Why Is It Normal For You To Worry About Retirement Before You Retire?
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Loading... - Adam Kelly
- 23 May 2022
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The clock is ticking towards your final day on the job. On the other side sits the promise of a proverbial pot of gold at the end of the rainbow.
Or so you have always been told. And you’ve always believed retirement would be just that.
If that’s all true, why are you so anxious?
“Change is inevitably hard for everyone, and the shift from working to not working is huge!” says Wes Moss, Managing Partner and Chief Investment Strategist at Capital Investment Advisors in Atlanta. “For many people, they’ve been working since they were in their teens, and they know how to manage a steady incoming stream of income. We’re talking about decades of consistent habits and lifestyle. From a human and psychological level, the transition will nearly always create anxiety. Will I run out of money once there are no more paychecks? What will my purpose be once my career and steady work income stop? So, it’s completely understandable that the transition will create worry.”
Worry comes in many flavors. It exists for many reasons. As you might imagine, money stands as the taproot of this fear. The funny thing, though, is that money may merely be a symptom, or at the very least a metaphor for the real problem.
Yes, Money, But That’s Only A Start
It’s always hard to talk about money. Because you don’t talk about it, you leave yourself vulnerable to uncertainty surrounding your continued financial viability, especially in retirement. Why is this so?
“Most people are nervous about retirement (and market volatility) because they don’t have a clear financial plan that includes good and bad markets, inflation and what-ifs,” says Jim Pratt-Heaney of Coastal Bridge Advisors in Westport, Connecticut.
Without sufficient planning, it’s extremely hard to have a firm grasp on where you stand in terms of finances. This leaves you susceptible to worst-case scenario thinking. You’re consumed by the thought of running out of money.
“Often, people don’t think they have ‘enough’ money,” says Christopher J, Mackin, Partner and Wealth Advisor at Bleakley Financial Group in Boca Raton, Florida. “It comes from a common scarcity of money mindset where people focus on what is lacking versus how to grow. Shifting this mindset begins with having a plan for your money.”
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One of the main reasons you’re concerned about running out of money is you simply don’t know what the future holds. Failing to plan what that future looks like only compounds the problem.
“Perhaps the biggest concern is whether you can afford that new lifestyle,” says Mark Schrader, TIAA Financial Planning Thought Leader located in Charlotte, North Carolina. “TIAA did a Financial Wellness Survey earlier this year, and we found fewer than 30% of Americans feel confident they’re on track with retirement savings to retire when they want, afford the lifestyle they want in retirement or live comfortably throughout retirement without running out of money.”
But there’s something more going on than just worrying about money. First, money involves a lot of things. It may seem like it can solve almost everything, but it may not. Think about those things that affect you most emotionally. Can money buy you true happiness when it comes to those things?
“Initially people seem most worried about whether or not they will have enough saved to have a comfortable retirement, where they can take care of themselves and not place any financial burden on their children,” says Matthew Grishman, Principal at the Gebhardt Group, Inc. in Roseville, California. “Quite often, even when people know they have enough, they still worry about retirement. Recently, I have noticed more people are willing to be vulnerable and discuss this openly.”
And when they start talking, they start asking this question:
What Do I Do Now?
You hear people talk about going from “zero to sixty” as a thrilling sense of accomplishment. Imagine what going from “sixty to zero” connotes. Now you’re beginning to get an idea of what people are so anxious about as they set foot through the door of retirement.
“Many of us started working in our teens with babysitting or paper routes; we’ve built up a lot of momentum towards getting up and going to work,” says Warren Ward, Senior Planner at WWA Planning and Investments in Columbus, Indiana. “If asked to describe ‘who they are’ without being able to state ‘what they do,’ they are at a loss. It’s this transition from being busy all the time at something they are known to be good at to having nothing required of them that is at the heart of the anxiety.”
But, again, there’s more to this condition than meets the eye. It’s not just that a void exists where substance once filled it. There was also an inherent structure to that substance. And, unless you were a solo entrepreneur, there was no isolation within that substance.
Retirement is different. No one is there to look over your shoulder, tell you what to do, and measure your progress. In short, in retirement, you are an entrepreneur. You set your schedule, you define your goals, and you determine if you’ve met those goals. Read More...
