may be the fear itself, not the circumstances, that holds you back. As Rudyard Kipling put it, “Of all the liars in the world, sometimes the worst are our own fears.”
Retirement Landmine 2:Inflated Expectations. Retirement can be a great part of your life, perhaps the best part. But it will not be the same as what you experienced pre-retirement, at least for most of us. We lose a step or two, our old work colleagues don’t return our phone calls, and the profession that made us so proud doesn’t carry the same prestige when it is something that we “used to do”. And although there are exceptions, most golfers don’t drop 10 strokes from their handicap because they now have all this time to focus on the game. This is not to say that your life can’t be fantastic, just set your objectives in such a way that they are reasonable and achievable.
Retirement Landmine 3: Lack of financial preparation. Figuring out all the investment, budgeting, financial draw-down, IRA, Roth, 401-K, social security, insurance, and long-term health plans options can be daunting and exhausting. But let’s face it, poor finances can be one of the biggest retirement landmines and inattention can endanger your future in a big way. I believe that the better informed you are about such matters the better, but some people just have no talent or interest in finances, and in this case, one or more trusted and certified advisers can help you gain much better future cash flow and financial security. Read Achieving Financial Security for Peace of Mind for more information on this important topic.
Retirement Landmine 4: Living for others. Of course, you love your children and grandchildren and the thought of being away from them fills you with dread. But are you staying in a location that no longer serves your needs, where recreational facilities are lacking and perhaps the climate is bad – instead of going where your heart desires (to the beach, mountains, golf community)? And are you making this lifestyle sacrifice for the sake of your children or grandchildren? There are some cases where this is warranted but, in many instances, this is counterproductive. Your grand kids grow up and move away anyway. Plus, airplanes and cars, not to mention FaceTime or Skype, can keep you connected, albeit this is not as nice as in person visits. Remember how it worked when you sent your kids off to college? My son still teases me about the way I cried when I moved him to his new dorm. Perhaps like me, you had a rough adjustment, but you adapted to their absence, and truth be told, grew to enjoy the empty nest household.
There is one other way you can endanger your retirement for others: a continuous drain on your finances due to funding adult children or grandchildren. This is probably not a good scenario for anyone involved, and can have a big negative impact on your quality of life. I know of one case where a couple in their 70s had to sell their beloved home to compensate for the financial drain caused by their generosity to an adult son. Hopefully, you have raised your kids in such a way that they are self-sufficient, but if they missed this lesson, it is sometimes better to for them to learn painful financial lessons than being dependent on you.
By the way, it is not only adult children who can drain you financially, but also aging parents. Many of us in our 50s and 60s provide at least partial financial support to both adult children and parents. Dave Ramsey has an informative article on this subject, The Financial Struggles of the Sandwich Generation. Mr. Ramsey definitely sees this drain on your financial resources as one of the most dangerous retirement landmines.
Retirement Landmine 5: Failing to act. The above issues like fear and living for others cause retirees to wait too long to pursue what is best for them. You’ve always wanted to tour Europe but your declining health makes this impossible. You have a dream of living in an adult community and by the time you are ready to do this, most of your “active days” are just a memory. You want to find a life partner but you stay at home because of a fear of rejection. In each of these cases, and many others, you have little to lose and worlds to gain by acting. So even if you have doubts, sign up for that cruise, make an appointment to tour the active adult community, go to the community social, or put your profile on the dating site.
This failure to act has been something that I have personally struggled with, so it has given me a lot of empathy for others who face this challenge. It has taken me a bunch of decades to understand that (as deathbed studies have shown) in most cases, it is what you don’t do in life that you regret, not what you did do. By taking action, you might well be disappointed – this is part of life. But you may also find your ideal lifestyle, the home of your dreams, a fantastic new hobby, and more reason to get out of bed every morning.
One more point about action. The tendency is to wait until the whole plan is laid out before acting. With all respect to thoughtful planning, the actual implementation almost never comes out as planned. As Helmuth von Moltke put it, “No battle plan survives contact with the enemy.” This is as true in your life as on the battlefield. If there are many steps to get you to your goal of an ideal retirement – start with step one. Just start. You are not committing to every succeeding step, but you are on the path to a happier and more productive retirement.