Who knows retirement better than those that have already retired.
Today, you can find a survey or a study for just about anything. When it comes to surveys about retirement, most surveys look at people who are still approaching the day when they leave work and head into the so called golden years.
A recent American study by Lincoln Long Life Institute, asked adults in their 60's and 70s — with several years of retirement under their belts and annual income of at least $75,000 — what advice they would share with their children about later life. Who better to ask about retirement tips than retirees themselves? Here's a few tips from this study.
Start planning and the earlier the better
When asked to identify the most important financial advice they would give baby boomers, the largest group said to develop a retirement plan as soon as possible.
Although most of the retirees (89%) think they did a “good” or “excellent” job, they had two concerns: 54% said they never considered how many years they would spend in retirement, and only 26% said they are well-prepared for changes in inflation, stock markets, interest rates and other variables. According to the survey, the biggest fear for retirees is the fear of outlasting their money.
Retirement has been described as the last third of your life after the learning years and the working years. Two distinct trends could make retirement the longest phase of your life: early retirement and longer life expectancy. This study suggests that you plan for 35 years in retirement.
Work in retirement
In my mind the change in retirement from the past is that more and more retirees will work in retirement. More and more researchers suggest that “retirement” and “work” are no longer mutually exclusive. According to the study, 33% of retirees are still working. Of those, about two-thirds never retired; the other third decided to rejoin the work force and took a new job.
Why are more and more retirees choosing to work in retirement? According to the study, the top three reasons given for working are:
- income needs
- intellectual stimulation
Retirement is no longer about the end of a paycheque. In fact, 95% of those surveyed said that the biggest source of satisfaction in their lives is the ability to remain independent. Working can help some remain in control of their lives.
Survey participants define independence not only as being financially secure, but staying healthy.
When asked to name the most important piece of advice not tied to finances that they would give baby boomers, 50% of 70-year-olds urged the younger generation to keep active and maintain a healthy lifestyle.
Make sure you take the time to exercise, eat better and get frequent checkups. Money won't mean a lot if you do not have the health to enjoy it.
It was not too surprising to find that successful retirees place a great importance on their family relationships. When planning for retirement, make sure you take into account the general importance of family and other social relationships. 83% of those surveyed said the respect of family and friends was extremely important.
Other studies have shown that having a solid social support is a key to a happy retirement. The key is to have deep meaningful relationships as opposed to a wide network of acquaintances. Men tend to rely too much on their spouses in retirement. Women tend to have a better social network and a better relationship with their children.
Be aware of the sandwich generation
The retiree today has a high incidence of having to take care of both dependent parents and also adult children. In fact, 94% of those surveyed with at least one living parent (or in law) were either heavy contributors or sole financial supporters to their elders. At the same time, nearly all (95%) reported that they provide at least a modest amount of financial support to one or more children. Overall, 62% of all retirees over the age of 60 provide significant financial support to either a parent or child.
According to the study, retirees suggest that people incorporate some form of Long Term Care planning. Long term care planning helps individuals to be more independent in their choices and be less of a burden on their children. In the group of retirees, only 34% had some form of long term care insurance. Here in Canada, very few people have incorporated long term care planning in their retirement plans.
If you are preparing for retirement, listen to the experts and be sure to plan ahead. No matter what, it's never too late to start. As you can see, successful retirement is not just about money. Money is important but so are social relationships, health, activities and self-confidence. Good luck in your path towards a happy, healthy and wealthy retirement.