Start your application now and choose your investments.
Free online investment help is just a click away.
By Michael Schoonmaker - April 9, 2018
My Conversation with Keith Lawrence, co-author of Your Retirement Quest
Approximately 10,000 Americans retire every day, but only half of them will have a great retirement, according to Keith Lawrence, co-author of Your Retirement Quest. Keith has helped thousands of Americans prepare for retirement, and money is only a small part of the equation. I had a chance to visit with him about keys to a successful retirement and the five myths about the retirement experience.
Whether we care to admit it, our lives are often tied up in our work. Our identities, friendships and social lives are connected to how we spend our working years. We have high hopes for the retirement chapter of our life story, but we struggle with the transition.
Most people are excited by the prospect of retirement but are unaware of the challenges they'll face. And we traditionally spend most of our preparation focused on the financial part of retirement, but it is only one piece of the puzzle. As Keith says, having a holistic, written "life plan" greatly increases the odds of having the future you expect.
Keith shared five myths about retirement and common mistakes people make:
In reality, retirement is not an easy transition. The loss of routine and structure and a sense of purpose is challenging. Further, we lose connections and friendships as we step away from daily work. Work results in mental sharpness, and many people experience a sense of loss.
We are busy living our lives and working right up to the retirement date. As a result, many people plan to take six months off to "figure out what's next." In the end, that plan is very risky. New retirees end up effectively wasting time with nothing to show or point to as successful. That's why you should make a life plan while you're working, alongside your financial plan.
A very common mistake is not involving family members and friends in the planning process and simply stating decisions after they've been made. It may be one person's retirement, but it affects others as well. For example, many new retirees choose to downsize or relocate without involving their adult children in the decision. For some, that may result in loss of family holidays with the absence of a "homestead" for everyone to gather. In situations where one partner has been primarily at home, there is an adjustment to suddenly having the "other half" around during the day. Make sure to involve family and friends to create a shared vision for the future.
As Keith says, "The only difference between a rut and a grave is the dimensions." Planning for retirement should include considering what you could potentially do. It may be another career, volunteer work, or schooling. Retirement does not mean the absence of activity or purpose. We can use retirement for an entirely new experience socially and intellectually.
We have an ill-conceived notion that a certain amount of money will result in a perfect retirement. There are many examples of people with large fortunes who are unhappy and people living solely on Social Security who are perfectly content. What we do know is that saving for retirement is an important endeavor and may certainly alleviate some worry around covering daily living expenses. However, a financial plan should accompany a life plan to prepare for a successful retirement.
Envisioning the future that you're working and saving for now can help keep you on track. Create a plan with the support and involvement of your loved ones, visualize that new chapter for you and your family, and prepare to live a fulfilling retirement.
And remember, we can help with the financial aspects of your plan. Call us at 1-800-345-2021 to get started.
Learn how providing a SEP IRA or SIMPLE IRA could power up your small business—and its employees—with tax benefits.
Oct. 16, 2018
The rules for women and men are the same, but your strategy shouldn't be.
March 21, 2019
Debt, taxes and Medicare—learn how they may impact your social security check in part two of our social security series.
November 07, 2017
Despite the buzz, record market highs shouldn't be a catalyst for changing your portfolio.
Can you stop financial stress before it starts? A comprehensive plan can help you manage life’s financial hazards.
Estate planning isn't just for wealthy "fifty-somethings." If something happens to you, having a plan can make it easier for those you love.
The opinions expressed are those of American Century Investments (or the portfolio manager) and are no guarantee of the future performance of any American Century Investments' portfolio. This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal or tax advice.