Help Clients Break Bad Retirement Habits

This article first appeared in Rethinking65.

The story of a retiree who can’t seem to slow down illustrates how advisors can ease clients into a more rewarding post-career lifestyle.

Like many people in the insurance industry, George has a lot of retired clients who face tough choices over coverage costs. George and I met for breakfast to better understand each other’s business, but the conversation kept returning to George’s father-in-law, Steve, who also faces tough choices around retirement.

In his early 70s, Steve owns a small manufacturing company that produces components for the computer industry. Although he has no patents in a heavily competitive industry, he has managed to carve out his niche into a successful operation. Steve remains active in the business, but his family worries that he can’t keep pace with the physical and mental demands required to be profitable and effective. Steve is starting to recognize this as well.

He is in the midst of trying to figure out what his retirement should look like when his life is filled with “bad habits.” While Steve may not be in a post-career frame of mind, age is catching up with his ability to function at the high level needed for his company. He wonders about his identity if there is no work. He worries that he will be lonely with limited human interaction. Steve also believes his job gives him all the physical and mental activity he needs. Because of his age, he and his family wonder if it is just too late to change.

Obvious but Underlooked

As I learned more about Steve’s current lifestyle, it became apparent that he does not know how to break the cycle he is in, and neither does his family. I offered suggestions, but George replied with a sad smile, “David, my father-in-law is so set in his ways I don’t even think he would even take the time to listen to you.”

I responded, “What about his financial advisor?”

George brightened. “I didn’t think about that. Obviously, Steve is well off, but I think he has been using the same person for, like, 20 years. That’s worth a shot.”

Financial professionals see a lot more than numbers in the lives of their clients, particularly long-term ones. Whether by simple observations or detailed analytics, you can probably predict how people are going to react to retirement based on their current habits. This lets you help those heading into post-career life avoid detrimental behaviors. You can challenge the Steves of the world to think differently, even if they are well into retirement age.

The Identity Crisis

Of those 62 and older who have taken my Retirement Time Analysis (RTA), one-third responded they are not ready to leave their job or career and have no clue how to work out their use of time in retirement. Yet these folks either plan to be or are already in some form of retirement living.

You can help clients define a new lifestyle identity. Encourage them to understand the flexibility their portfolio can provide when put to good use. Discuss the possibility of phased retirement, where they can gradually scale back on work hours while pursuing a passion project. Push them to invest time talking with friends and family. Create your own post-career referral network to introduce “good habit” clients who can help those struggling to envision the life to come.

The Isolation and Loneliness Dilemma

Among those 62 and older who have taken the RTA, 27% do not consider it important to stay connected with others through a diverse personal network. Career-minded professionals naturally draw many connections from their occupation. But those are typically one dimensional and fade away when you remove the common element of business. Don’t think that social interaction from business will be enough as you get older.

You can help many of your retirement-age clients by highlighting the benefits and flexibility of becoming more directly engaged in the community. Having talked with many financial advisors, I am impressed with how many of you are involved in charity work within your communities. Many non-profits and philanthropic organizations need people with strong business acumen. You can be a bridge between charitable entities and the wealth of talent found in your client base.

The Loss of Physical and Mental Activity

Yes, a career provides mental stimulation and potentially some physical activity. The good news is that 90% of those 62 and older who have taken the RTA say they plan to be active in retirement. But that indicates one in 10 of your customers will not be active if the career goes away. Lacking a personal care strategy is bad planning.

You could be thinking, “I’m a financial advisor, not a personal trainer.” Very true. But you can still ask your clients whether a career really meets their physical and mental needs as they age. Draw on the rest of your client base to provide practical tips and advice on what you see being done well, and what you would counsel against.

You are an Influence

You probably have clients like Steve who are set in their ways. And there are probably family members like George worried about the choices their loved ones are making in their retirement years.

You can be a sounding board for a Steve to express their concerns about a loss of identity, social isolation, and the physical and mental changes that will occur.

You can be a positive influence for an entire family.

David Buck is the author of the book “The Time-Optimized Life,”?owner of Kairos Management Solutions, LLC, and founder of the Infinity Lifestyle Design program. As a certified professional retirement coach (CPRC), David works with financial services providers helping their clients create a post-career lifestyle strategy. To learn more, contact him at?[email protected]?or visit?Infinity Lifestyle Design.