"Retirement is great. I could have done it sooner" "We travel. Volunteer. Visit family and friends. Have to set the alarm so I have time to get everything done." "Nothing beats it as long as money and health last." These are some comments the author heard while interviewing retirees in 2001.
The votes are in and there's no need for a recount. As the kids would say: Retirement rocks! That was the conclusion of a growing number of surveys, which have found that "older Americans are living longer and living better. Best of all, the vast majority of retirees are content with their lives, with the level of satisfaction rising as they grow older." (Author interviews by John Ingrisano, January 2001.)
You, too, can enjoy the good life when you retire. But it doesn't happen automatically.
Are you on track planning for retirement?
Though not scientific, the following self-quiz can help give you the feel for how you are doing. Answer each question on a scale of 1 through 10 (1 for never or terribly; 10 for always or completely).
- Do I take a proactive approach to maintaining good health? (Examples: Adequate exercise; no tobacco; eating sensibly; maintaining a reasonable weight.) Good health is crucial to enjoying your retirement years.
- Do I enjoy leisure time and have hobbies? Some people like to work. Down time drives them nuts. If you are a workaholic who struggles through weekends, the stress of forced leisure could be painful. If this describes you, start actively cultivating hobbies you can enjoy as you get older. Or, consider semi-retirement, or find a cause into which you can throw your energy. Keep in mind that you don't HAVE to retire!
- Do I like people and enjoy close relationships with family and friends? Maintaining a social network can help you live longer. The author has found many retirees to be socially active, engaging in such pastimes as contact with friends, neighbors, and relatives, or engaging in activities such as going out to a restaurant. Remember that relationships take work. Cultivate them actively.
- Will my major financial obligation be behind me when I retire? For instance, if you are 50, have 20 years to pay on your mortgage, and plan to retire at 65, it may be wise to consider refinancing (if rates are lower), and shortening the term of your mortgage. That way, your mortgage retires when you do. This reduces retirement expenses, and pumps up your net worth, giving you 100% equity in your home.("Home Equity: How to Build It, How to Use It," Third Age. Web site: www.thirdage.com)
- What percentage of my gross income am I saving? Remember, you might want to get out and do things in retirement, not just sit home and watch the grass grow. Give yourself one point for each percentage you save, including money that goes into employer-sponsored plans. Since freedom from financial worry is so important in retirement, you can add points if you save more than 10%.
- 6. Do I have a retirement plan mapped out? Retirement security usually won't happen by accident. Give yourself 5 points if you know how much money you expect to have available and how much you will need in retirement 10 points if you have completed a written analysis in the last two years.
- 7. Do I clearly understand the role of inflation in potentially undermining my retirement security? Prices have increased more than 600 percent since 1960. According to the Bureau of Labor Statistics, an item costing $29 in 1960 was nearly $180 by the end of 2000. Or, if you paid $100 for an item in 1984, it would cost an average of $174 last year. When planning for retirement, be sure to factor in inflation, too.(Bureau of Labor Statistics (12/15/00). Web site: stats.bls.gov)
- 8. Am I choosing retirement funding to meet my individual needs? Quantitatively, what return am I targeting on my retirement money? Are you being too conservative? Too
aggressive? Do you have an overall strategy or just select funding vehicles at random?
- 9. On a scale of one to ten, how sure am I that my spouse and children will be provided for if I die first? The key here, in addition to savings, is often life insurance. How much life insurance should you own? There's no single answer. Determining the right amount for you can be part of an overall analysis of your financial situation.
- 10. How well prepared am I for the possibility of a long-term illness? The number of adults that require long-term care is bound to increase in the coming years, and while many adults can be cared for at home, many others will need to be cared for in nursing homes a potentially expensive proposition.
How did you do?
In general, if you scored 85 or higher, you probably have taken steps to be financially, mentally and physically fit when you retire. If you scored between 70 and 84, you're probably on the right track, but you may need to take steps to improve in some areas. If you scored below 70, you could have work to do. Still, the payoff can be well worth the effort, so begin mapping out a strategy to boost your score and help plan for your retirement. While there are no guarantees that you will enjoy the good life when you retire, paying attention to the above items can help.
Rating: 4.0/5 (1 vote cast)
|Will You Enjoy the Good Life When You Retire?|