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The Paradox of Retirement

GDA partner Wile Consulting Group - UBS offers tips for retirement planning.
Retirees face opportunities and challenges. Optimistically, many individuals and families see retirement as an opportunity to do everything that they never had time to do while working. However, many families also have to confront the loss of purpose and social connections that working provides.

Retirement is a drastic lifestyle change. Researchers have found that any extreme lifestyle change creates stress. In fact, according to the “life events scale,” which is frequently used by psychologists, retirement is one of the most stressful events that you’ll experience in life. So it’s not surprising that so many investors are apprehensive about their decision to retire.

As investors approach retirement, it’s important to have a goals-based plan in place. Only 40% of investors have a retirement plan, and not knowing what you want to accomplish in retirement only serves to make the underlying stress more severe.

Here’s a simple strategy to start that process!

Step 1: Think deliberately
Deliberate thinking requires taking the time to think about options over an
extended period. It’s not practical to develop a lifetime of goals and objectives
in one sitting. Days, weeks, and even months of reflection are necessary.

Step 2: Identify all goals
Identifying all goals and objectives is crucial as they provide a foundation for
sound decision-making and planning for the future, yet research on goals
development indicates that individuals miss nearly half of their goals. Use
categories of goals to kick-start the process.

Step 3: Plan for the unexpected
One way of preparing for a range of possible future scenarios is to evaluate
multiple future versions of your life. These narratives can help uncover
opportunities and risks that might otherwise be overlooked.

Step 4: Learn from others
One good way to improve our ability to predict what we might value in
the future is to learn from the experience of others who have already been
through a certain stage in life. Talk to someone who has already been through
retirement about the experience.

Step 5: Prioritize
Trade-offs are a necessary part of the planning process. It’s better to prioritize
now than to be disappointed later.