How to Assess if You’re Mentally Prepared for Retirement

We all know that successful preparation for retirement from a financial perspective (or lack thereof) plays a significant role in the ability to enjoy one’s golden years. However, another less-buzzworthy retirement equation component is often just as imposing: mental preparation.

Many new retirees are surprised to learn that in addition to a lot more time on their hands, they also face adverse psychological effects they hadn’t anticipated such as depression, anxiety, and declines in physical health. Likewise, it’s estimated that approximately 25% of retirees experience isolation and a lack of direction.

In our quest to help make the transition to the softer side of retirement a bit smoother, we’ve identified six questions for you to ponder before wading into these brand-new waters.

Do you have a shared vision for your retirement?

Thinking about where you and your significant other want to live during retirement is a good start. U.S. News & World Report publishes an annual “Best Places to Retire” study based on various factors including taxes, affordable housing, happiness ratings, and desirability: an excellent place to begin if you’re unsure about where to spend your golden years.

Should you both envision yourselves residing someplace new, consider renting before you buy as a practical experiment—especially important if these new environs are far away from friends and family or you haven’t previously lived there. As a worst-case scenario, should you both find yourselves unhappy in this new locale, you’ll enjoy the ability to pivot more quickly and with less hassle given no need to sell a home.

After deciding where to live, figure out what you plan to do with your newfound freedom. You’ll hear from many retirees that retirement, in itself, is sometimes boring. Exploring new hobbies helps. Have you always wanted to cook? Learn to play chess? Take piano lessons? Beyond popular pastimes such as these, volunteering is also a great way to get out of the house and into the world during retirement—and can profoundly impact happiness. Regardless of your decision, the goal is to find new, interesting activities to fill your time while putting your mind and body to work: pinpointing pursuits that inspire you and give you a fresh sense of purpose.

Will your significant other work while you are retired?

Another conversation with your significant other is whether you’ll retire at different times, thus avoiding any potential tension before it arises. Basic activities such as getting out of bed at the same time every day (versus one spouse always sleeping in), assigning household chores, and staying occupied and not feeling trapped at home while your spouse works are significant factors involved in maintaining a healthy relationship.

How do you feel about leaving the workforce?

If you’re like many retirees, initial thoughts of retirement may excite you: replete with all the time you’ll have to take those dream vacations you’ve placed on the back burner for so long and tackle time-consuming projects put off due to your work schedule. However, at some point, this honeymoon phase (typically lasting a few months post-retirement) will end once the projects wrap up and you realize there’s only so much traveling one can do (and finance!).

Consequently, it’s common for retirees to report several emotional changes in the first years after retirement (e.g., feelings of inadequacy or a loss of identity). These sentiments hold particularly true for people whose lives revolved heavily around their careers. Given that many friendships arise and are nurtured in the workplace, feelings of loneliness are also prevalent.

For some soon-to-be retirees, perhaps a slower transition to retirement makes the most sense: such as reducing your hours over time rather than doing so abruptly. In this way, you can ease into this new phase and identify passions outside of work.

How will you strengthen your relationships?

Strong interpersonal relationships are chock full of numerous benefits, with Harvard research revealing that socially connected people are happier, healthier, and live longer than their less-social peers.

Isolation, however, can yield devastating effects such as a decline in brain function and a shorter life span. According to Dan Buettner, author of Blue Zones—a book dedicated to uncovering the secrets of longevity—loneliness has the potential to shave eight years off your life. It’s therefore imperative to stay socially engaged with those closest to you.

How active will you be in retirement?

If you find yourself watching more TV as you get older, you’re not alone. Statista states that the more you age, the more time you spend engaging in this activity. The biggest culprits are those aged 65+, with this age group spending, on average, more than four hours a day in front of the television!

Living a sedentary lifestyle, however, is associated with inferior health outcomes including heart disease, Type 2 diabetes, and cancer. Moreover, deteriorating health conditions can also negatively impact your wallet given additional prescriptions, co-pays, and perhaps even commuting expenses related to treatment.

According to various sources including WebMD, just 30 minutes of daily activity that gets your heart going and blood pumping (such as a brisk walk) can lower your blood pressure, keep your bones, muscles, and joints healthy, ease symptoms of depression or anxiety, reduce your heart disease risk, and help you better manage chronic conditions such as diabetes and arthritis.

The bottom line is that the more active you are, the greater the chance you’ll stay healthy during retirement.

Are you aligned with your financial advisor?

As your goals change during retirement, it's important to regularly consult with your financial advisor to ensure your retirement plan syncs up with your financial needs. With shifts such as a desire to travel more than you initially planned or an interest in relocating to a more expensive area impacting your long-term finances, be sure to stay in touch with your advisor to help minimize financial stress.

In sum: final thoughts on mentally preparing for retirement

Retirement can arrive sooner than you plan for, with one recent Federal Reserve economic wellbeing report stating 45% of surveyed retirees were forced into retirement due to health issues (29%), the need to care for a family member (15%), or a lack of work (11%): numbers revealing that retirement sometimes arrives sooner than expected. It's therefore critical to prepare financially but also equip yourself to address the psychological and emotional aspects discussed herein.

Want to know if you’re on-track for retirement? Schedule a FREE discovery call with one of our CFP® professionals to find out.

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Vision Retirement is an independent registered advisor (RIA) firm headquartered in Ridgewood, New Jersey. Launched in 2006 to better help people prepare for retirement and feel more confident in their decision-making, our firm’s mission is to provide clients with clarity and guidance so they can enjoy a comfortable and stress-free retirement. To schedule a no-obligation consultation with one of our financial advisors, please click here.

Disclosures:
This document is a summary only and is not intended to provide specific advice or recommendations for any individual or business.