Don’t be fooled by Paint-by-Numbers Retirement

Paint-by-Numbers Retirement has been the standard for financial planners for years. Don't let it fool you into missing out on life. Two multi-ethnic senior women sitting outdoors at easels painting pictures on canvases. The focus is on the African American woman who is holding a paintbrush and looking up at her artwork as she laughs.

Retirement just ain’t what it used to be, for good and bad. Yet online calculators and many financial planners push people to plan for it the same way they always have.

The old approach uses formulas to arrive at a “magic number” that will sustain you through your retirement. You pick a date to retire, figure out how much you want to spend each year, estimate when you’ll die (everyone loves to do that), and voila, you’ve got your retirement goal in a single number.

You can frame that beautiful number and hang it on the wall of your office to motivate you each day to spend less, dump more into your retirement accounts, and pound away toward that goal.

A masterpiece? Yeah, right!

I call this dated approach “Paint-by-Numbers Retirement.” And let’s face it: the only time you’ve ever liked a paint-by-numbers painting was 20 or 30 years ago when your 5-year-old kid “painted” one.

Planning your life using a  Paint-by-Numbers Retirement approach could ruin your life both before and after retirement. Here’s what it misses:

1. Your life isn’t a number

If you focus on the magic number, you’ll damage your here and now immeasurably. And chances are, now – before you retire – is when you’ll have more health and energy to enjoy life.

You can’t create a masterpiece with a paint-by-numbers kit and some Crayolas. So how will your life be a masterpiece if you follow a standardized formula?

You’re an individual, and need individualized advice that most financial planners aren’t willing or able to give. (Yours truly being an exception to that rule, of course.)

2. You’ll live longer

A Paint-by-Numbers approach worked for your parents. They lived a much shorter time in retirement.

Problem is, you and your generation are living longer. According to the Stanford Center for Longevity, the average number of years men spend in retirement has jumped 150 percent from 12 to 20. That’s partly because today’s 60-year-olds have a 50-50 shot of living to age 90.

Are you ready for 30-40 years of retirement?

3. You won’t want to sacrifice in retirement

No matter how many sacrifices you plan to make in retirement, you’ll want to live a fulfilling life, and you’ll probably be way more active in retirement than your parents or grandparents were. I won’t say something quaint like “60 is the new 40,” but realistically today’s retirees aren’t ready to stop living life as they’ve enjoyed it in the past.

One of my clients enjoys eating out at expensive restaurants – it’s her hobby. She also travels a lot with friends to see PGA tournaments.

That all costs money and is hard to plan for, so cross out that magic number and get ready to paint a real masterpiece.

4. You’ll want to work

Another client honeymooned in his early retirement with a slow pace before realizing he needed to stay busy. He ended up hooking up with a company that sent him on consulting missions for the company that he retired from!

He spent another 12 years of his retirement taking on only the projects that interested him until he decided it was time to devote more time to his grandkids.

I mentioned in a recent article that a third of men who retire go back to work. And when they do, they feel much less burnt out while working than before they retired.

5. Connections will call

You know that newfangled Facebook thing? Baby boomers are now its biggest users, and it’s pushing many people to stay in touch with faraway friends, both digitally and physically.

My client Sally connected with old friends on Facebook and started commenting on their posts. That led to more personal connections with phone calls and group video chats. Before long, the friends had planned annual get-togethers.

How do you plan for that?

Rock Retirement

During and before your retirement, you want to live. With the right help, you can Rock Retirement. Just so happens that will be the title of my upcoming book.

Rock Retirement will walk people like you into the new retirement landscape and help you find a path that allows you to live well in all the future stages of your life.

And if you need something more personal, I can also work with you to provide individualized retirement planning that works for you.

Together, we can Rock Retirement.

Question of the week

How do your retirement plans vary from those of your parents? Are you ready for rest or will your retirement be an active, living thing?