The New Retirement and Lifestyle Planning – what they mean to you  by Av Lieberman

What is the New Retirement?

The definition of retirement has changed dramatically in recent years.  At one time, you retired at age 65, put your feet up and lived into your early 70’s, if you were lucky.  Based on this view of retirement, it simply wasn’t necessary to plan for an active lifestyle extending many years into the future.

However, the New Retirement is very different.  People now retire younger and live longer, and doing nothing for 20 or 30 years is not an option. Retirement is not the last stage of your life; rather, it is just the next stage.  It means retiring to something, not from something.  But, deciding what you will retire to can be a time consuming and confusing process that requires guidance.  To seek it is well worth the effort and, in doing so, you will gain a sense of control over your future and are more apt to get the life you want.

What is Lifestyle Planning?

Lifestyle Planning is a new approach within the Financial Planning Industry.  Typically, the industry uses rules of thumb, the most common being to consider 60 – 70% of pre-retirement income as enough to retire on with a reasonable standard of living.  However, rules of thumb do not take into consideration a person’s individual circumstances.

The premise of Lifestyle Planning is to develop a financial or retirement plan based on your own unique “vision” of the lifestyle you hope to achieve.  The vision entails clear lifestyle goals and objectives set by you that need to be reviewed and updated periodically.  Recent studies on the subject of “life satisfaction” clearly show that people with clear, realistic goals and objectives have a higher level of life satisfaction than those that don’t. In the Financial Planning Industry, setting these lifestyle goals and objectives first is the most important step in planning for the future.  When investing money without a clear purpose (goals and objectives), you cannot know how much is enough or the rate of return required on your investments.  Without lifestyle goals and objectives, it’s impossible to place an accurate price tag on the question, “How much money do I need to live the life that I want?”

As a retirement educator, Av is frequently asked this question, and his answer is always the same. “Tell me what your vision is first and then I can tell you how much is enough.”

The process

Av’s work is almost exclusive to company or organizational employees.  He has  worked with hundreds in the past six years, helping them build their own vision.  He walks them through a thought provoking and often life changing process where they deal with key life and retirement issues. The concept of retirement and what it means to them personally is demystified.  During the process, lifestyle goals and objectives are set.  The end-result is not only a vision, but also their financial reality.

Thinking about the future

Here are some thought provoking questions guaranteed to get the wheels turning.

– How do I want to spend my time in retirement?

– What do I really like to do?

– What will keep me motivated?

– How will I react to not having a job?

– Do I want to develop a second career?

– How will retirement impact my family?

– Is semi or phased retirement an option for me?

– What are my strengths and transferable skills?

There are many other questions involved in the process of creating one’s vision, but these are some of the most important.  Take a Lifestyle Planning approach to your future.  It will help you get the life you want.