I was remodeling a little condo my wife and I had just bought. The CEO looked at me and said, “I don’t know how to swing a hammer. I can’t do what you’re doing.” He had bought 500 acres in upstate New York and wanted to learn how to swing a hammer.

He already had the 500 acres. What he was talking about now was what he wanted to do there. He wanted to learn to swing a hammer and build something himself.

Here was a man running a large brokerage company, interested in becoming a beginner at something I was already doing in my little condo. The money had bought the land. It couldn’t do the learning for him.

And that is where the retirement conversation needs to go next: beyond what you can afford to have, to what you actually want to get up and do.

In the last article, we worked through what goes into figuring out whether you have enough money to retire. The travel, the house, helping family, the everyday spending, and the conversations that need to happen when your spouse has a different picture of retirement than you do.

Now let’s say we have done that work. Your financial plan supports retiring, based on the spending, income, and assumptions we have worked through. There is still another question to answer.

What are you going to do Monday?

Not the Monday when you board the plane for the trip you have been putting off. The one after you get home. There is no office to go into. No co-workers to talk with about the weekend. The problems that used to land on your desk are landing on someone else’s.

What does that day look like?

What Are You Actually Leaving?

In the first article, we spent time figuring out what it would take to replace your income. But the paycheck isn’t the only thing you have been getting from work. There are people you know, problems you have learned to solve, and responsibilities that give some shape to your week. You may complain about parts of it and still care quite a bit about others.

We can have a plan to replace the income without having a plan for any of that.

Some of the comments I hear from clients approaching retirement are, “My friends and colleagues are at work,” or, “I like the challenge of work. The idea of sitting at home doesn’t appeal to me.” Others like the routine. Those aren’t financial objections. They are telling me something about the life they don’t want to lose.

Think about the person who is tired of the pressure but still enjoys solving a difficult problem. Or someone who is done with the commute but looks forward to seeing the people at the other end of it. They can be ready to leave the job and not be ready to give up those parts of their day. That isn’t a contradiction. The problem is that, up until now, those things have all come together.

This is where the word “work” can get in our way. We use it to describe earning a living, but also teaching someone, building something, helping solve a problem, or taking responsibility for something we care about. When we say we are done with work, are we talking about all of that? Or are we talking about the particular job we have been doing, with its particular demands?

I’ve watched several women I know, including my wife, return to the workplace, not because they needed to, but because they wanted to. They went back to do something different than before. What they found was a new challenge, a sense of purpose and belonging, and structure.

Going back to work by choice is quite different from having to go back because you need the income. Being able to stop earning a paycheck doesn’t mean you have stopped wanting what else a job might give you.

And maybe you are reading this thinking you won’t miss your job at all. You already have friends outside of work, interests you want more time for, and people you want to spend that time with. Or you are worn out and need some room to breathe before deciding what comes next.

I am not suggesting you immediately fill every empty hour with another obligation. We are trying to understand what you want your life to contain, not recreate your work schedule without the pay.

So I would ask two questions together:

What am I ready to leave, and what would I be sorry to lose?

Put those answers next to each other. You might be ready to leave the deadlines but still want a challenge. Ready to stop managing a department but still enjoy helping someone learn. Ready to leave the office but not the friendships.

Now we have something more useful than “I want to retire, but I’m not sure I’m ready.” We can start looking for ways to leave what you are finished with while finding other places for what you still want.

Getting Those Things Outside of Work

I have a longtime family friend who retired from being a fireman. For years, he has volunteered with a couple of different programs related to dogs. That is where he found community, but he also found a challenge, new learning, structure, purpose, and friends outside of work.

You could describe what he did as “volunteering.” But that one word doesn’t really explain all that he found there. Look back at the things people tell me they will miss about work. Quite a few of them are on his list.

I come back to three things: health, community, and purpose.

The trick is to find things that bring more than one of them into your life. You don’t necessarily need a separate activity for every box.

I also have a client who, while still working, was already hiking all over the place with her hiking group. There is an activity she enjoys, people to enjoy it with, and something that gets her moving. She didn’t have to wait for retirement to start finding that part of her life.

This is also why I don’t think “go volunteer somewhere” is a complete answer. I have known people who volunteered only to find that the particular commitment created stress and anxiety. The organization and the role need to fit you. A good cause doesn’t automatically mean every job within it is the right job for you.

What Have You Wanted to Learn?

When my grandma retired, she became a regular at the local junior college. She took everything from poetry to painting. I think she ended up with about 70 units in art and writing classes.

What have you wanted to learn that has nothing to do with what you have done for a living? Is it something as simple as learning to swing a hammer? Or perhaps there is a part of your profession that you always enjoyed but rarely had enough time to explore.

There is another direction to consider, too. What do you already know that might be useful to someone else? Could you teach it?

You may be ready to stop doing your particular job without wanting to leave behind everything you have learned along the way.

Start With Something Small

When I coach, whether it is kids on the soccer field, young people starting out, or people preparing for retirement, I like to find the “easy wins.” Those are the ones that build confidence.

With retirement, we can start identifying what connects you to work and gradually find other places for those things in your life.

That is the idea behind the work-satisfaction exercise in my retirement material. We look at what work provides: identity, contribution, learning, structure, purpose, community, challenge, routine, and friends. Then we identify which of those things matter most to you.

Here is a place to begin:

1. Write down what you would miss about work. Be specific. “The people” is a start, but is it the friendships, having someone to solve a problem with, or simply being around others during the day?
2. Put a possibility next to each one. An actual class, group, organization, or person, not just “I’ll get involved in something.”
3. Try one before you retire, where practical. Go to the class. Meet the group. Find out what the volunteer role involves. See whether you enjoy the activity and the people.

You can start this exercise after retiring, too. You are not committing the next 20 years of your life to the first thing you try. You are learning something about what you want your days to contain.

And if you are married, compare notes with your spouse. Just like the spending exercise in the first article, you may discover you have been imagining different things. What will you enjoy doing together? What will each of you do independently?

Your spouse may already have a routine they like. Your retirement needs to make room for that, too.

Back to Monday

I often describe money as banked time. Part of what we are doing when we save for retirement is trying to reach a point where our savings and other income can support our lives without our having to keep earning a paycheck.

But that still leaves the question of what we want to do with the time that is now available to us.

Travel belongs in that picture. So does rest. There is nothing wrong with enjoying the things you worked and saved for. But alongside those plans, think about the people you want to spend time with, the things you want to learn, and the responsibilities you would actually like to have.

One of the questions in my retirement material is, “You are more than what you do at work. Who else looks up to you, relies on you, and wants your connection? Why?”

Spend a little time with that one.

Then look back at the parts of work you would miss and the things you have been saying you will get around to someday. You don’t need every day figured out before you leave. But you should be starting to see a life outside of work that you would like to move toward.

So, what would you like to do Monday?

Once that picture starts taking shape, we can come back to the money with a better understanding of what we are asking it to support. And if the life you have in mind costs more than you expected, the conversation doesn’t have to end at “save more” or “spend less.”

There is another question to work through:

Are we making the best use of what you already have?

In Part 3, How to Make Your Retirement Number Go Further, we’ll look at the planning around taxes, income, and how you draw from your savings. Not to pretend that every item on the wish list can fit, but to explore whether different choices could make more of it possible.

We have talked about having enough and what you want to do with it. Now let’s look at how planning can help what you have support more of that life.

This article is for general educational purposes and is not a recommendation that any individual retire or change an investment strategy. Retirement decisions depend on personal circumstances and planning assumptions, which may change over time.

The post You Can Afford to Retire. But What Will You Do Monday? appeared first on Lynch Financial Advisors.

My client base is filled with a large range of people, PhDs to teachers, firemen to nurses, business execs to business owners… and everything in between. Smart people—these people have come to me at different stages of building their retirement bucket… why would these smart people talk with me? I mean, they can get “that number”—right?

Multiple Numbers In The One Number

The issue for almost everyone, whether they see it or admit it, is there isn’t one number. My wife and I moved to New Jersey one year out of college. We loaded up 3 boxes 3×3 in size… that and the suitcases we took on the plane was all we moved back east with.

After four years back east, 9/11 happened and something changed in us, pushing us back to California to “move to the family” stage of life. This time we had a bit more than 3 boxes and a few suitcases. We loaded up our Durango to the hilt. Had a roof rack filled and a tow-behind uhaul trailer—you know, the one that looks a bit like a horse trailer—that one.

When we left New Jersey, I said, “Babe, this is how our life should be. We should be able to fit it all in a van and a trailer.” Today—well, it’s different. I will say I don’t pay rent at a storage facility (that isn’t to shame you if you do).

What is different about all of these is what it costs to live. When Erin and I moved to New Jersey, I was still looking for a job. I think her starting salary at the new gig was around $60k. The $900 a month apartment was $50 over the amount I had budgeted for us—but it had a view of the World Trade Center, so my wife was able to sell me on splurging to rent that place.

Fast forward 4 years—we both were employed, and what we could afford had drastically changed. We went from 4 meals of macaroni and cheese a night to eating out 4 nights a week.

Our number (the pot of money we needed to retire us) when we moved to New Jersey was close to $1 million… 4 years later, that number was more than triple that. And that was just in four years!

Retirement is not necessarily this in reverse. I recently had a couple come to me close to retirement. We ran their “number” and found out they were there. But then, as the time got closer, they talked with friends they would be traveling with. And you know what happened? The number moved. What they thought was a good “travel” budget was half what they needed to travel with their friends.

There lies the reason people are not so ready to retire based upon the number ChatGPT gave them. They see that the number is going to have to serve a lot of different masters—travel, charity, general living expenses, upkeep or upgrade on the house. Add in a spouse, and that number can become even more complex. What I want to do in retirement may be different than what my wife wants to do in retirement.

And this right here, this junction point of not really knowing what goes into making up what the number has to account for, is at the center of what keeps many people from retiring.

Getting The Ideas Out In the Open

Suggestion? Years before you retire, do a few things:

1. Try on the travel you have in mind. Take a few trips and find out what the hotels, restaurants, and travel style you actually enjoy will cost.
2. Figure out what your house needs. Price out necessary repairs and nice-to-have updates, then decide what you want to tackle before retiring.
3. Compare your retirement with your spouse’s. Each of you should put numbers next to what you want to do, then see whether you have been budgeting for the same retirement.
4. Put a number on helping family and giving to charity. College, weddings, gifts, and donations need amounts and timing—not just good intentions.
5. Price an ordinary week at home. Eating out, golf, clubs, and hobbies can look different financially when you have more time to enjoy them.
6. Plan for the things you will eventually replace. Put cars, appliances, and other large purchases on a rough calendar with estimated costs.
7. Price a move before assuming it will save you money. Look at actual homes, moving costs, taxes, insurance, and association fees—not just the difference in purchase prices.
8. Give your retirement budget a trial run. Try living on the planned amount for several months, including setting money aside for expenses that don’t show up every month.

Now, if you look at this and think—shoot, that is a lot to do—you’re right. Worse, what happens when you know that you likely don’t have enough to do everything on both of your lists and the negotiations start to happen?

Now you’re starting to see why people come see me. Many of my clients call me their marriage therapist. Look, I am not going to help your husband pick up his socks off the floor (my wife hasn’t gotten me to do that yet. I have gotten to the point of throwing them in the direction of the hamper. It’s one step at a time! 🙂 )

But Wait, Is There a Number?

I can hear half my clients right now, “Wait, so you’re saying there isn’t a number?” No, there is a number. But as a first step we need to figure out what will be needing to be spent during retirement (there are other steps to finding out the number – what other money you will have coming in (pension, social etc), but for the purpose of this article, we are talking about the elements of the number that are often unknown and not talked about.

So the point of the exercise of “getting the ideas out in the open” is to through it all out there, then start peeling back what is possible based on what you have saved up… and how much more you can save before you reach retirement. I have had plenty of clients go from the “dream house in Hawaii” to increasing their travel budget and staying in their current residence. It gave them more flexibility with travel while not adding years of additional savings for their “dream house.”

Professional Help and Purpose

So my last suggestion—well, it should be my first suggestion: tackle these items above with a professional. Someone who can help dig into the questions, hear what each of you is trying to say, and put numbers around the choices. Sometimes that means being the person who has to say, “We can do this, but doing all of it would require something else to change.” Often I will have a client say, “Mike, I say the same thing, but they hear it different from you”—isn’t that the case with much in life? You hear something from one friend and you dismiss it because of the way they explained it, then another comes by and it makes sense and you buy in.

The calculator can give you an answer. The work is figuring out whether that answer accounts for the retirement you and your spouse actually want—and what you would change if it doesn’t. Once we understand those costs and what income you will have coming in, we can get a much better idea of what your savings need to provide.

There is another part of being ready to retire. You may know what the vacations, the house, and the everyday expenses will cost and still not know what you want your days to look like. Or the “Monday morning question”: What happens that Monday after you retire? There is no office to go into. No co-workers to chat about the weekend. No one needing the particular skill you have to solve a problem. This leads us to that big word “PURPOSE”—what is my life—outside of the traveling, etc.—about when I retire? We will dig into this in the next blog.

The post How Do You Know When You Actually Have Enough to Retire? appeared first on Lynch Financial Advisors.

Figuring out how to choose the “right” advisor is not as simple as selecting a CPA, whose stringent requirements are relatively straight forward. This is partly because for many years a 4 year degree was not required to become a Certified Financial Planner (CFP). Today, one must first obtain a higher education degree to become eligible for CFP certification. Interestingly, the subject matter does not matter at all – it could be a degree in History, Mathematics, or even Art. This vague set of requirements sheds some light on how disparate the education and experience can be of those in financial planning. To the CFP’s credit, they’ve started to following in the footsteps of NAPFA, and are pushing their certification to be a much higher standard than it once was. Additionally, they’ve put together a good program that gives those interested in the field of financial planning a baseline to work from.  We get our interns from the CFP program and so our current Para-Planner, Ricky, has passed the CFP test.

Incidentally, Mike’s degree is in Finance with a minor in Economics. Going into college, he knew exactly what he wanted to do with his career.

Confusion in the marketplace goes beyond designations like CFP because new terms have cropped up over in recent years such as Family Office, Wealth Manager, Financial Advisor, Financial Planner, and Investment Advisor, among others. Furthering the confusion, there are numerous places to find these professionals.

• Captive Agents:  People typically working in the insurance industry.
• Hybrid Advisors:  Advisors that can charge you for their time and collect commissions.
  The easiest way to spot them is looking at the bottom of their website.  It will say something like “securities offered through” on there somewhere.  This means that they can take commissions on the products/assets they manage.
• Fee-Only:  The only true no-commission advisors.
  Those legally using the term Fee-Only proudly belong to NAPFA.
• Fee-Based:  An unregulated term that can be used by advisors who “switch hats” between providing advice and selling products or receiving commissions.

Ok, this is all great- but this really doesn’t help me find the Best Advisor for ME.  How do I do that?  If you agree with the below concepts/ ideology, let me see if I can help:

1. The advisor should understand there are two parts to every individual.
   There are things we can control and things we can’t.  In the space of financial planning there are items which are behavioral in nature such as wanting to sell when markets decline, or justifying increased spending because you’re working extra hours. Then there are tangible choices such as how much you can save. If you feel that you can be honest with yourself about the things you can control and the things you can’t, then we’re off to a great start in terms of compatibility.
2. The advisor should know you well enough to see when you are making a behavioral choice that could adversely affect your long term plans.
   A detailed advisor can see ALL aspects related to your tangible choices. They prepare your taxes so they know how to save tax dollars today and far into the future. They don’t need to know every dollar spent, but they can easily estimate what it’s taking my to run a current household. They can build a portfolio that will protect from significant market corrections. They can work with insurance agents to adequately insure (and not over insure). Lastly, they can work with or even recommend an estate attorney so that assets are disbursed correctly when you die. If you find yourself nodding along here about an advisor working form the big picture, we’re even more likely to be a match for each other.
3. It’s important that the advisor understands that life is more than just accumulating as much money as possible.
   While money enables the time that we desire with friends, family etc., Advisors see life as more than just the dollars one accumulates. They understand that each one of us has something unique driving them forward and a reason behind trying to amass wealth. This could be so they can stop working at an undesirable job, or to be prepared to help out an aging parent. If you like the idea of an advisor seeing your unique situation and build helping you build wealth as a means to your goals, then we’re ever more likely to hit it off great.

If the above resonates with you, we would love to meet you.  We are passionate about working with people that fit these 3 concepts.

Thought Leadership

• You Can Afford to Retire. But What Will You Do Monday?
• How Do You Know When You Actually Have Enough to Retire?
• Finding the right Financial Advisor for you

Related Content

The post Finding the right Financial Advisor for you appeared first on Lynch Financial Advisors.