The current retirement dialogue is woefully inadequate!

The definition of retirement according to Merriam-Webster is as follows – “withdrawal from one's position or occupation or from active working life”.

Essentially, it’s a time of transition from an active working life.

What’s the first thing that comes to your mind when you hear the term ‘retirement planning’?

For most people, the term retirement planning is associated with financial planning. Essentially, planning the finances to make sure that they have ‘enough’ money for the rest of their retired life.

Given that we are living longer, we are looking at 30-35 years of a retired life. Shouldn’t planning for this period be more than one number?

Unfortunately, the current retirement dialogue is woefully inadequate both on the financial and non-financial fronts.

The dialogue around money primarily centers around the question of whether our money will outlast us. It’s about finding out whether we have enough money.

No doubt this is an important aspect but equally important is to ask - “Enough for what?” What type of lifestyle would you like your money to fund? What’s the best lifestyle for you that your money should enable? These, in my opinion, are bigger questions.

Unfortunately, there is minimal thought given to this. The entire financial services industry predominately focuses on helping people create wealth rather than consume it. On some level consumption of wealth is a harder problem to solve for.

What is the problem that we are solving for? Or better yet, what is the problem that we should be solving for?

Today’s retirement concept seems a bit illogical. It feels like a random finish line where people are supposed to stop what they have been doing for the last 40 odd years.

What do we do with all the free time at our disposal? If our job was a big part of our identity, how do we fill that void once we stop working?

Eventually, the most important question is “how do we have a meaningful and happy retired life.”

Unfortunately, we plan more for a 2-week vacation than a 30-year retirement.

Over the course of the next few weeks let’s do a deep-dive into the various aspects – financial and non-financial, that can facilitate a happy retirement.