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Retirement is often a milestone that’s eagerly anticipated. Many of us think about handing our notice in for the last time, having more free time to do what we like and simply relaxing. However, the reality doesn’t always live up to expectations and many don’t want to ‘retire’ in the traditional sense.
When you think about retirement you might imagine travelling more, spending time with grandchildren or putting your feet up with a coffee and a good book. It’s not surprising it’s often viewed as something to look forward to. However, research suggests that the novelty can quickly wear off. Without work providing structure and a career path providing goals, some retirees find themselves facing an existential crisis just months into retirement.
Speaking to the BBC, Harvard Business School professor Teresa Amabile said: “People think of planning for retirement as a financial exercise, and that’s all. It also needs to be a psychological and relationship exercise as well.
“We need to think about who we will be – who we want to be when our formal career ends. The people in our study who do that, tend to have a smoother transition.”
One of the interesting parts of the research highlights just how much our careers define us. When asked to describe themselves, people often replied that they were a ‘retired librarian’ or ‘retired research chemist’. For many people, work plays a role in how we see ourselves and how fulfilling life is. As a result, when you leave that behind, you can feel at a loose end.
Creating a ‘retirement’ that suits you
Of course, just because you don’t want to embrace a traditional retirement, doesn’t mean you want to continue along the same career path either. Perhaps you want to have more free time on your hands, learn a new skill or hold a position that benefits your local community. Luckily, there are other ways of maintaining some of the structure, social benefits and other advantages of the working world you may enjoy whilst creating the work-life balance that you want.
The most common way of achieving this is through phased retirement, where you slowly cut back on the hours and responsibilities you’re committed to at work. This may mean working part-time or having greater flexibility where and when you work for example. But there are other routes there too, including these three:
During your working life, you’ll have gathered skills, knowledge and expertise that could be invaluable to a young professional starting their career. Taking a mentoring role, from helping those entering the workforce find the right positions for them, through to providing support to start-ups businesses, there are plenty of opportunities out there. Networking and mentoring communities are great places to start if this is something that appeals to you. Mentorsme is just one example of a platform that connects free and paid-for mentors with those seeking experience.
If you’re in a good financial position, you may want to dedicate some of your free time in retirement to volunteering. Whether you choose a charity that provides support at a local, national or international level, you can benefit from the feel-good factor of knowing you’ve given back. The great thing about volunteering is that roles are often flexible and there are so many opportunities out there for you to find the right position. Whether you want to volunteer occasionally during big events or on a regular basis, it can help give your life some of the structure it had when you were working.
3. Working for yourself
Have you always wanted to work for yourself? Retirement could be the perfect time to pursue that dream. Thanks to technology, it’s easier than ever before to reach an audience and turn entrepreneurship dreams into a reality. You could use your skills gained through work to freelance or you may have a business idea in the back of your mind. Working for yourself puts you in control of getting the work-life balance right. Plus, potential earnings can boost your pension and savings even further.
Incorporating your financial position
Whatever your reasons for maintaining some form of work structure, it’s important to consider your finances.
- Do you have the financial security to give up work?
- Would some additional income allow you to live the retirement lifestyle you’ve been looking forward to?
- Will your decision impact your future financial security?
Money shouldn’t be the only focus when you’re making retirement decisions. However, you do need to keep in mind that your pension is likely to need to provide an income for the rest of your life. Choosing to leave work earlier than anticipated to pursue volunteering opportunities, for example, may mean your later life finances aren’t as expected. Alternatively, when assessing your financial provisions, you may find you’re in a better position than thought and choose to ‘retire’ sooner than anticipated.
Financial planning can help you bring together your financial provisions with your goals, giving you the confidence to retire in a way that suits you. If you’re planning your retirement now, whether traditional or not, please get in touch.