How many great and important things in life start with a simple conversation? Consider some of the most important relationships, accomplishments and memories in your life. How many started that simply? Most of them, probably.
Let’s think about this as it relates to retirement.
In my experience building financial plans for clients, the biggest obstacle for most people in making significant life change is not related to their finances. Believe it or not, the biggest barrier is procrastination. The day-to-day demands of their busy lives, families and careers often take precedence over planning for their future. Many are worried or even embarrassed that they haven’t saved enough to support their financial goals. They feel afraid to start the conversation because of what they might find out. I see it all the time, hard-working family stewards pour their energies into raising their families, sending kids to college, helping their parents. And yet they never get around to focusing and planning their own lives. This is noble and instinctive, but it’s a limiting behavior that can keep us from maximizing our lives.
There are lots of hiccups along this path that keep us from initiating change, here are a few of the biggies:
No Clear Path for Change
One of the reasons people put off thinking about a transitional retirement is that they lack clarity about how to do it. For decades, our society has fed us its version of what a “normal life” looks like. If you’re “doing it right,” you go to college, get a job, get married, buy a home, start a family, work 4-5 decades until your pension and/or nest egg allows you to parachute out—eject.
Over time, we learned the myth that retirement is binary – either you’re working or you’re not. Based on what I see with my clients, that is simply not the case.
This is why we’re working so hard to change the way people think about retirement. One of the ways we combat the “traditional” retirement myth is by sharing inspiring stories of people who successfully transition out of the “grind” stage of their career.
Unfortunately, the pathway to this new ideal that we call a Victory Lap is still fuzzy. Over the years, I’ve seen countless clients and friends shrug their shoulders and decide it will be easier to “stick it out” at their current job in lieu of doing the work to change course. They decide to put their head down and keep working, hoping that in a few years the answer will manifest itself. Maybe their employer will come to the table with a massive severance package or they’ll buy a winning lottery ticket.
Of course, this doesn’t lend itself to a successful Victory Lap. Hope, as they say, is not a strategy. The longer you wait, the less likely it is that you will be able to implement something different than what the Corp has in mind for you. As Mike often says, you have to start digging your own escape tunnel.
Planning Vacations or Planning Your Life
We often say that people spend more time planning their vacation than they do planning their own lives. It may sound absurd in those terms, but it’s true. We tend to focus on short-term payoffs at the expense of long-term gains.
My wife and I do some of our life planning through discussions during long road trips. With busy schedules and the rest of our family running in many directions, car and plane trips end up being our best time to think about and discuss our 5-year, 10-year and 20+ year plans. I guess you could say that we plan our lives while we’re ON vacation.
Looking back, I can see how these talks became the catalyst for realizing our goals. We have developed a shared vision and continue to tweak and adjust it as time goes by. Without that clarity, planning the specifics and laying the groundwork for change is tough.
Do you have a lifestyle plan?
So, where to start? It may sound funny coming from a financial planner, but I recommend lots of daydreaming. Let your mind wander into open space and think deeply about what you yearn to do over the next few decades. Consider your ideal lifestyle. What does it look like? Where does it take place? What will you spend your time doing? What do you value most in this next chapter of your life?
Pondering these questions may not reveal all of the answers. After some thinking, you might wonder if a Victory Lap is even feasible. But it’s about starting the conversation, which gives purpose and perhaps urgency to the exercise.
Once you clarify your vision, you can progress to the next steps in the process – determining your financial readiness and possibly or taking your work in Victory Lap for a test drive. The path to your Victory Lap might have some twists and turns, but never fear, the journey will no doubt be more exciting than your typical drive down a four-lane interstate.
I’m excited to start a conversation with this community and hope that more people start their own conversation soon. Life is waiting!