For most people, the only message they ever hear about retirement is “save, save, save”. But no one ever tells you that you need a vision for retirement, says Kim Potgieter, a life planner and an accredited Certified Financial Planner at Chartered Wealth Solutions, who spoke at this month’s meeting of the PersonalFinance/acsis Financial Planning Club.
Potgieter spoke on “the new retirementality”, a phrase coined by American financial services consultant and author Mitch Anthony, whose book of the same title is reforming conventional thinking about retirement.
Potgieter says she has met many people who were dissatisfied when they reached retirement in spite of having saved enough. She says this is owing to the myths people have about this season of life.
“One of them is that retirement is an economic event. Saving enough is only one aspect of a successful retirement.
“Another myth is that retirement is the end of the road or some ‘finish line’, and only once you reach it can you start enjoying your life. Mitch Anthony’s message is: do today what you long to do,” Potgieter says.
“The next myth is that 65 is old. It’s not.
“Another is that a life of ease is our ultimate goal. If all you’re looking forward to is a life of golf, you’re setting yourself up for disappointment.
“A common myth is that you don’t need the help of a financial planner. We all need someone to coach us on the journey, because when we go it alone we make some ridiculous mistakes. A planner is there to help you stick to the game plan.”
Potgieter says no matter how old you are, you should be thinking about retirement. “Ask yourself what retirement means to you, and decide how you want to retire. Is retirement sitting in your armchair with the remote control in hand, flicking through TV channels? If that’s what you’re looking forward to, I’m encouraging you to look for more.”
Retirement is no longer about retiring from the world, she says. Nor is it about fulfilling your dreams.
“That can happen at any time of your life. It’s very sad for me when clients of 45 tell me they hate their work and are counting the years to retirement. If that’s you, you need to make a change today.”
Potgieter says our failure to change our lives and to plan for retirement is usually due to a lack of vision.
“This applies to all of life: what is the vision you have for your life?”
She says that before she can help a client, she seeks to understand what they want for their lives.
A financial planner can help you work through a dream so that you know what you want your life to look like in retirement, she says.
“A financial planner can not only ensure that you are getting a return on your investment, but also a return on your life,” Potgieter says.
She says there comes a time in our lives when we ask ourselves important questions, such as: Do I have a meaningful plan for the second half of my life? Am I living the life I want to be remembered for? Do I need to be doing something different?
“A lot of people ignore this inner voice and they’re usually the ones who end up miserable in retirement.”
Potgieter says it’s important to listen to these questions, and only you can answer them.
“It’s advisable to include your partner in these conversations, because you design your future jointly. It can be very difficult to have these discussions – because we’re inclined to want to please our partners, but it’s important that you communicate your dreams and goals.”
Potgieter says your responses to these questions should prompt you to start putting in place some “parallels”.
“Let’s say you always dreamed of being a writer. Start going on writing courses now.” The objective here is to shift to doing something that is of significance to you.
HOW TO LIVE AND RETIRE WELL
To retire successfully, you need to attend to all areas of your life, Kim Potgieter says. Even if you aren’t yet in retirement, your life should have the following ingredients:
1. Money. It’s important to save enough money for retirement, but it doesn’t make for a happy retirement, Potgieter says. To make her point she tells of a client who retired with pots of money but was miserable. He sought her services because he thought he wanted a higher return on his investments. But Potgieter realised what he needed was a return on his life – to get more value out of his money.
“He was hating being retired. He spent his days ferrying his grandchildren around to help his daughter, who was doing a job she hated.”
Potgieter went through his portfolio and it was substantial. His daughter stood to inherit it all.
“So this client wanted me to help him get a higher and higher return so that he could leave his daughter an even greater inheritance. I suggested he give her some of her money now to enable her to make some changes to her life, releasing him from his obligations to her and freeing him to do the things he wanted to do.”
Potgieter says her client agreed to her plan and is getting a better return on his life. “He has started to live and enjoy the money he has spent years saving. Because ultimately, what are we all putting it away for?“
2. Health. It’s no use having all the money in the world if we aren’t in good health. The greatest wealth is health, Potgieter says. “These bodies are vessels to get us through life. Can you expect your body to carry you through a happy retirement if you don’t treat it well? Health is also about the mind. We need to manage our stress by exercising. You are never too old to start,” says Potgieter, who has a client who joined Walk/Run for Life at 74.
3. Relationships.“Clients always say that their most important relationship is the one they share with their spouse, but it’s the one you have with yourself. For you to be of any value to anyone, you need to have a good relationship with yourself, by listening to yourself and knowing what you need.”
She says the next most important relationship is with your partner. “It’s frightening the divorce rate in retirement – all of a sudden this person who is used to being at work all day is now at home all day. I see horrified faces when I’m speaking to clients and the wife is so excited at the prospect of having her husband go shopping with her and he’s thinking: ‘I haven’t done all this my whole life so that I can push the shopping trolley around for you’. The same goes for wives who have been leading full lives and are suddenly expected home by lunch time to feed their husbands!”
It’s about communicating and understanding that wanting different things is not necessarily bad, she says.
Your relationships with your children and grandchildren as well as your friendships are also key.
4. Play. George Bernard Shaw said: “We don’t stop playing because we grow old. We grow old because we stop playing.”
Potgieter says travel is a favourite activity for people in retirement, but it’s not the only way to pass time. “There are hundreds of great hobbies to be enjoyed. We are our worst critics. We label ourselves as ‘not creative’ or ‘not musical’. But what did we enjoy doing before we got so hard on ourselves? What did we love to do? What brings out your creativity? Don’t wait until retirement. Start now. We compare ourselves to the best, but being the best isn’t the point. Enjoyment is.”
5. Work. Potgieter says work is about doing something where you are adding value but not necessarily being paid. “It’s important to stay involved in the world, so continue working – this may mean serving on the board of the company you worked for or transferring your skills. Carry on working rather than seeing retirement as the time to give up.”
6. Purpose. Potgieter says for most people purpose is a spiritual pursuit. “It’s important to ask yourself: what is it I love doing so much that I lose track of time?”
7. Give back. She says involving yourself in a charity is an easy way to do this. “Here you need to play to your strengths. If you’re an accountant, consider serving on your church’s finance team rather than volunteering to serve tea and coffee after church.”
8. Learning.“You’ve heard the saying ‘if you don’t use it, you lose it’. Well, the same applies to your mind, and you are never too old to learn,” Potgieter says.
To help clients asses how they are faring in all areas of life, she gives them a wheel of balance to colour in. “When you see it in colour, it shows what areas of your life are out of balance.”
Another exercise she uses to help her clients create a vision for retirement is a bucket list – a wish list of things to do before they “kick the bucket”.
“Drawing up your bucket list is not a frivolous thing. List all you want to accomplish or enjoy in your life – and set out to do it,” Potgieter says.