Financial Tips For A Happier Retirement


They say money can’t buy you happiness; similarly, money won’t ensure a happy retirement. That being said, not having enough money to retire is a problem many face. While happiness in retirement is rarely just about money, maintaining your standard of living as you age can, at the very least, help you avoid misery in retirement. Keep reading as we share tips to have a happier retirement.

What Do You Personally Want For A Happy Retirement

With more than 20 years as a fiduciary financial planner, I have seen people retire and adjust their expectations of the good life over time. What sparks joy at 55 may not bring you the happiest retirement at 65, 75, or even 105. Age may be only a number, but the lower your age, the better your health will be, usually.

We have seen time and time again that money cannot buy you perfect health. Whatever your age and health status today, find ways to be more active, eat healthier, and get the recommended screenings. Early detection can make many illnesses much more manageable, especially cancer. Of course, I am a financial planner, not a doctor, but I don’t think anyone’s dream retirement includes chemo.

Build Social Connections

Even if you are an introvert and dislike most people, having social connections is a good idea. This can be as simple as being active in a hobby or spending time with family. Studies have shown that a solid social connection and a good amount of physical activity are crucial for maintaining your health as you age. I recommend that all my clients think long and hard about how they will fill their days once they no longer work eight or more hours in an office daily. During the pandemic lockdown, we all learned how boring it can be to be stuck at home 24/7. (Yes, I know some of you loved the solitude).

Does Money Make For A Happier Retirement?

I can’t imagine going through retirement without financial security. According to Fidelity, more than half of Americans are not on track to maintain their standard of living in retirement. While I will admit money isn’t the only thing driving a happy retirement, not having money can bring a lot of misery.

Strive to save 10-20% of your gross income into a tax-advantaged retirement account like a 401(k), SEP IRA, or Cash Balance Pension Plan. Not only will you save money on taxes each year, but you will also increase your eventual retirement income.

Will Smarter Spending Bring More Happiness In Retirement

Cost and value are not the same thing. For example, if two couples took the same trip of a lifetime, stayed in the same level hotel, and booked the same class of airfare, it would be fair to say that they got the same value from the trip. But if one couple paid full price and the other couple booked at a discounted rate, like my mom always does when she travels, there would be an obvious difference between the cost for each couple. I will give my mom credit; she is the queen of stretching a dollar.

Not all smart spending strategies are this obvious. At the most basic level, spend on things that bring you comfort and happiness, and skimp everywhere else.

When developing your retirement spending plan, set aside a certain amount for fun splurges, like travel or tickets to see Hamilton. Some retirees find it hard to spend any of their lifesaving, even once retired. To help my clients have a happier and more enjoyable retirement, I often have them set aside a certain amount of money for fun things they would usually consider a splurge, like travel.

Many retirees might never leave their homes without a retirement happiness spending plan for these types of expenditures. That is a little facetious, but if you have the money you’ve earned, you can enjoy some of it. Of course, don’t go crazy and blow your life savings but set aside a certain amount of money for fun. If money is in the “fun account,” you know you can afford that cruise. With all the travel discounts, you could take even more trips. Just saying.

Should I Work In Retirement?

Many more people expect to work in retirement than do it. There are exceptions; I work with many successful business owners who love what they do and continue to work because they want to (rather than because they need to).

Yes, you can work in retirement, but should you? That depends. Many baby boomers today will need to work just to keep the lights on, while others will choose to work to keep their sanity. I dream about a retirement where I’m sitting on a beach sipping margaritas, but even that could lose its appeal after a long enough period.

In reality, people who work past 65, or have other passions or hobbies to pursue, often have the happiest retirements. Jobs get us out of the house, force us to interact with more people and often be more physically active. Also, the extra money never hurt anyone’s financial security. Whether volunteering or spending time with friends and family, finding meaningful ways to fill your days will lead to a happier retirement.

What does your dream retirement look like? Act today to make it a reality. Money may not be able to buy happiness, but not having any money sure sounds miserable.


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