As you look ahead to your retirement, you’ve probably thought about important factors like how much income you’ll have, how long your savings will last, and whether you’ll be able to stay in your home. But have you ever stopped to think about what type of retiree you’ll be? It may seem like an odd question, but the more we consider it, the more relevant that question becomes. This article published late last year on the Kiplinger financial website identifies nine different types of retirees. As you read through this list, which one do you identify with?
Nine Types of Retirees: Everyone’s Experience is Different
“Everyone’s experience in retirement is unique,” say the Kiplinger authors. “But there are some characterizations we can draw from data collected in various surveys and studies of retirees. Put together they form the nine types of people you’ll encounter throughout your later years.” No matter what type you resemble, the article suggests, you can learn from the example of other people – some positive, others not so much.
As the article says, “Some [types] offer attributes you may want to adopt, and others you are best to avoid. They all, however, can provide lessons on how to live a fulfilling retirement.”
Type Number One: The Tireless Mover
According to Kiplinger, this retiree “is always on the go, with a bucket list that is seemingly as long as a CVS receipt.” The Tireless Mover appears to fill every day with classes, appointments, and get-togethers with friends. “On the weekends, this person is trying to skydive for the first time or seeing the Rolling Stones for the 100th time.” In other words, the Tireless Mover never seems to slow down.
What lessons can this on-the-go retiree teach everyone else? “To remain active as you grow older, you need to live a healthy lifestyle,” says the article. “Studies have proved that exercise and a healthy diet increase energy levels and boost your immune system.” That may be true, but most of us would probably find a non-stop, on-the-go retirement exhausting. Our advice for the Tireless Mover is, “Pace yourself!”
Type Number Two: The Lost
“Not everyone has a smooth transition into retirement,” says Kiplinger. Research has shown that retirement triggers anxiety, depression and debilitating feelings of loss in some people. Besides focusing on money when planning for retirement, “It’s important to also plan for the social and psychological shifts, such as coping with the loss of your career identity, forming new relationships and finding things to do to pass the time.”
The Kiplinger piece suggests that the best way to avoid feeling lost in retirement is to “build a financial plan around [your] goals and what makes [you] truly happy in life.” The article also recommends giving retirement “a test drive by gradually reducing your work hours, if possible, as you near your retirement date.” We’re not sure these solutions will work by themselves, but they’re worth a try.
Type Number Three: The Workhorse
There are those who keep on working after retirement age because they have to (see Type Number Nine below), but many retirees stay on the job as a matter of choice. These “workhorses” aren’t working just for the paycheck. One survey cited by Kiplinger found that roughly one older worker in six is working solely because they want to, not because they need to. “In fact,” the article says, “many people see retirement not as a time to rest and relax but to realize their dreams of becoming an entrepreneur.” Research has shown that one-quarter of new entrepreneurs are 55 to 64 years old.
“Though certainly not for everyone, work can provide meaning and a sense of purpose in retirement,” says Kiplinger. Work also offers proven physical and mental health benefits. But there are financial implications to consider if you choose to keep earning a paycheck: your salary might reduce your Social Security benefit and raise your income tax rate. Be advised.
Type Number Four: The Lonely
Loneliness affects as many as one-third of seniors, studies have shown, especially now during the COVID-19 pandemic. “Retirement can be a period of serenity and fulfillment, but for some it can be quite lonely,” warns Kiplinger. Living with loneliness has a negative impact on a retiree’s physical and mental health and can shorten life expectancy. The good news: loneliness can be cured, at least for most people, through meaningful social contact, such as volunteering or cultivating friendships. In any case, this is a good reminder for all of us to be alert for signs of loneliness among those we know.
Type Number Five: The Globetrotter
For a high percentage of retirees, travel tops the list of preferred activities. “If you want to spend most of your retirement on the road,” Kiplinger advises, “plan ahead for the special challenges that come along the way, especially when traveling overseas.” Make sure you have easy, low cost access to your money, for example. Most importantly, make sure your health needs are covered: many American health insurance plans, including Medicare, stop at the U.S. border. Also, travel is expensive, so you’ll need to plan carefully and get sound financial advice to make sure you can afford all those trips to exotic destinations.
Type Number Six: The Reluctant Spender
“Although retirement is often portrayed as the time to live life to the fullest, the attitude of many retirees is quite different,” Kiplinger observes. “After saving all their lives, they are reluctant to spend money, even on their retirement goals.” Surveys have revealed that up to half of retired respondents are afraid to use their savings, fearful about medical costs, unexpected expenses, and a volatile stock market.
“These fears highlight the importance of having a retirement plan you are confident in,” says the article. “That way, you’ll know what reasonable amount you can spend to live a comfortable retirement — guilt free.” We think a financial dashboard can be a powerful tool to allow you to adjust your spending with greater confidence. If this idea is of interest, we’ll be happy to refer you to a qualified, objective financial planner who can guide you.
Type Number Seven: The Superhero
Two-thirds of retirees say they’ve found retirement to be the best time in life to give back through volunteering, according to an Age Wave/Merrill Lynch study cited in the Kiplinger article. Volunteering is a proven way to make a positive impact on a retiree’s well-being, which is why some retirees you’ll meet can’t get enough of it. “Those who donate money or volunteer feel a stronger sense of purpose and self-esteem and are happier and healthier,” the article says, suggesting more retirees might want to consider volunteering as a top retirement goal.
Type Number Eight: The Overly Generous
Being generous can have a downside. “Some parents and grandparents can’t help themselves,” Kiplinger warns. “They’ll generously help a child or grandchild, even under the constraints of a limited income in retirement.” Surveys have shown that nearly 40 percent of empty nesters are still supporting their adult children at least to some degree, with an average per-child monthly spending of $254.
As the article states, generosity may be admirable, but “your savings are earmarked for a specific purpose: to help you support yourself for 20 to 30 years in retirement.” Young adults today may face a host of financial challenges, from student loan debt to pandemic-caused financial upheaval, but retirees have to be prudent. “You don’t have to completely financially cut off your offspring, but you should set some limits.”
Type Number Nine: The Never Retired
“We talked about those who work in retirement because they want to,” says Kiplinger. “Now, we must mention those who need to work for financial reasons.” According to a 2019 Northwestern Mutual study, about one baby boomer in six has $5,000 or less saved for retirement. More than half of the respondents to AARP’s Life Reimagined survey plan to work past age 65 and over ten percent expect to keep working more or less indefinitely.
The harsh reality, however, is that health problems and limited job opportunities will likely conspire to derail the plans of many aging seniors. The take-away is stark but simple: try to avoid putting yourself in the predicament of “forced labor” as you age. A solid LifePlan from AgingOptions is a great place to start.
Announcing Seminars with a Choice: In-Person Events Return, Webinars Also Available
For several months our popular LifePlanning Seminars with Rajiv Nagaich have been offered online only. But now as COVID-19 restrictions are starting to be eased, we AgingOptions are excited to announce a new series of in-person seminars coming soon. For now Rajiv will only be offering in-person events in communities where gatherings are permitted under the governor’s phased reopening plan. Of course, these events will be conducted in a way that’s consistent with all health guidelines.
Our chief desire is to help you prepare for the kind of retirement you’ve always dreamed of having. LifePlanning is a powerful process that combines financial planning with a housing strategy, a medical plan, a legal foundation plus a plan to involve your loved ones in all aspects of the choices you make as you age. With finances, housing, medical, legal and family all working together, you have a fully integrated LifePlan.
Because of health safeguards, enrollment at our upcoming in-person seminars will be strictly limited. We urge you to visit our Events Page and register now for the LifePlanning Seminar that works for you. Also, as we said above, Rajiv continues to offer his free LifePlanning Seminars in the form of webinars that you can watch conveniently at home. You’ll find a calendar and other important links here on our AgingOptions website.
Reliable information has never been more important – online or in person! That’s our promise to you at AgingOptions. Age on!
(originally reported at www.kiplinger.com)