We continue we this release in a 9-part series on Pensions ...arising from recent surveys and personal interviewing. Opening the series is Matching Pension to your LIFESTYLE ... Second is Matching Pension to Living Significantly. Now we focus on your view of LEISURE and what it can mean for early and ongoing seasons of retirement. So here is the third question, with our survey results and personal interviews on LEISURE as part of our retirement planning.
Your response to Survey Question #3:
Leisure now and for Retirement especially means . . .
In days of Lawrence Welk or Archie Bunker, the dream for retirement was rocking on the porch, watching TV, mowing the lawn, visiting with friends. Your dream and mine is probably bigger than that today. “Not my parents’ retirement” is a catch-phrase for some people. And in any event you’ve shared your own personal spin on the retirement you’re wanting to enjoy. Here the survey allowed two choices so we could capture a broader sense of your priorities and interests.
This picture comes from our largest survey, mostly age 50 to 70, answering their two top choices of leisure from the following list:
- Spectator events, TV, watching sports
- Physical activities and healthy exercise
- creating, cooking, writing, crafting/building things
- learning, reading, educational experiences
Above all other choices, 67% put their priority on TRAVELING. Some have already traveled through work and want less; others have found life and career prevents getting away so travel is more important for them than ever. Ponder of course that 75% fear they lack the money they need to travel as they wish (Q.1), and near 70% lack a financial plan to confirm such travel fits with their wealth and budget (Q.6 ...coming soon).
52% also highlight PHYSICAL ACTIVITIES AND HEALTHY EXERCISE which leads to a range of activities from low-cost cycling near home to the more costly hiking of Patagonia in southern-most Chile and Argentina. A friend of mine is currently touring Ireland, hiking paths along the sea (and posting awesome pictures of their daily activities onto Facebook). Such budgets can differ widely so the impact of PENSION DECISIONS and financial planning can be absolutely vital!
Third choice is “learning, reading, educational experiences”. Some will advance in college or higher studies; others will explore the vast opportunities for self-directed learning.
Fourth is “creating, cooking, writing, crafting/building things”. One person builds a boat. Another attends a cooking class to expand their interests and cuisine. Someone takes up sculpture. A long ago friend has been researching historical events and writing novels. No limits except our imagination!
Lowest support at 12% is “Spectator events, TV, watching sports” although I know at least a few who combine traveling (#1) with attending world-class sport competitions.
We clearly see ourselves as an active generation and we will RUN and press our way forward – not limping – into an active and engaging retirement. There’ll be time enough in some future horizon – what I call the more sendentary period – when we can sit by the TV or in the park watching what others are doing. For now though we’re ready to keep moving and enlarge our lifestyle -- spring into activities we’ve practiced already or will pick up along the way.
What does this mean for your pension choices?
One of the first things in opening a certified financial plan for my clients is learning what are their values for their future. What life, what activities, what lifestyle do you want to enjoy and enlarge through the opening and ongoing horizons of your future. And what budget is required to fulfil these lifestyle choices? As you can guess, someone putting 10,000 clicks on a bicycle each year may have a different budget from one hiking the trails of Europe and South America. *
* In Pension and Lifestyle ...#1 we mentioned the Camino Santiago in Portugal/Spain and suggested a variety of higher-cost versus or lower-budget activities that can fit into our lifestyle and our retirement spending.
Perfectly clear: pension choices should align with the personal "movie" you script for your leisure, lifestyle, and loved ones. Here’s where you get to compare the Flat-Line pension with the Life-Horizons Line. Are you more inclined toward a somewhat guaranteed income forever, or a more flexible approach that can adapt to the way you want to live? (and yes, requiring more strategy and ongoing review to safely sustain your plans.)
Take Rick and Lynn for instance: they laid out for me how they were going to travel and spend money for the first fifteen years of their retirement. They then outlined the type of seniors’ community they would choose to live in, signifying a second and more sedentary period when they expect to spend considerably less. Presuming we live long enough for health to decline, they agreed costs for personal care could push their budget up again in a later period of life. … And when you consider the people you’ve known and what seems likely for our own future, do you agree Rick and Lynn were taking the right approach in our planning?
SO if you agree with Rick and Lynn, and so many who foresee active and engaging lifestyles then consider: how does your pension plan fit with your life? Would you want a secure flat-line into the future (blue) or a more flexible income for the lifestyle you choose (red)? Which picture on the graph will make it easier to travel, to engage life actively each season, to provide experiences you and your family will hold dear forever?
If a pension is well funded to avoid possible cutbacks, the flat-income approach can let you live and spend according to how much money you’re getting. Gardening, occasional travel, reading, and many other activities can fit within such a pension. If you’re fortunate to have substantial additional savings, then any lifestyle is within your reach, using the flat pension as your base and other investments as supplemental.
OR LIFE AND LEISURE may need a more personalized approach to show the income you need for the lifestyle you choose, and how/when you will be drawing income. We also focus to reduce risks and align your investments for the sequence of your desired lifestyle and spending. This is the realm of "Life Horizons Analysis" to protect life and leisure and loved ones ... to our 90s and beyond.
Is now the time to get professional support? Is someone close to you needing assistance and confidence for their future? If we can help you or someone you know, phone or email me today. ...reach me today at...Brian Weatherdon, MA CFP CLU CPCA CRC, MDRT. 905-637-3500 x 223 627 Guelph Line, Burlington, Ontario. L7R 3M7. 1-877-937-3500 FREE x 223 Certified Financial Planner. Certified Retirement Coach. brian@SovereignWealth.ca