Good morning Dinks. If you are like me then your parents are retired. Well at least one of mine is. My Dad is 60 and he retired almost five years ago and now spends his days playing poker with his friends. My Mom tried to retire once but she didn’t really like it so she went back to work. My Mom is a very structured person so the carefree lifestyle that comes with retirement kind of freaked her out. Are your parents retired?
My parent’s views on retirement, among other things, very drastically. My Dad counted down the days until he could retire. He accepted his last pay check with grace and started collecting his monthly pension. My Mom failed miserably at planning for retirement and she ran right back to the workforce. Her retirement was forced when she lost her job so she didn’t have time to prepare emotionally for the transition. They are two very different people with two very different views on retirement, maybe that’s why they are now divorced.
Planning for retirement with your employer
My Dad worked at the same job for the majority of his adult life. It was a union job that gave him a good salary, full benefits, paid vacation and a company-paid pension plan in exchange for eight hours of manual labor per day five days a week.
My Dad definitely looked forward to the day he was eligible to retire and he has never looked back. Isn’t that a strange thing to say, eligible to retire? We often talk about retirement as being the time of our lives when we are ready to stop working, but the truth is we can only retire when our money allows us to.
My Dad always says if he didn’t have his company-paid pension he would never have been able to retire. With two kids, a house and two cars there wasn’t a lot of room for retirement savings in my parent’s budget. Money was spent on the kids, monthly expenses and our annual family vacation. Retirement planning just wasn’t in their financial forecast.
The emotions of planning for retirement
When my Mom’s company closed down in 2010 she received a payout package and thought she was ready to retire at 54, but she was wrong. My Mom is the type of woman who wakes up at 7 am on the weekend, so it was hard for her to wake up every day without a schedule. To say she didn’t like it would be an understatement.
The stress of money (or lack of) was also a difficult adjustment for my Mom. She was at home with not much to do. She worried about spending money because she didn’t have a steady pay check coming in every two weeks. She now had to adjust to living on a monthly budget and she didn’t like it. My Mom was bored during her mini retirement. After repainting all the rooms in her house and remodelling the kitchen at her cottage she went back to work.
Maybe when we are planning for retirement we take our spending for granted. While we are working if we over spend a bit we know we will pay it off with our next pay check or we can work some extra hours to gain overtime pay. But what happens when we no longer have that option?
Is your retirement planning based on your age, emotions or your money?
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Kristina Tahnyak
Tahnya is a Certified Financial Planner and former Investment Advisor turned marketing and communications professional She holds a degree from Concordia University, is debt free and currently works in the field of digital marketing.
I would say my retirement would be based upon emotion and money. Right now I can’t even imagine retirement…the thought of it bores me to tears (I’m probably in the same boat as your mom). So, I definitely have to feel ready to retire, and I have to have the funds to do so. Age wouldn’t factor into it.
All three. My husband gets a pension with a COLA tied to the same formula that Social Security recipients get (which sometimes equals zero) and he had to work until age 55 in order to get the benefits. In addition to his pension, we had tracked our finances for a couple of years to be sure that we could afford to live on the reduced income. And we had also paid into his thrift savings plan (TSP) and IRAs for me. The pension and TSP carried us through age 59 1/2 so we were able to tap into our IRAs, which we haven’t done yet simply because we don’t need the extra $$. Emotionally, we were ready to retire long before we were eligible to. My dad died 7 months before he was scheduled to retire at age 64 and at that time I decided that 10 years of my life was going to be mine instead of an employers. My husband and I were on the same page with regard to making certain specific things were in place in order to retire. House paid off, son’s college fully funded etc. We’ve been retired 8 years now and can honestly say that we’ve never regretted it for even a day.
@Brock – that’s a great way to think about it. Getting ready to retire is mental, emotional and financial. My mom didn’t like being retired but my dad loves it. I guess it just depends on the person.
@Kathy – it sounds like you guys really prepared for retirement and it’s great that you were on the same page. That’s really important for couples when it comes to money.
Very interesting conversation. My parents are in the midst of this conversation and the whole thing probably warrants its own post. My mom was just forced to retire several months before she was eligible for medicaid, after more than 30 years with the same school district. She is somehow less concerned about her financial situation than I am. I have more money saved for retirement at 36 than my mom does at 65, but we both have different comfort levels and experiences with money.
My father died right when he would have had the ability to retire, so like Kathy that plays into my thinking as well.
I don’t imagine myself to be working for an employer at the age of retirement, but would predict that I’ll still be working for our various businesses well after that age. So long as I’ve got scheduled time to play and travel, I think that would suit me best in any case. Like you say, it is a very personal thing.
I’m looking to retire well before I’m “eligible” so my planning is based on my money. When I have enough to make it, I’m out, easy as that :)
It really does comes down to comfort and planning, I think. I know I really need to work on my financial situation for retiring, but I don’t really know if I want to. Either way, I am looking at pages like http://www.mutualfundstore.com/planning-and-retirement and posts like this to help me get ideas.
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