Most of the resources you find on preparing for retirement relate to financial matters. Yet experts suggest that you should pay as much attention to your psychological portfolio as your financial one.
Last month we looked at how to get ready for retirement from a financial perspective. Today we’ll consider different aspects of retirement’s psychological impact. By thinking about mental and emotional changes you may face ahead of time, you’ll be more ready for them in the future.
Retirement’s psychological impact is real
There are tons of books and websites on how to prepare financially for retirement. They include topics like:
- How to save for retirement
- Whether to convert your traditional IRA to a Roth IRA
- Savvy tax moves now and/or when you retire
- Whether to pay off your mortgage and/or downsize your home
- Smart estate planning tips
- Etc., etc.
It’s critical to plan how you’ll use your money in retirement. But people often focus on financial preparation and neglect psychological preparation.
To make things worse, cultural norms make people hesitate to talk about how they really feel as they transition to retirement life. They’re supposed to be living the good life, right? And so they avoid disclosing common post-retirement psychological issues – even to close friends.
But issues are there nonetheless. According to a 2006 working paper from the National Bureau of Economic Research, retirees experience 5-6% more physical illness and a 6-9% decline in mental health during the first six years of complete retirement.
Don’t become one of these statistics. Get equipped now to deal with emotions you may experience later.
Shifting concepts about retirement
To understand retirement’s psychological impact, we need to examine how our concept of retirement has changed.
Retirement used to consist of a handful of years when you got to rest from a life of manual labor. But over time, work became less physically demanding.
Consequently, a mystique developed around retirement. It was a magical time you could enjoy as your well-deserved reward for a lifetime of work and sacrifice.
Modern retirement, however, is taking on new dimensions. People are living longer, feeling better and wanting to keep working. Or to try second or third careers.
In the past, retirement was the beginning of the end. Now it’s more of a transition to something new.
Retirement in the 20th century
When Social Security went into effect in 1935, life expectancy was 61. Over time, more people lived past 65 and began to collect Social Security income.
Real estate developers saw opportunities to build large retirement communities in places like Florida, Arizona and Southern California. They marketed the warm weather, an active lifestyle and easy living. All of which you could afford with your Social Security income and pension benefits.
Due in no small part to these marketing messages, retirement came to be thought of as the golden years. Those years after a lifetime of work when you could pursue leisure as your top priority.
The problem was, people started to live longer and longer. And not everyone wanted to spend 30 or more years playing golf and bridge. Or living in a community of “old people.”
Even as the cost of living grew, lots of companies eliminated retirement pensions. Social Security benefits covered a smaller and smaller portion of retirement living expenses.
Retirement in the 21st century
If you make it to age 65 today, you’ll live until 84 (men) or 86.5 (women) on average. One out of three seniors will live past 90, and one out of seven past 95.
The traditional notion of retiring at 65 conflicts with people’s sense that they still feel good and don’t want to stop working. Plus, increasing longevity has most of us worried about running out of savings if we retire too early.
Thus a new concept of retirement is emerging. One where you might retire from a demanding career to do something different. Something that requires less time and is less stressful.
Or something that’s simply different from what you’ve done for the bulk of your career. Something that presents a new challenge, allows you to give back to your community, stimulates you to keep growing personally.
Some people call this semi-retirement. Others call it reinventing themselves.
It might mean taking on a low-stress job that helps pay the bills but doesn’t keep you up at night. Or joining the gig economy or doing consulting, to keep your time flexible. For some, it means starting your own company or non-profit organization. There are tons of options.
How retirement can affect your mental health
Retirement’s psychological impact results from the fact that it’s a major life change. A change to how and where you spend your time, who you spend it with, how you find happiness and satisfaction.
Often the first six months or so of retirement feel blissful. You get to sleep late, do things you’ve been wanting to do but couldn’t fit into your schedule, take a long vacation.
Then reality sets in. Some common issues people experience in retirement include:
- loss of your career identity
- lack of support networks you had enjoyed through work
- spending more time with your spouse
- having more free time but less money
- dealing with family expectations (like babysitting)
Retirement’s psychological impact is broad
Retirement doesn’t just affect the person who stops working. It has repercussions for spouses, too. A moms who took time off to raise her families may have returned to work and just hit her stride about the time her husband wants to stop.
Stay-at-home moms also have to make big adjustments if their husbands retire. Couples who grew accustomed to daily time apart may not enjoy being around each other all the time.
Big friction over little stuff
Retirement means it’s time to renegotiate household tasks. Maybe you and your husband fell into a pattern where you did most of the housework and cooking during years when you were caring for the kids.
But now you have other things on your agenda and would like help with the laundry, shopping, cooking, etc. Time to reassess and reallocate.
Assuming your husband is willing to take on some chores, there still will be issues. He may do things differently than you would. You both will have to adapt to a “new normal.”
Professional help for a successful transition
This is a great time to consult with a marriage therapist. He or she can help you make the retirement transition.
A 2015 study by Fidelity shows that 1 in 3 couples are not on the same page with regard to their retirement lifestyle expectations. A counselor can guide your discussions and help you set a positive course for retirement together.
By talking about your hopes and plans for this next phase of your lives together, you’ll strengthen your relationship in the years to come.
Your psychological retirement portfolio
The bottom line is that as you save money for retirement, you also need to prepare psychologically. It’s a major life transition that affects the person who stops working as well as the spouse.
Acknowledge the emotional significance of retirement and talk about your feelings. Seek professional help and work through challenges together with your spouse. You’ll emerge stronger than ever to face your life’s next chapter.
What do you see as the biggest psychological challenge in your retirement years? Let me know in the comments below!