When should you begin planning for your retirement?
While most of us don’t think about it, a good time to start is when you begin working–at least as far as financial planning is concerned.
Most of us don’t do that. We have some notion we should put some extra money aside for a few decades in the future when we quit working for a salary but, when it comes time to decide between a practical, inexpensive car or the shiny model with the bells and whistles, many people opt for the bells and whistles. The result is more money spent on the car, insurance and maintenance when some of that money could have gone into an account for future retirement. (Or just enjoying that expensive coffee two or three times a day! See how much difference a few dollars a day could make during your federal career)
Most of us will have 30 or more years of retirement. It is a chance to do all those things you wanted to do but haven’t gotten around to doing.
But failing to plan can lead to disappointment, boredom and an early demise.
Money is obviously going to be important. Without enough money to live comfortably, you may spend most of your time thinking about what you wish you could do.
But there are other major considerations in addition to money. Are your only friends those with whom you work? How will you spend your time? Have your talked with your spouse about what both of you expect during retirement?
If you are within several years of retirement, you will want to give consideration to these issues as much as you do to the financial side of retirement planning.
When some people retire, they feel they have lost their identity. How will you see yourself when you are no longer going to the office or the workplace? In other words, who are you or who do you want to become during that 30 years or so of not going to work at your old job?
You will want to continue to have a purpose and a sense of achievement. Perhaps playing golf was fun on Saturdays when you were off on a weekend. Do you want to play seven days a week and, if you do, will that be enough to keep you satisfied?
If you have only one interest, you probably need to spend some time planning before walking out the door one last time.
In your planning process, take the time to write down what you intend to do and how much time you want to devote to these activities. Design a retirement plan based on your interests and your situation, taking into account your health and the interests of your spouse and family members.
Finally, knowing what you want to do when you leave your career can make your job more enjoyable. It will give you something concrete to look forward to when you collect your monthly retirement check. In effect, you will be working toward an enjoyable, personal goal and not just putting in time at a desk to build up a higher annuity or to show someone they can’t force you to leave.