Money – Why it’s not the answer to a dream retirement
It’s all about the pension pot
We’re often told that to enjoy a healthy retirement, we need to be adding extra pennies into our pension, that saving more or for longer is the answer. In this day and age that advice is, in my opinion, irresponsible and fundamentally wrong.
Historically, money (pensions, savings and investments) has been the key focus of retirement planning, but that needs to change – and to change now.
When I was forced into retirement, I was financially stable. I had the funds to do whatever I liked. I wasn’t worried about money and yet, I was deeply unhappy. The reason… I was unfulfilled. My life just didn’t have purpose. There was nothing to get me out of bed in the morning.
Don’t get me wrong, I didn’t just wander aimlessly through the days, weeks and years. I wrote – a lot and I busied myself with sorting out complex family affairs. I had a purpose, but it wasn’t enough.
Retirement today can be long and as I know from bitter experience, unless you plan for it in a holistic way, you’ll walk a slow, dreary path towards death.
Now I know that sounds dramatic, but it’s true and I believe this so deeply that I’ve dedicated my life to helping others avoid that fate.
If a large pension isn’t the answer, what is?
Over the past couple of years, I’ve talked to thousands of retirees and pre-retirees, and they’ve given me a unique insight into their lives.
Half of the 23,000 people I’ve surveyed say their health and wellbeing is their biggest concern in retirement.
Over a third say they’re anxious about outliving their savings and the rest say the thing that causes them the most stress is having a lack of purpose. So, if 65% of people say their biggest worry is something other than money, why is no one addressing this?
Similarly, in a recent study in the US by Edward Jones and Age Wave, 85% of Americans said having good physical and mental health was key to a successful retirement. Far fewer considered wealth to be the answer.
How to stay healthy
In 2019, the IZA Institute of Labor Economics in China alongside Binghamton University of the United States released the results of a ten-year study of Chinese people who’d been receiving a state pension. The most striking discovery was that this group of people, who weren’t doing anything to maintain their cognitive abilities, were losing them. Their brains were slowing down in the same way they had.
We now know that this loss of brain function leads to Alzheimer’s and dementia. This lack of purpose is the main reason that one in three adults over the age of 85 in the US has Alzheimer’s or dementia. If we know this, why aren’t we helping people to maintain a focus in their latter years? Why aren’t we helping them plan for a retirement where they have a sense of purpose and self-worth?
I read with interest an article in The Week magazine. It was a diary of a scientist in his 90’s.
In it he said this: “Old age is what others attribute to you. To a great extent, age is a state of the mind. I take pleasure in working on my computer on science, religion and culture. I have learned a lot over the years but the most important thing I always follow is: be useful to yourself and to others. Keep your mind and body fit by reading and ruminating, and by doing walking exercises.”
Society’s attitude to old age merits a blog (or a book) in itself, but what really stood out to me is the fact that this scientist had reached this great age by having the right mindset – by maintaining his mind and his body and by doing something that still gives him pleasure and purpose.
He goes on to openly admit his brain is not as active as it used to be – he’s 75% deaf and he struggles to hold an in-depth conversation on a new scientific discovery, let alone make one – but he’s still going strong.
What am I doing about this?
Personally, I ‘unretired’ myself as soon as I could, and dedicated my life to helping people plan holistically for retirement and/or change course once they’d come to the realisation the retirement they’d dreamed of, wasn’t a dream for them.
This keeps me active, fulfilled, mentally challenged, and also brings in an income. Win win!
BUT – there’s always one isn’t there… and this BUT is BIG…
It’s all well and good me highlighting this issue in a blog post and trying to enlighten as many of you as I can through my webinars, courses, books and resources, but this is a battle I can’t win alone. Throughout history money has been the key focus in retirement planning and it’s going to take a huge societal shift to change that.
I’m always up for a challenge and that’s why I’ve been talking to financial advisors across the US, Canada and the UK. I’m showing them that a holistic approach is needed and that their clients will be happier, healthier, more fulfilled and ultimately save more if they are set on a path to a dream retirement that will sustain them mentally, physically and financially through their latter years.
Related pension blogs by George Jerjian
– A retirement that’s more like winning a lottery? Three ways to help make that happen
– Wake up! You’re sleep-walking into retirement