By Eric Reich
I know we aren’t supposed to have regrets in life, but we all have them. As a retirement specialist, I have always wanted to know what regrets retirees in particular have surrounding their own retirement. Fortunately, there have been a fair number of studies over the years regarding this topic. According to the Employee Benefit Research Institute’s retirement readiness survey, roughly 70% of retirees would have saved or invested more and earlier. In my experience, those numbers are quite a bit higher. My retiree clients say they wished they saved earlier about 85% of the time and nearly 80% wished they saved more. While there is not much we can do to change this reality for these retirees, what we can do is take these lessons and pass these concerns down to younger generations. It’s never too early to start teaching the next generation how to save. When I probe further, I find that the main reason retirees didn’t start earlier is simply because they didn’t know where to begin.
Additional regrets retirees have can more easily be planned for. Surprisingly, many of the regrets are not financial ones. Issues around socialization tend to lead the pack. Walking away from a job is about more than losing a paycheck. For many, it is a loss of identity as well. We often identify ourselves by what we do for a living. Many times, it’s an opener to conversations, “What do you do?”. So much of how we see ourselves is a function of what we do for work. This can lead to a lack of purpose. Along with that comes a major concern for retirees which is a lack of social interaction. It happens subtly. You are newly retired and the social calendar if full, then 6-12 months later, your days are spent with your spouse only or alone. This has been shown to have very negative health effects for retirees. Make sure you are intentional about taking time to have regular social interactions with friends and family.
Not being flexible with your intended plan tends to come up as a common mistake. I frequently see clients have a very rigid plan for their retirement or final working years that might not always go as expected. Planning to work until 70 or 75 sounds great in theory, but there can be a multitude of factors that can prevent that. Health is an obvious factor in those plans. I have seen countless people have to cut their careers shorter than planned due to a change in their health. The same goes for things like vacation homes. While having 3 houses might work fine in your 60’s, it could become logistically challenging into your 80s or 90s. Be flexible with your vision of retirement and expect roadblocks along the way.
Lastly, the biggest regret I see with retirees is not addressing estate planning issues. I know, nobody wants to think about no longer being here. The older we get the closer it is to a reality and that’s why I think retirees what to ignore the situation. Unfortunately, there will come a time when we aren’t here, and ignoring that fact only makes an already difficult situation even harder for your family. Many retirees have expressed regrets about not dealing with their estate plan sooner and now they are left with fewer choices. Don’t be one of those people. Meet with an estate planning attorney and get all of your affairs in order to make life easier on your loved ones when you are gone.
Retirement is meant to be enjoyable. By avoiding the regrets of others, you can help to ensure that your retirement goes as smoothly as possible.
Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Reich Asset Management, LLC is not affiliated with Kestra IS or Kestra AS. The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra Investment Services, LLC or Kestra Advisory Services, LLC. This is for general information only and is not intended to provide specific investment advice or recommendations for any individual. It is suggested that you consult your financial professional, attorney, or tax advisor with regard to your individual situation. To view form CRS visit https://bit.ly/KF-Disclosures.
Eric is President and founder of Reich Asset Management, LLC. He relies on his 25 years of experience to help clients have an enjoyable retirement. He is a
Certified Financial Planner™ and Certified Investment Management AnalystSM (CIMA®) and has earned his Chartered Life Underwriter® (CLU®) and Chartered Financial Consultant® (ChFC®) designations. A lifelong resident of Cape May County, Eric resides in Seaville, NJ with his wife Chrissy and their sons ,CJ and Cooper, and daughter Riley.
