Seven decisions you will never regret

Seven decisions you will never regret

by | Oct 29, 2014 | Happiness, Health, Retirement

One of the benefits of my job is that I get to see a large group of people all making decisions about the same thing: Retirement. Over the years, that has given me a large data set of decisions and their consequences. Some of those decisions are minor, while others have consequences that ripple out for decades. Some of those decisions pay off big, while others tend to blow up—often in spectacular, catastrophic, almost comical fashion.

Below are 7 decisions—big and small—that will impact your happiness, fulfillment and options during retirement. They are decisions you will never regret.

The decision to decide. Recently a palliative nurse recorded the regrets of her dying patients and compiled them in a book called “The Top Five Regrets of the Dying.” The number one regret was “Not living the life I wanted.” To avoid this regret, you need to (Surprise!) decide what kind of life you want to live. But don’t stop there. Once you decide what you really want out of life, you need to start taking those plans very seriously. Imagine the satisfaction you could have if you arrived at the end of your days knowing that you did everything you possibly could to live the life that you wanted. For some practical ideas on how to do this, read Part 3 of the Intentional Retirement Manifesto A Brief Guide to Retirement Bliss.

The decision to “cut the branch.” A month or so ago I brought in an expert to help me trim and prune the trees in our yard. Most of the work went pretty quickly until we got to a large tree in our back yard. He informed me it had a branch that shouldn’t be there, but it had been allowed to grow for so long that cutting it now would make the tree look a bit silly for a few years. As I pondered what to do I asked him “When that little branch started growing ten years ago, should I have cut it then?” He said yes. Then I asked him “Ten years from now, will I look back on today and wish I had cut the branch?” Yes again. So I fired up the chain saw (it was a big branch) and started cutting.

No doubt each of us can listen to that story and use the branch as a metaphor for something in our own life. What is it for you? A job? A relationship? An unhealthy habit? Whatever it is, maybe now is the time to cut the branch.

The decision to do less. If you’re like most people, your default setting is for more. More commitments, more work, more stuff, more relationships, more money, more sporting events for your kids, more television, more house, more projects. More, more, more. The funny thing about “more” is that it can be incredibly diluting. If you have 30 projects at work, for example, you’ll probably have less impact than if you were allowed to focus on 3. This is the paradox of more. The more you try to do, the less you end up doing. If you want to do more, figure out a way to do less. Cut the unimportant (especially in retirement) so you can free up space, time and money to focus on the things that really matter to you. Less > More.

The decision to improve your marriage. Middle age is a risky time for your marriage. Hardly a year goes by that at least one of my clients doesn’t call it quits in that phase. This year was particularly bad. Divorce is never fun, but it’s even less so when you’re on the doorstep to retirement. Your assets get divided in half. Your kids will likely take sides. Your friends will certainly take sides. The dreams you had for “Someday” are off the table. How much better would it be to enter retirement in a happy, fulfilling marriage—plans, family and finances in tact—ready to enjoy the next phase? Yes, that takes work. Especially if the problems have been allowed to fester over the years. But take a long, hard look at the consequences before deciding that divorce is a better option.

The decision to bury the hatchet. A client called me earlier this year and told me that her ex-husband had just stopped by. They had been through a messy divorce due to infidelity about 20 years previously and hadn’t spoken since. Needless to say she was a bit surprised to find him on her doorstep with tears in his eyes. He wasn’t there to try to fix things. They had both moved on and married other people. He simply wanted to apologize and ask for forgiveness. My client later found out that when her ex left her house he went to her parent’s house and several other people in the family and did the same thing. It’s tough to go through life without hurting someone or being hurt by someone—usually our kids, friends, spouse or extended family. Carrying that baggage around can cause bitterness, resentment, and regret. Why live with that pain year after year until one of you eventually takes it to the grave? If it was your fault, acknowledge as much, apologize and ask for their forgiveness. If it was their fault, have grace and move on.

The decision to bet some chips. Have you ever seen the movie Rounders? It’s a movie about a poker player, starring Matt Damon. I was watching it on Netflix the other night and a quote stuck with me. Talking about poker Damon said “You can’t lose what you don’t put in the middle. But you can’t win much either.” It’s easy to play life too conservatively. God knows I’m guilty of this more often than I’d like to admit. Too often we go through life unwilling to take a chance and bet some chips. This can feel safe in the short run, but like Damon said, it never results in much of a payoff. Is there something that you’ve always wanted to do, but been afraid to take the risk? The clock is ticking. Maybe it’s time to bet some chips. Win or lose, you’ll at least have the satisfaction of having tried.

The decision to get healthy. Most of my clients are in the 50-75 age range. They seem healthier than most, but here’s an abbreviated list of health problems that they have dealt with so far this year: prostate cancer, breast cancer, diabetes, hernia, heart attack (survived), kidney stones, dementia, severe back pain, glaucoma, TIA stroke, broken wrist (due to osteoporosis), arthritis, lung cancer and depression. Those are just my clients, just in the last 10 months. Health problems are a fact of life as we age.  Obviously we can’t prevent all illness, but doing everything you can to be healthy can improve your odds of a long, active retirement.

~ Joe

Your biggest retirement expense (and how to get rid of it)

Your biggest retirement expense (and how to get rid of it)

by | Oct 7, 2014 | Debt, Housing

Let’s take a poll.  What do you think will be your biggest retirement expense?  Travel?  Healthcare?  Plaid pants?  Mai Tais?

Actually, according to a recent report by the Employee Benefit Research Institute (EBRI), you’ll likely spend the most (40-45% of your budget!) on housing.  That’s right.  The Casa. Good old home sweet home.  Nearly half of your income will likely go to cover things like your mortgage, taxes, utilities, and maintenance.

For some reason this doesn’t sit well with me.  Just like the argument for life insurance becomes less compelling as we age, it would seem to me that the argument for spending the lion’s share of your budget on housing becomes less compelling as well.

Yes, there was a life stage where it made sense to spend heavily on housing.  You hadn’t saved much and needed to borrow.  You needed space for a growing family.  You wanted to be near good schools.  A nice house was comfortable and conveyed a certain amount of status.  But are those reasons as compelling in retirement?

After the EBRI report came out, most articles I read on the subject focused on how retirees could cover such a large expense.  But what if you reframed the debate from “How?” to “Why?”  WHY spend such a large portion of your income on shelter?  Especially during retirement.  Every dollar you spend on shelter is a dollar that you’re not spending on travel, hobbies, and other pursuits that provide meaning, purpose, fulfillment, and enjoyment.

Quick Note: I am NOT saying that having a nice house in retirement is bad.  Some have their house paid for and it’s a low cost option.  Some can totally afford a nice house without it impacting their other plans.  For some, the house IS their plan (e.g. a place for kids and grandkids to gather, a neighborhood close to friends, a place to entertain, etc.).  The only time where an expensive house might become a problem is when the costs associated with it prevent you from being able to afford the things you really want to do in retirement.  If that’s the case, I think it’s worth considering alternatives.

With that said, I’d like to ask you three questions that will hopefully challenge your thinking on your house and just might lead you to pare back your spending on shelter so you can maximize spending in other areas that matter more to you.

Question #1: What would it take to pay off your house before retirement?

One way to reduce your housing expense would be to outline a plan to have your house paid off by the time you retire.  You’ll still have expenses like taxes, insurance, and maintenance, but you’ll no longer be paying principal and interest on a loan.  Here’s a post that will walk you through how and why to retire debt free.  And if you want to play around with different payoff scenarios and run some amortization schedules, the app “Debt Free” is helpful and simple to use.

Question #2: Would your retirement be better if you made a conscious effort to downsize and simplify?

A few months ago I interviewed Joshua Becker of Becoming Minimalist (you can listen to the full interview here).  We talked about ways that you can simplify life, minimize stress, and focus on what you really want out of life and retirement.  One of those ways was to declutter your house and possibly even downsize to something smaller.  This frees up time and money to focus on other priorities.  If simplifying sounds appealing, check out the Intentional Retirement Pinterest Page where we have boards for things like cooking for two, tiny houses, and the art of simplification.

If you want to go one step further, I personally think it’s worth at least asking if homeownership still makes sense for you during retirement.  Taking care of a house is more difficult as you age.  You don’t have the same space needs. It ties up a huge chunk of your nest egg.  If you compare owning vs. renting, you might find that owning is not the “no-brainer” that it was during your working years.

Question #3: What if you redefined status in retirement?

Let’s be honest.  Our culture confers a great deal of status based on things like homes and cars.  It’s easy to get sucked into that game.  Especially when banks are more than willing to put you in debt up to your eyeballs so you can make a good showing for the neighbors.

What would happen if we started to buck that trend?  What if, instead of the currency of status being “stuff”, we started to make it travel, purpose, time with family, happiness, and freedom.

A year or so ago I read about a couple living in California who spent about $7,000 per month on housing, cars, groceries, eating out, entertainment, and vacations.  They wanted a bit more adventure during retirement, so they sold the house and cars and hit the road with the goal of extended stays in interesting places for the same or less than what they were spending in California.  They stayed several months in London for $6,800 per month.  Florence and Paris were a bit less at $6,050 and $6,550 respectively.  Buenos Aires was a comparatively modest $4,400 per month and Mexico was practically a bargain at $3,450 per month.

Is this for everyone?  No.  Should we do those things simply for the status associated with them?  Definitely not.  Climb the mountain so you can see the world, not so the world can see you.  But if we’re going to admire people for something, we could pick worse criteria than looking up to those who live a full life.

Bottom line – think through what’s important to you during retirement.  What do you really want to do?  Once you have that list, invest heavily in those things.  If your house is on the list, great.  If not, don’t allow it to consume most of your resources at the expense of everything else on your list.

Joe

Photo by Joe Hearn.