Most adults 50 and over are looking toward their retirement years, at least in passing. The idea can be frightening for those who haven’t intentionally set aside funds to see them into their golden years. They may lack enough money to do what they’d like or maintain their standard of living.
Life expectancy keeps rising, and the number of years you’ll need enough funds to survive increases. Add to those worries fears of inflation and whether or not Social Security will survive, and you can see why it’s crucial to be intentional about retirement—whether you have a few years left to plan or decades.
What Does Purposeful Retirement Look Like?
Finding fulfillment during retirement means you can do what you want rather than punching the clock for a paycheck. You might learn something new, expand your education, spend time with family and friends, travel, or volunteer with a charity.
However, purposeful retirement only works if you’ve planned for your needs during that time. If you’ve failed to plan, you may still have to work or spend time on pursuits you’d rather not.
A recent AARP survey found that about 33 percent of adults report they will not have enough saved for retirement. Many worry whether they’ll be able to afford even basic necessities, and others are resigned to working until they are no longer physically able.
No matter your age or current savings, now is the time to assess where you are and where you need to be to retire.
Steps to Plan for a Purposeful Retirement
What does it look like to retire intentionally? The more you plan, the more likely you’ll have what you need to sustain you throughout your non-working years. Retirement can look different for everyone. Some people want to continue to work, while others travel the globe. Here are the steps to take to figure out what you’ll need and how to get there.
1) Assess Your Finances and Needs
Before planning for a fulfilling retirement, you must know where you are financially, how long you have left to save, and what you’ll need to maintain your standard of living.
Ask some tough questions to solidify your vision for retirement. Doing so can be difficult if you’re still in your 20s and unsure what you might want to do. Just make your best guesses. If you’re in your 40s, you may have a better idea of how you’d like to spend your non-working years. Ask:
- Where do you want to live, and in what type of home? For example, a larger home requires more finances, but you’ll have something to sell if you need or want to. Living in an RV may require minimal spending. Living in a beautiful, upgraded mobile home park may give you the best of many worlds.
- What hobbies or interests do you plan to pursue in retirement? If you want to take college courses, you’ll need the funds to cover tuition and books. Gardening may be a hobby that pays back if you sell veggies at a local farmers market.
- Do you want to travel? Think about how often and where you’d like to go.
You should also examine whether your future costs will be similar to those currently in place. Do you plan to pay off your home and not have a mortgage payment? Also, account for inflation in items such as food, buying a new vehicle, and property taxes.
Sit down with a financial advisor and calculate how much you need to be able to withdraw and still have enough to get you through retirement. Your portfolio must be personalized to your goals.
2) Be Intentional About Investing
It’s easy to get bogged down in daily living and fail to save for retirement. The teenager needs braces, the family really wants to take a trip to Disney World, and a bigger car is a necessity. Soon, you put off saving for your non-working years and realize they are upon you. Decades pass faster than you can imagine.
Some ways to ensure you keep your focus on the big picture include:
- Automatic withdrawals: Set it and forget it. Have a percentage withdrawn from your paycheck and automatically put into your 401(k) or Roth IRA. If you never get the money, you won’t miss it. Doing a percentage also ups your contributions as you get raises.
- Company contributions: Take advantage of any company matching funds as they are free money for retirement.
- Staying informed: Build strong financial planning and information-gathering into your everyday routines. For example, as around 80 percent of people already check their mobile phones first thing in the morning, you could use this time to check on your accounts or study stock market trends instead of mindlessly scrolling.
- Making small sacrifices: Give up little luxuries and save more money. Forgo that $5 cup of coffee two mornings a week, and you can put an extra $40 toward retirement each month. It might not sound like a lot, but the sooner you begin, the more compound interest you’ll accrue.
Although focusing on retirement with some purpose is wise, don’t forget to live your life now. No one is promised tomorrow. If you never take the trip, always drink coffee at home, and avoid eating out with friends, you’ll miss precious memories that might not come again. You can retire successfully and still enjoy life along the way—it’s all about balance.
3) Consider Your Health
Everyone worries about wellness, but for 31 percent of retired Americans, it is their top concern. The healthier you are as a retiree, the less of your savings you’ll spend on healthcare costs. As with most things concerning retirement, finding the right balance between enjoying the occasional slice of wedding cake and prioritizing your health is crucial.
Retirement doesn’t mean you stop living. Make a plan for how you’ll stay fit and active so you can enjoy all the things you’ve been dreaming of doing, such as:
- Stay physically active to keep things such as blood sugar, weight, and blood pressure in check.
- Flexibility matters as we age, so take up Pilates or yoga.
- Mental health is sometimes overlooked. Have a support network to help you through difficult times. As people age, they may lose pets, loved ones, and things they can no longer do.
4) Pay Off Debt
The number of people over 65 with mortgages is 38 percent and rising. After retirement, people make big purchases and now have a monthly payment that eats into their fixed income from Social Security and other sources.
If you want a comfortable retirement, you must pay off debt before leaving your job and refrain from taking on significant new debt. Fortunately, there are a number of things you can do to ensure you don’t wind up drowning in loans or credit card balances:
- Maintain your vehicles to keep them running longer and aim for lower monthly payments on vehicle purchases.
- If you have a costly mortgage, consider downsizing your home to a smaller one so that you can pay off more quickly.
- Cut down on your credit card utilization and pay off your balance every month.
Ideally, you’ll enter retirement with far fewer expenses than you had while working. Doing so may allow you to retire sooner and live more comfortably so you can focus on your purpose during your golden years.
5) Find a Job
Should you work in retirement or not? There isn’t an answer that works for everyone. Some people enjoy getting out of the house and interacting with other people in a professional environment. Their retirement might look like them going part-time at their current job or getting something on the side.
- Consider freelancing. Use a skill you already have and work when you want. You can limit the number of clients and set the hours you prefer. Freelancing can give you the flexibility to travel when you want or take off to pursue other interests.
- Try something new. Do you love working with children? A part-time job in the school cafeteria or as a teaching assistant may be your cup of tea.
- Go for the money. Not everything you do has to be fulfilling. Some jobs bring the money you might need to do fun things like travel. You can choose something flexible, such as food delivery or working as a server at your favorite restaurant.
- Sell your crafts. Find something you love to do, such as painting, gardening, carpentry, or knitting. Offer your items at local craft fairs or set up an online shop.
Some people see retirement as when they have zero opportunities to bring in additional money. However, many retirees work seasonal jobs through companies like Amazon and Walmart to meet holiday shopping demands. You might work during a season and then take the rest of the year off with these programs.
6) Pursue Your Passions
For most people, retirement means finally having the time to pursue the things they love to do. The reality looks different for everyone. Someone who loves dancing might join a senior dance group or take ballroom dancing classes. People who know what they love have an easier time planning their newfound free time accordingly. But what about people who have no idea what they enjoy because they’ve worked 60-plus hours a week for 30 or 40 years?
Start by thinking through the skills you have or admire in others.
- Take some craft classes or try a list of hobbies to find one you enjoy.
- Hang out with others who have a passion for something.
- Go to events in your community, such as painting classes, book clubs, and senior citizen groups.
- Take a non-credit course through your local community college.
It can take time to figure out what you most enjoy. You may just like having more time to read and spend with extended family. You don’t have to figure out every aspect of retirement to live it fully. Part of the freedom of no longer working is finally having time to see what you enjoy and what you’d rather avoid.
7) Find Social Connections
An intentional retirement means more time with family and friends for many. However, not everyone has a large extended network. Knowing how to find new connections when you don’t have any is crucial to avoiding isolation and enjoying your life after your work years. You’ll lose the natural connection between coworkers, so you’ll have to be more intentional about seeking out others, especially if you tend to be an introvert.
Some ways to find social connections include:
- Volunteer with a nonprofit you admire. Studies show retirees who volunteer have lower mortality rates.
- Have a conversation with your family about when you can see each of them. You might have dozens of grandchildren, but if you don’t somehow coordinate visits, you could find yourself going weeks without seeing anyone.
- Make a new friend by joining a group at church, meeting with others your age, or reaching out to your extended friends.
- Host a gathering. Some seniors enjoy cooking one weekend day a month for family and friends and having an open-door policy. If entertaining fits your retirement budget, it can be an excellent way to remain social.
If your spouse is still alive, finding the regular companionship most people crave is easier. However, if you are single or a widow or widower, you may need to be more intentional about getting out in the community and meeting people. You could also adopt a cat or dog if you can care for a pet and plan to be at home most of the time. Animals can be excellent companions for people of all ages.
Make a plan now for how you’ll handle any loneliness that might arise from no longer having a structured workday where you regularly see other humans.
Consider the Unforeseen
You can plan every aspect of retirement and be highly intentional about what you want and how to get there, but the unexpected might throw you off kilter. A good financial advisor will help you navigate potential pitfalls, such as rising expenses, an unexpected medical issue, or wanting to go on a trip you didn’t plan for. Factor in some big and small unforeseen catastrophes and plan for them now so you’ll be ready when they happen.
With much planning and determination, you’ll enter retirement ahead of most others. You’ll be able to do the things you’d like and not have to worry about funds. Intentional retirement planning makes your senior years look like a breeze. Enjoy every minute.
By Eleanor Hecks
The views and opinions expressed are those of the authors. They are meant for general informational purposes only and should not be construed or interpreted as a recommendation or solicitation. NTD does not provide investment, tax, legal, financial planning, estate planning, or any other personal finance advice. NTD holds no liability for the accuracy or timeliness of the information provided.