Reimagining retirement

Finances

Thinking ahead about your money, wellness, lifestyle

Produced in partnership with Forbes BRANDVOICE

 

Who will you be in the future? Imagining the answer can be a challenging mental exercise — and many of us don’t bother trying. A survey from the nonprofit research group Institute for the Future reports that 53 percent of Americans rarely or never think about what their lives could be like in 30 years.

If you’re not giving your future self more than a passing thought, you may want to. Life expectancy is steadily increasing, and you could optimize this longevity by planning for retirement in a new way. Research from Hal Hershfield, an Associate Professor of Marketing, behavioral decision making and psychology at UCLA Anderson School of Management, finds that visualizing our older selves and accounting for your future needs and desires may lead to decisions that can pay off in retirement.

Here are some creative strategies for money, wellness and lifestyle, inspired by Hershfield’s research, to help you envision and prepare for your retirement.

Money: financial planning for your future self
What opportunities and ambitions will you pursue in the future? Will you dive into a second act, try new hobbies or open a small business? Do you want to travel, spend money on grandchildren or build a bigger home to make room for visiting family?

Saving for retirement is tricky for many reasons, but answering questions about your future can help you optimize your savings and face down some common obstacles in financial planning. Even if you’re actively saving, it’s still tough to forecast how much you’ll really need. “People just grossly underestimate health care and long-term care costs in retirement,” says Grant Kvalheim, President and CEO of Athene USA, a provider of fixed annuities. “Plus, many of today’s retirement plans place heavy responsibility on the individual to identify any gaps they may have as they plan their financial futures.”

Consider these ideas to get started:

  • Carve out time. Even if you’re aiming to work as long as possible, it’s smart to plan for a future where that may not happen. Start the process by setting small, actionable goals to help you build financial literacy. For example, research a retirement plan that suits your outlook, schedule time on your calendar to educate yourself and discuss savings strategies with others. Are you currently working with a financial professional? If not, consider meeting with one. If you’re not sure who to see, ask family and friends for recommendations.
  • Do some math. What are your monthly expenses now? What might they be in a decade? How much is required to pay your mortgage, make a car payment and buy food? A monthly figure is easier to grasp and multiplying it can help you estimate the money you’ll need for the life you want.
  • Consider supplementing your 401(k). “We encourage people to have a full financial plan — a great way to save for retirement on top of a 401(k),” says Kvalheim. “A fixed-indexed annuity is pretty unique in replicating some of the features that people used to enjoy in a defined-benefit pension plan, which most people no longer have.”

Wellness: prioritizing health for your retirement
It’s never too early to prioritize physical and emotional wellness, especially if you hope to maintain an active lifestyle in your next chapter. However, just like financial planning, designing a proactive wellness routine that incorporates your future self isn’t always intuitive.

It’s hard to measure how incremental, daily choices — what to eat for lunch, whether to bike or drive, have dessert or abstain — can add up in a big way over time. It’s also challenging to imagine unforeseen health issues or think about how aging’s natural toll might impact the future. Yet, we could actually risk increasing the likelihood of a major health issue disrupting retirement if we disregard future realities.

Try these tips as you think ahead about your health and wellness:

  • Write about it. Craft a thank you note from your future retired self to current self. What healthy habits would you thank yourself for? Maybe it’s cutting out one sweet a week, walking a few extra minutes a day or taking a regular adventure outdoors.
  • Make it easy. Minimize the obstacles that stand in the way of nutrition and exercise. Keep a set of dumbbells near your desk or invest in a stationary bike, for instance, and have wholesome snacks on hand.
  • Treat yourself — in moderation. Indulging every so often can contribute to overall wellness — unless “every so often” becomes every day. Pay attention to the patterns that could undermine your future health.

Lifestyle: cultivating connections for your future
As you position yourself for a fulfilling retirement, savings and health are just part of the equation. Research points to the importance of social groups and meaningful relationships in retirement, especially since the transition can be jarring for some. By nurturing friendships and building strong support systems now, you may be able to preemptively combat potential loneliness or boredom down the road.

  • Exercise gratitude. Write an email to someone who helped you in the past. For both you and the recipient, the gesture could reinforce a lifelong connection that provides joy as you age.
  • Expand your circle. Explore hobbies and social activities outside of your career. Fostering a sense of purpose and having a space to connect with others may potentially ease the transition to retirement.
  • Enjoy today, too. Incorporating your future self into today’s outlook is essential, but it’s also important to value the present with the people you love. Retirement preparedness isn’t only about smart savings and healthy choices. It’s also about making memories that will enrich your golden years. Splurge on a family trip, commit to the home improvement you’ve been dreaming about and indulge in a dinner (and dessert) with friends. Your future self will thank you.

Professor Hershfield sums it up with this advice:
“If we spend some time to actually better envision who we'll be, where we'll be, what we'll be spending our time on, who we'll be spending our time with, then we can start to take the steps necessary to step into our future self’s shoes.”

This information is brought to you by Athene — where unconventional thinking brings innovative annuity solutions that can help make your retirement dreams a reality.

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