Whenever you’re looking forward to retirement, there’s probably going to be some uncertainties. After all, before you’ve experienced it yourself, it isn’t necessarily easy figuring out exactly what to expect or prepare for. It’s important for both you and your partner to take a well-rounded approach. Prepare for retirement together. What does this look like, then? Well, it looks a bit different for everyone.
According to Pam Hopman, “It can be easy for anyone to view retirement as the goal, in and of itself.” However, this isn’t the best approach. Especially when you take into account the importance of proper retirement planning. You’ll need to formulate a vision for retirement. Then take the appropriate steps to make that vision a reality. Furthermore, planning for retirement should go far beyond “regularly establishing and checking retirement accounts and retirement income products,” reminds Hopman.
Make Sure to Have a Vision When Preparing for Retirement
If your vision for life after work doesn’t perfectly match your partner’s, then that’s all right. You’re a team, but you’re not the same person. According to The Hopman Group’s Marie Gooch, “It’s okay to have individual activities and likes, but you need to have a combined vision on the big things. Where are you going to live, how often are you going to travel.” Essentially, it’s important to come to an agreement on these things whenever you’re preparing for retirement.
Further, this vision is something that you should also be discussing with your financial advisor. Marie recommends always remember that “the retirement vision is important to talk about, and you should have an advisor that is willing to initiate that conversation, or at least be willing to have that conversation with you.”
Why Is a Vision So Important, and How Do You Determine Yours?
So, does this “vision” for retirement actually affect the financial strategy you’ll need to take? In a number of ways, yes, it does. Marie suggests that, before all else, you should begin with the question: “What are my core values?”
For instance, if your retirement value is family or service:
- How often do you see yourself traveling to see your children and your grandchildren?
- Would you like to leave a legacy?
- Do you want to have something left at the end of your retirement for your kids and your grandkids?
- Would you like to be saving for your grandkids’ college?
- If one of your values is service to others, do you plan on volunteering in retirement?
- Would you like to give to charity?
- Would you like to leave a charitable legacy?
Starting around these values can help us fill in whether you want to volunteer or give to charity.”
Once you’ve firmly established your values, it’s time to move on to assessing how your current profession provides you with the four Ps (paycheck, people, place, purpose), and determining how you can retain those “Ps” in retirement. For example, it won’t be easy to enjoy your retirement if you feel that you’ve lost your purpose. Most people rely on their job to supply their life with these “Ps,” meaning that in retirement, you’ll have to find a new route to acquiring them. Once you’ve figured out how to replace these work-sourced variables, along with establishing your core values, you’ll have a clearer idea of how you’ll be spending an average day in retirement. From there, you can begin determining how much income you are going to need to have to live that type of lifestyle.
What If You Have a Different Vision?
What if you have a different vision for retirement, compared to your partner? Marie explains that “Whether it’s bringing up children or running a household, it takes open communication and it takes a willingness to compromise. You both need a willingness to accept that the other person may have needs that are different than yours. Both of you need to be talking through how those needs can be met.”
Make sure you remain open with each other, throughout the entire retirement planning process. Ultimately, “it’s just about communication and compromise. That really is the basis of marriage and coupledom throughout your life,” says Marie.
Should You and Your Partner Retire Together?
Worried about whether you and your partner should retire together? Fortunately, as Marie reminds us, “Nothing says you have to retire at the same time.” If you don’t see a reason to stop working quite yet, even if your partner has decided to retire, then don’t feel obligated to immediately follow their lead. In fact, when you decide to retire together, Marie says that “there’s more planning that needs to go into that retirement planning on the financial side because we’re cutting off years of income and social security.” In some cases, retiring at different times might be the more practical option.
The Importance of Staying Active in Retirement
Another key aspect to a fruitful and happy retirement is maintaining an active lifestyle. These sorts of activities can help you to fulfill some of the aforementioned Ps, whether it’s due to socialization (such as with a group exercise class) or keeping yourself fit. If you can, try finding a way to do these physical activities with your partner. Marie reminds, “It’s an activity you’re doing together, but fulfilling that really important need to stay healthy.”
Planning these activities is also a great opportunity to set up a schedule for your day-to-day routine. After all, according to Pam, “You’re probably already making time most days to eat a meal or catch a TV show. So why not set a fixed time into your daily schedule for exercising?”
At the end of the day, preparing for retirement shouldn’t be solely focused on finances. It’s important to see the whole picture. It’s not just about money when you retire, it’s about other quality of life factors as well.
If you’re interested in hiring a financial service professional to aid you and your partner in preparing for retirement, get in touch with The Hopman Group. Our team of experienced advisors knows exactly how to guide you through this overwhelming process, supplying you with innovative financial strategies and solutions, tailored to your own retirement goals.