For decades, retirement has been portrayed as a permanent vacation: sunsets, golf courses, and travel. But the reality, as many retirees discover, is far more nuanced. Retirement isn’t just a financial milestone—it’s a personal and emotional shift that can bring new freedoms and new challenges.
As a financial advisor, I’ve worked with clients across all phases of retirement. Here’s what I’ve seen retirement really look like—and how-to plan for it beyond the numbers.
The First Phase: The Honeymoon Period
For many, the early stage of retirement feels liberating. After years of structure and responsibility, there’s finally time to travel, take up hobbies, reconnect with family, or simply relax. This period can last anywhere from a few months to a few years.
Financially, this phase can bring higher-than-expected spending. Travel, home upgrades, or bucket list experiences may draw heavily on savings. This is normal, but it should be anticipated in the retirement income plan. If the early years are not budgeted carefully, it can affect the sustainability of retirement income later.
The Second Phase: Adjustment and Redefinition
Once the novelty wears off, a more complex phase begins. Without the routine of work, retirees often face questions of identity, purpose, and structure. Some experience boredom or isolation, especially if social ties were tied to their careers.
This is when many clients reengage with the world—volunteering, consulting, caring for grandchildren, or even returning to part-time work. From a planning perspective, this phase requires flexibility. Retirees may need to adjust cash flow, revisit health care plans, or plan for new commitments.
It’s also a good time to assess estate planning, charitable giving, and how assets are aligned with evolving values and goals.
The Long View: Longevity, Health, and Change
One of the most overlooked aspects of retirement is how long it can last. For a couple retiring at age 65, there is a likelihood that one partner will live into their 90s. That’s 25–30 years of financial independence to maintain.
Over time, health issues, cognitive decline, or caregiving needs may arise. Planning for long-term care, home modifications, and potential assisted living costs is essential—even for those who feel healthy today.
This phase also requires regular portfolio reviews. As clients age, risk tolerance and income need often change. Tax strategy becomes more important, especially with required minimum distributions (RMDs), Social Security optimization, and managing tax brackets in retirement.
What Retirees Wish They Knew Earlier
Here are a few insights clients often share after they’ve settled into retirement:
o Retirement is not one continuous stage. It evolves.
o Having purpose and structure is just as important as having money.
o Health care planning should start earlier than most people think.
o Downsizing or relocating is more emotional than expected.
A Realistic, Not Idealized, Retirement Plan
Good retirement planning is about more than reaching a number. It’s about preparing for the transition itself. That means asking:
o What will your daily life look like?
o How will you replace the structure and purpose work provided?
o What flexibility is built into your financial plan?
o How will your needs change in 5, 10, or 20 years?
Answering these questions early—and revisiting them regularly—can help prevent surprises and can lead to a more confident retirement experience.
Final Thoughts
Retirement is not the finish line; it’s a new chapter with its own set of changes, both expected and unexpected.
From a financial advisor’s perspective, the most successful retirements are not those with the largest portfolios, but those that are planned with clarity, flexibility, and self-awareness. Knowing what retirement really looks like can allow you to make decisions with more confidence—and live this chapter on your own terms.
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Read more articles by Andrew Thacker