3 questions to help discover if you’re ready for retirement

Portrait of a middle aged woman thinking about being ready for retirement

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Are You Ready for Retirement? That’s a question investor advisor Ken Heise asks. ‘Retirement is a huge transition,’ he says, ‘much like getting married or having kids. And just like those other life events, it takes preparation.’

He suggests there are three questions you need to ask to help you discover if you’re ready or not. And, as a financial professional, he admits that they tend to focus all their attention on ‘the money side of things’.

‘But the people who are typically the most successful in retirement think beyond the bottom line to the other changes and challenges they might struggle with in their new lives’.

Question 1: Am I mentally ready?

Work gives you ‘a paycheque and purpose’ and retirement means you’re about to become unemployed. Are you ready for it? A study by the London-based Institute of Economic Affairs says that the likelihood of suffering from depression goes up by about 40 per cent after retiring.

‘In large part,’ says the report, ‘that’s because work, whether we realise it or not, provides many of the ingredients that fuel happiness, including social connections, a steady routine, and a sense of purpose’.

Retiring takes you out of your workplace. That’s where you probably find the people you currently mix with most—and may have for years. What plans do you have to fill those relationships? What plans do you have that will continue to give your life purpose?

‘How will you replace those things?’ is the question Heise asks.

Question 2: Am I physically ready?

This is about how active you are. There’s evidence that people become less active when they retire unless they make a definite decision and act on keeping fit.

Obviously, beginning a health regime before retirement means you can make it part of your life in retirement. One of the simple ways—and it’s also one of the best ways according to various experts—is to make sure you walk a minimum of 10,000 steps a day.

I’ve had a counter on my wrist for about 10 years now and know it isn’t hard to walk 10,000 steps a day, but you do have to be consistent to make it happen. For me, it’s helped by having a treadmill at home where I can add to my steps when the weather is bad.

I interviewed Dr Darren Morton, director of the Lifestyle Research Centre at Avondale College of Higher Education, when writing Retirement Ready? and he kept it simple. ‘The two foundational pillars of health are diet and physical activity,’ he said.

There’s plenty of information available about how to work on both. The bottom line is that it’s worth getting healthy for retirement and staying healthy in retirement, even if it’s an effort at first.

Question 3: Am I financially ready?

‘Money is the thing many people think most about when it comes to retirement planning,’ says Heise, ‘but they don’t always follow through on the preparation’.

His tips:

  • Understand how much you expect you’ll need to live your retirement dream.
  • Work out your income during retirement.
  • Is there a shortfall? What will you have to do to make it up?
  • Spend a year living on your suspected retirement budget while still working.
  • Get a firm handle on debt.
  • Don’t retire too soon. Would another year or so of work be a problem?
  • Consult with a financial professional to help you understand your financial options.
  • Be wary of splurges in the first year or two of retirement.

The final word

Heise says, ‘By taking a holistic and proactive approach, you’ll be giving yourself a better shot at being happy and healthy in your golden years. Don’t … base your future on hope. Figure out what your retirement dream is, and go get it!’

Bruce Manners: the author of Retirement Ready?, Refusing to Retire, and founder of RetireNotes.com

Category: Physical Health, Planning, Retirement

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