Retirement: The Non-Financial Aspects
You are the right age to retire. You have the right amount of money. Is that it, though? What are you retiring into? Has that even been part of your thinking? What other aspects of retirement do you need to get into place?
Emotional Issues in Retirement
For most of our lives, we go through a routine. As children, we would get up, eat breakfast and get ready for school, spend our mornings in class or other structured activities, break for lunch, return to class, and go home at the end of the day. For the most part, that pattern continued into our working lives. Even if we are in jobs we do not necessarily enjoy, there is emotional security in that routine.
At retirement, that routine is disrupted. The pattern that anchors our lives for 50 to 60 years is no longer there. In response to the observation of the philosopher René Descartes that, “I think, therefore I am,” the working person might prefer to say, “I work, therefore I am.” As a consequence, the retiree asks, “Without work, what am I?”
Without that sense of purpose, retirees often find themselves bored, anxious, restless, and feeling useless.
Social Issues in Retirement
For many around the world during the last year or so, the social aspect of retirement was experienced by those who were still far from retirement. People who thought they had good solid jobs found that they were laid off as their employer was no longer able to operate under COVID-19 restrictions. Even those who were able to continue working were forced to WFH (work from home). Instead of interacting with your co-workers by chatting in the lunchroom, going for a walk, or taking a smoke break together (to be clear, I am not advocating for smoking), you eat lunch alone, go for a walk alone, or smoke alone. Furthermore, you could not even get together after work for fear of either catching or spreading the virus to someone else.
Imagine the social situation of the retiree, then, for whom that isolation comes on at retirement and continues for the remainder of one’s life. No more competition, no more cooperation, not even any more conflict. And being a troll on Twitter is not an effective substitute.
Health-Related Issues in Retirement
Retiring is dangerous to your health. A study by Stefanie Behncke of the University of St. Gallen found that there is an increased risk of being diagnosed with a variety of illnesses, in particular, heart attack, stroke, and cancer.
One does not need to consider diseases to recognize that there are health consequences to retiring. Although not all jobs offer benefits, many still do. You may have appreciated having benefits that covered prescription drug expenses, dental care, and perhaps massage. Often, though not always, those benefits are gone once you retire. If you are not yet 65 and therefore do not qualify for provincial supports, you may have to pay for your drugs out-of-pocket. Likewise dental care. It may be hard to pay for those things once you retire. Further, if you have been a frugal saver in your working years, spending money on those things for yourself does not suddenly become easier.
A study sponsored by the U.S. National Bureau of Economic Research on The Effects of Retirement on Physical and Mental Health found that “complete retirement leads to a 5-16 percent increase in difficulties associated with mobility and daily activities, a 5-6 percent increase in illness conditions, and 6-9 percent decline in mental health, over an average post-retirement period of six years.”
Wellness in Transitioning to Retirement
How can a retiree healthily manage the transition to retirement? Author Robert Laura finds that accomplishing the following six things will create a situation in which a person can transition well in retirement. The more that a retiree can check off as accomplished, the better the sense of satisfaction the retiree will feel.
Let’s look at each of these briefly.
Replacing One’s Work Identity
When you meet someone new, a common conversation opener is, “What do you do?” meaning what do you do for work. I know one person who retired from a career in healthcare who has since dedicated herself to volunteering for a variety of organizations that engage in conflict resolution and healthcare missions in several parts of the world as well as within Canada.
For others, it may work best to transition more slowly into retirement. Shifting from full-time work to part-time may be just what you need. It could be in the same occupation or could be in something entirely different. Another senior friend of mine spent his career in corporate accounting but in retirement went back to something he loved doing in his younger years, carpentry.
For others still, replacing one kind of work with another may not be the best solution. Perhaps you can find your identity in activities like researching your genealogical history or the communities in which you grew up. I have a retired cousin who is very much into genealogical research, and I know another retired person who has created a Facebook page about my hometown’s history and people.
Filling One’s Time with Meaningful Tasks
A retirement in which you spend the summer golfing, and the winter curling may seem ideal for some, but everything I’ve heard from people suggests that, while recreation may have its place, it is not a meaningful way to spend one’s life. Meaningful tasks may be the answer to replacing one’s work identity. Perhaps engaging seniors in care homes may provide meaning as well as insights from those who are a generation older than yourself.
Staying Relevant and Connected
I was at a national church conference once in which several of those elected to the various committee and policy roles in the denomination were in their late 30s and early 40s. I overheard two older gentlemen, both leaders within the broader denomination, observe not only the “passing of the baton” of leadership to the next generation but that their perspectives were no longer relevant.
I don’t think that they were necessarily irrelevant but if that is a fear for you once you enter retirement, what are some of the things that you can do? The person who wants to stay relevant seeks out connections, affiliation, and being part of something bigger than oneself.
Being relevant does not mean you have to run for political office, although you can certainly do that if you are so inclined. It does mean connecting to some kind of larger community, though. Engage with a variety of people.
Jeannette Lewis, a retired CEO of not-for-profit children’s services organizations in Ontario, suggests several ways to stay relevant.
- Keep learning about technology. On a personal note, when I worked at the discount brokerage, the firm decided to begin using two-factor authentication for added security, which typically required being able to receive a text message. Some older clients balked at this and said they were going to take their investments elsewhere. However, those security measures were being adapted at every other firm, too. You don’t have to be able to program in Python, but having some ability in the use of a personal computer or smartphone is pretty well a necessity and can extend your ability to stay in touch with people, to do your banking, to shop, and even to look up information.
- Work at general life improvements. Take courses, read, seek new knowledge. The cells of our body are constantly renewing. We need to renew our minds as well.
- Keep up with what’s happening in the world. That includes politics, government, the economy, the environment, and your local community.
- Engage with a variety of people. Variety includes culture, education, and age groups. I grew up in Chilliwack, BC. As a child, my neighbours were Dutch, Swiss, and German. As a student in elementary and high school, I had teachers from Australia, South Africa, and the United States. My classmates were Sikh and First Nations. As a young adult, I was the “stranger,” living in Japan for several years. I remember running into a senior citizen in Japan one time who invited me into a café for a cup of iced coffee. I was in my 20s, and he was probably in his 70s. My Japanese language skills weren’t that great and as I recall, neither was his English. But we managed to muddle through. That was somebody willing to engage. You don’t have to travel around the world to engage, but getting to know one’s neighbours, especially if they are of a different age or apparent culture is not a bad idea at all.
- Stay focussed on the present and future. The past is absolutely important, but it’s also of value to not get stuck in your past. You were not the same person you were 10 years ago. Life changes and so do people.
Keeping Mentally and Physically Active
Regular exercise is important not only for your body but also for your mind. Your blood circulation improves, and bones and muscles keep stronger. Simple acts like stretching and walking are important foundations for maintaining physical health. Start slow if you need to. Five years ago, I received a kidney transplant. The act of getting out of bed after the surgery felt like a major triumph. If you are sedentary, it may take a while to get moving again, but it’s important for both your physical and mental health. Establish a routine of exercise, hobbies, or other activities that will keep you fit.
Physical exercise will improve your sense of wellbeing and will put you in good stead to exercise your mind as well. With improved fitness, you may wish to learn new recipes for healthy eating. I never realized how good my dad was with growing flowers until after he retired. Creating a flower garden has benefits beyond physical activity. It also calls on skills in creativity and design. Travel, which is slowly opening up again, is also a great way to keep active. We do a lot of walking on our trips and the planning of a trip requires the exercise of one’s mind.
Expressing One’s Spiritual Beliefs
Those who know me, know that Christian faith and practice are important to me, both personally, and for many years academically and professionally as well. For this segment, though, I want to point out the importance of belief, religion, or spirituality, however defined, in the life of retirees. To some extent, this goes back to the aspect of meaningful tasks. What gives life meaning? What is the impact of the transcendent on one’s life in retirement? Spiritual beliefs and practices can be wide-ranging. Do you belong to and participate in a formalized faith community? Do you observe rituals or acts of meditation that anchor the more mundane affairs of life in the deeper levels of human existence? Are there temptations in your life that need to be restrained lest they cause pain to you or your loved ones? As I write this, what comes to mind for me is the British TV show Grand Designs. One season and there were probably more, a man took on the challenge of building this incredible house. Whatever the reason, he kept on going to the point of bankruptcy, destroying his marriage and his wife’s inheritance in the process. I think challenges are good, but every one of us has responsibilities to others, especially if we are married and/or have children.
Quite apart from specific beliefs, religious practices, or religiously founded ethical guidelines, many religions tend to provide a more positive and hopeful attitude about life and illness, a sense of meaning and purpose that positively affects healthy behaviour in relationships, and a greater ability to cope with illness and disability.
Feeling Financially Secure
If you work your entire career for an organization that provides a defined benefit pension plan with inflation protection, your retirement may very well be set for you, and you need to do nothing more to save for the day when you stop working. Unfortunately, that arrangement is becoming increasingly rare. Many companies that once provided defined benefit plans are now offering defined contribution plans, instead. And for many, the onus is entirely on individuals to save for retirement. It doesn’t mean it can’t be done, Contributions to the Canada or Quebec Pension Plan (CPP/QPP) help and the payments will be inflation-adjusted throughout retirement. In addition, there is the Old Age Security (OAS) pension and for those with a low income, there is also the Guaranteed Income Supplement (GIS). These last two come from general tax revenues, not your and your employer’s contributions.
Timing is also a factor. Advertising from an insurance company once promoted “Freedom 55.” One thing about that old ad is that we are living longer than ever. As we live longer, working longer makes more sense. Second, we want more from retirement. The number 55 may not be prominent anymore, but the images of retirees traveling all over the world, strolling along long sandy beaches is strong in our minds, even though it is not the lot of everyone. However, for many, adjusting one’s expectations – and planning accordingly – to fit the money available, can work out.
I am personally struck by the emotional/psychological aspect of retirement in these studies. As a financial planner, my focus is primarily on the financial aspects of retirement. But that is not enough. If there is a lesson here, it is that we need to take a much broader perspective. Indeed, there is so much more to retirement than financial security. In fact, given the emotional relationship with money that so many of us have, getting all these other things in good order will almost certainly help us to manage our money with greater confidence.
This is the 109th blog post for Russ Writes.
Click here to contact me for an appointment.
You may be interested in a half-hour no-cost, no-obligation financial planning conversation with me. Click here to sign up for a free session of FinPlan30.
Disclaimer: This blog post is intended for general information and discussion purposes only. It should not be relied upon for investment, insurance, tax, or legal decisions.