Retirement – Adjusting to the reality (III)

Today, we conclude on how we can try to make ourselves comfortable thinking about and taking actions that will help us adjust wisely and normally to retirement. Think through the issues: Many people defer thinking about important issues in life such as retirement planning. This is partly because critical thinking can be difficult for many […]

Today, we conclude on how we can try to make ourselves comfortable thinking about and taking actions that will help us adjust wisely and normally to retirement.

Think through the issues: Many people defer thinking about important issues in life such as retirement planning. This is partly because critical thinking can be difficult for many reasons. From a physiological perspective, our brain is only about two per cent of our body weight, but it accounts for a disproportionate twenty per cent of our total energy usage! And while only a little bit of that energy is used to manage involuntary actions like breathing and heartbeat regulation, our active thinking takes a lot of it. Secondly, thinking makes us ask questions, to which we may not immediately have all the answers. And when we don’t have answers to questions that we consider important, we can get apprehensive! Even when we come up with answers to our important questions, we may need to take physical action to sort out a problem or seize an opportunity. So, it is quite easier for many people to skip all those crucial steps and just get physically ‘busy’ without much strategic thinking behind their actions.

But it is very important for a person to take time to think through their retirement planning. As mentioned, the earlier we can begin to think through these issues, the better we will get comfortable in addressing them. And equally importantly, the earlier we begin to take deliberate actions, the more we can create value for the type of retirement life we desire.

Know where you are and where you want to get to: Knowing where we are at any point in time is important in planning how we want to get to where we want to get to. The person who wishes to get to Abuja from Sokoto has different options of getting to their desired destination than another who also wishes to get to Abuja but from Port Harcourt. The person who doesn’t know where they want to get to will not succeed in getting anywhere because they haven’t even defined what success (their desired destination and the journey that will take them there) is.

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A critical thinking starting point is to establish where we are and where else we want to get to. You can be as ambitious as you legitimately can be, but you need to be realistic and positively cautious. You will need to know exactly where you are now on your finances, health, relationships, and what lifestyle you want to have in retirement. Based on that you will need to work out where you need to be and how to get there on those dimensions at various milestones towards your retirement.

Educate yourself: Knowing where we are and where we want to get to regarding our retirement is about understanding important factors in the four spheres of retirement planning and educating ourselves on them as follows:

• Financial planning: Financial planning is important, and it is, unsurprisingly, what most people focus on. However, many of these people do not have a pre-retirement financial discipline and neither an articulate plan of precisely where they want to be at various pre-retirement phases. Rather, it is mostly about spur-of-the-moment things. Other than participating in defined contribution plans, many people with discretionary incomes would go into one business or another or make one investment or another based on some prompting of a family member or friend. That is not the best way to go.
• Health: When a car is new all the parts work perfectly fine. However, as it ages, parts of it will begin to develop problems and maintenance might need to be more frequent. I think human beings are sort of like that and that it is of the grace of God that for all we subject our bodies to we can still last to a hundred years!

As we age our organs will begin to weaken. For some, genetics and lifestyles could bear additional pressures on our organs. We need to always know what our health status is to enable us to plan how to manage this very important component of our pre- and post-retirement lives.

• Social: We will need to think through the level of socialisation that works for us and which makes us happy. Just knowing that we have certain circles of relationships made up of people that we have come a long way and who have our backs is comforting. Knowing that they are there for us as we will be there for them strengthens us and gives us hope and meaning in life. But relationships evolve. We will need to understand their dynamics and have plans about our immediate families, neighbourhood, communities, etc. We will need to be active, engaging and of value to others.
• Psychological: How comfortable are we that we will retire with all the legitimate concerns that may trigger fears and apprehensions? Being ‘comfortable’ about retiring regardless of those concerns is not really all about having solutions to each issue all the time. Of course, the more issues we can always sort out the better. But being comfortable means we trust that we can figure things out. It means we should learn and do what is right and wise.

Over the coming weeks, we will take up the issues in the order above in greater detail. Hence, next week we will take up Financial Planning for retirement.