When someone says the word retirement, what thoughts come to mind? Is it the freedom to travel? Is it thinking of a time in the future where you can pursue your personal interests and hobbies? Or, maybe you haven’t given it much thought yet because retirement seems so out of reach. In either case, I hope this post provides you with some valuable information to get you thinking more strategically about your retirement.
There are 3 general ways people approach or enter retirement:
1) The Traditional Approach – This would be where you work until age 65 and retire on social security and personal savings. Don’t be fooled into thinking this approach is an automatic. In order to retire, even by traditional means, planning is required.
2) Early Retirement – For some people, early retirement is achieved before the age of 65. This is something anyone can do with proper planning, understanding and determination. If you’d like a good place to learn about how to retire early, check out Early Retirement Extreme
3) Never Retire - The dreaded no retire option! Some people simply never retire; they work until their last day. While some people purposely select this route, most of the time this is the result of a lack of planning.
So, now that we have a general idea of the 3 ways people retire, where would you say are? Have you thought about it much? If you haven’t started the planning process, you are most likely headed for option 3. If you want to change things, keep reading.
Define It!
Before we considering changing things around, we need to define (you need to define) what does retirement mean? Let me give you my abbreviated definition: Retirement is the ability to have the financial independence to do whatever I want to do, whenever I want to do it. It is the freedom from financial strain. Notice that I didn’t mention not working in my definition? This definition needs to be personal for you. If I were to ask 100 people if they wanted to achieve my definition of retirement, I would guess half would look at me with a blank stare and the other half would say yes. This is because a lot of people never consider their retirement; so, they don’t even think it’s possible.
Survey Says
A 2009 survey conducted by Vanguard, “Approaches for Retirement Security in the United States”, revealed the following in regards to who is actually prepared to retire:
-30% were prepared for retirement
-30% were potentially prepared for retirement
-40% were not prepared for retirement
The Importance of Perspective and Attitude, Conclusion
The results of that survey can be looked at in 2 ways: We could say that 70% of Americans are not prepared for retirement; we’re doomed! Or, we could say that over half (60%) are either prepared or potentially prepared for their retirement. Here are a couple of questions to ask yourself. First, which of the 3 retirement “roads” would you say you are currently on (traditional, early, or never retiring)? Are you happy with where you are?
The good news is that you can make an upgrade if you are willing to do the work. In my next post, I will talk about how you can make that upgrade to your retirement. This will give you a completely different perspective on your retirement and may even cause you to see possibilities you never thought of. Until then here is a concept to consider: Retirement by Design where you are the architect.
If you want to get a head start to see how much you will need to retire comfortably, check out the following post:
How Much Money Will I Need For Retirement
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very few Americans are ready for this.