Will You Work In Retirement? Avoid These 5 Common Mistakes

Posted: Dec 20 2013, 9:26am CST | by , in News

Will You Work In Retirement? Avoid These 5 Common Mistakes
Photo Credit: Forbes

“I will never retire.”

“I will work until I die.”

These are statements I hear often from many of my 50-year-old clients—and frankly, from some of my closest friends, too. Baby boomers lack confidence in their ability to retire, and many are afraid of the unexpected: An Associated Press – NORC Center for Public Affairs Research poll found that 82% of working Americans over the age of 50 said it is at least somewhat likely that they will work for pay in retirement.

When we think about retirement, the first thing that comes to mind is how we’ll fund it. That’s natural; after all, you’ll be going from relying on a salary to relying on your personal investments. But retirement is not just about money; it’s also about your desire for freedom. Retired people have the ability (or should, at least) to do what they want, when they want. This should be just as valuable as the income factor. And if working is part of that flexibility or larger game plan, then you should feel good about it. You shouldn’t have to feel as if you’re “working until you die.”

Of course, that doesn’t mean working longer won’t be due to a financial need of some sort. For example, more than three in five pre-retirees say they are “terrified” of what health care costs may do to their retirement plans, according to a recent Nationwide Financial survey. But whether the cause is to pay for rising health care costs or some other harsh reality, working doesn’t have to mean people stop enjoying themselves. Working longer than originally expected can be a great transition to “full” retirement if planned properly.

Here are five mistakes I’ve seen 50-somethings make when planning a working retirement:

1. They assume they will never be able to retire. Respondents to an October 2013 Wells Fargo study of middle class Americans feared they would have to work well into the twilight of their lives, but only 29% had a written retirement plan. The truth is, unless you doublecheck, you can’t assume that you aren’t on track for retirement. You just might surprise yourself.

My tip: Call in the experts and draft a written retirement plan. Visit the CFP Board’s LetsMakeaPlan.org, or check out one of our plans at LearnVest.com (use my discount code RETIRE50).

2. They stay in the same place. If you plan on continuing to work, why not move to the place you’d love to live or where you can live inexpensively? A change of scenery could energize your outlook on working longer. Two years ago, I moved from northern California to my condo in Park City, Utah. Though I clock in quite a few hours at work, I get to enjoy the beauty of Park City on my days off and can gaze at the mountains on my lunchtime walks every day.

My tip: See if it’s possible to transfer through your existing employer to your desired location, or find a new job where you want to live. See Best Places for a Working Retirement by Forbes contributor William Barrett for suggestions on where to make the move.

3. They only have work friends. When you have a working retirement, you have one foot in work and one foot in retirement. Cultivate friendships outside of work so you are moving “toward retirement” instead of “away from work.” In fact, the quickest way to find out who your true friends at work are is to leave. Take note of how many of your co-workers keep up with former colleagues who have left or retired. Many times work friendships are just work-focused, so it’s natural for friendships to wane when someone leaves.

My tip: Find a local club or interest group in your town and get involved in it so you can meet people from all walks of life.

4. They get in a nine-to-five rut. If you want to enjoy a working retirement, consider changing up your schedule so you are available when your retired friends are. For example, when I moved to Park City, I only knew one other person besides my husband. So I started playing golf with a group of women who played nine holes on a weekday morning. I switched up my schedule to allow for this by working later on Tuesdays, and was able to connect with both working and retired women in my community. Even though I work the same number of hours, having a flexible schedule gives me the opportunity to interact with a variety of different people.

My tip: See what your potential employer’s flex-time policy is before you accept a job, or propose an alternative work schedule that supports your current employer’s objectives.

5. They work to live, not live to work. You know the saying: When you love what you do, it doesn’t feel like work. In the ideal working retirement, you would feel so excited about the work you do that you wouldn’t feel as if there’s something else you’d rather be doing—and you wouldn’t resent whomever is asking you to do it.

My tip: Volunteer for projects in your company that you are either passionate about or want to become more well-versed in—it can help energize your work life.

Regardless of the reason, working in retirement doesn’t have to seem like drudgery. You just have to do it right.

Nancy L. Anderson, CFP ™ is a fee-only financial planner with LearnVest Planning Services and a blogger for Deer Valley Ski Resort. Company website is LearnVest.com (use code Retire50 for a discount).  Follow Nancy on Facebook – Twitter.

The Best Places For A Working Retirement In 2013

The opinions expressed are those of the author and may not be the views of LearnVest Planning Services LLC (“LVPS”), a registered investment adviser. The advice provided is not personalized investment or tax advice, may not be suitable for your individual situation, are not guarantees of future performance and may differ materially from actual events that occur.  The author and LVPS are not endorsing, sponsoring or responsible for errors or inaccuracies by the unaffiliated third party sources and links identified herein on which the author reasonably relies. 

Source: Forbes

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