Time is probably the most precious commodity that we have. Over the years, as my career as a financial planner unfolds, I have become borderline obsessed with the idea of optimization. How do we optimize? It’s part of my work as I think about the best way to optimize portfolios and help clients accelerate themselves toward a footing of financial independence.

My clients often ask me, “How soon can I retire?” But as I think more deeply about the question, what they are really asking is, “When will I be able to do what I want to do?” Retirement is more than a transition from working to not working because the end game is more about clients having the freedom to work on their own terms. This conclusion begs the question: What if you could do these things five years sooner? What would that be worth to you and your family?

Realizing Our Future Plans Five Years Sooner

We’ve all been touched in some way by a story of a family member or friend who retired after a long, hard career with big plans only to see them get interrupted by a health care issue, early death or the need to care for an ailing spouse. We never know how much time we have and as a self-proclaimed optimizer, I continue to be compelled by the question—What if we could do things five years sooner? What if we could take advantage five years sooner?

This unfolding discussion has caused me to think of all of the people I have known who didn’t get the long retirement that they had hoped for. What if they would have started five years sooner? What would that have meant to them and their families?

An Emerging Path to Retirement

But I believe there is a way to do it because I have seen it in my own experience and in my career. I see an emerging path in my clients’ lives and even in my own personal life as I watch my own family members transition into a better working life.

What Is a Victory Lap?

I’ve noticed a growing number of people who are blurring the lines of what used to be well-defined chapters of work and retirement.  They have added a chapter for a transitional career, which usually happens between ages 55 and 65 —I like to think of it as a Victory Lap. The reasons to consider a Victory Lap are too numerous to cover in detail, but suffice it to say the potential for a better work-life balance and all of the benefits that follow is the driving factor for most people. It’s about creating a more flexible bridge from the “rat race” to the golden years. There are many ways that people go about it but from my observation, the process is quite consistent.

Start Early – Plan Your Victory Lap Three to Five Years Out

I can’t emphasize enough the importance of giving yourself three to five years of advance planning and allocating most of the time to finding out what kind of work you’d like to do. If you wait until your present company offers you a year-long severance package, you won’t have enough time to thoroughly go through all of the steps. Investing this time will pay off in the long run and will likely give you five years or more to live the life that puts your priorities first.

Getting Your Financial House in Order

You can’t do anything until you know where you stand financially. It’s critical to understand your current readiness for an interruption, reduction or possible elimination of your income.  Update (or build) your financial plan and run some scenarios to find out how much income you’ll need to recreate for yourself and how long.

Most people embarking on a Victory Lap assume that their income will go down (although that’s not always the case). You’ll want to understand the impact of reduced/eliminated savings and how long you’ll need to keep working. This exercise will help you weigh the requirements and longer-term ramifications to determine how viable a longer-term Victory Lap is for you. More importantly, it should inform the options that you’ll have in selecting what type of work that you’ll do, and how aggressively you’ll need to pursue it.

Evaluating Options

Some clients get stuck in this phase because they have been in their current career so long that they’ve given little thought to a potential departure. Consider starting small by talking to others inside and out of your industry. Consider several options – consulting, teaching, contract work, etc.

Assessing Your Readiness

Once you’re clear on what you want to do, start figuring out how to get from A to B. What will your business plan look like? Do you need any specific credentials or additional education? You may also need to figure out some basics like – Do you need to rent a separate work space or need any equipment or outsourcing? How will you manage the business (invoicing, etc.)? Are you equipped with the skills and contacts to be active in this business right now?

Assembling Your Team

Building a strong team to support you is critical to your success through this transition and beyond. Ask for all kinds of help and do your homework by surveying the experience of others.  Do you have a coach or mentor who has blazed this path before you? Will you partner (formally or informally) with others?

The Test Drive

Taking your idea or plan to market to see if it has traction is key. If permissible, this is where you can do some side work before leaving your employer to try it out. It’s also where you determine the viability of your plan. Will it really work? Maybe many friends or colleagues have said they’ll hire you for consulting or contract work. Can you get your first client signed? If teaching is your thing, try teaching a night class at a community college. If possible, do the test drive before leaving your firm.

Shifting Lanes/Making the Move

Once you’ve proven the concept and potentially gotten an anchor client, it’s time to map out your transition timeline and make the move. If you’ve been at the same job/organization for some time, the transition can take months or longer. All the while, you’re continuing to get things ready, get the word out and prepare yourself to make the move.

I have seen the value for those making the shift – years of more rewarding work, more balance in the work/life spectrum and a better financial outcome for many. The intangible benefits of more time with your family and the sense of achievement from dedicating yourself to meaningful work make this more than worth the effort in my opinion.

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