Nobody promised it would be easy to live 25 to 30 years in retirement.
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The fact is, human nature often gets in the way of planning effectively for retirement. Even when people take the time to learn about various retirement strategies and financial products and services, for various reasons, sometimes they just don’t get around to taking the steps they need to take to prepare for a potentially long retirement.
One reason is that many people don’t like to plan very far ahead, often living paycheck to paycheck instead of thinking even six months down the line. The trouble is with this strategy is that it just won’t work when you retire and your regular paychecks from working stop coming in. If you’re approaching your retirement years or have recently retired, you could live for another 25 to 30 years, and you need a serious plan for your health, financial security, and fulfillment that will last for the rest of your long life.
Cultivating good habits so you have a successful retirement is a critical part of your planning.
To find out just what habits are most essential, I turned to three financial experts who are household names: Jean Chatsky, Jane Bryant Quinn, and Robert Powell. They are all are seasoned, prolific writers on the topic of financial acuity.
One of Chatsky’s popular books, The Difference, examines the character traits of people who’ve thrived financially in any environment, which could be particularly helpful in today’s challenging times.
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Quinn’s most recent book is How to Make Your Money Last: The Indispensable Retirement Guide. This book focuses on how to generate enough money to last all your life and covers your living expenses, as well as the steps you should take to protect against the financial risks that most retirees will face.
Robert Powell is the editor of Retirement Daily, a comprehensive website that helps you finance a long retirement.
Let’s see what these experts have to say about planning for a successful retirement.
Build healthy financial habits
Both Chatsky and Quinn emphasize the importance of building habits that will lead to successful financial management over the long term. This means saving a sufficient portion of every paycheck; Chatsky specifically recommends saving at least 5% of every paycheck.
Another helpful habit is to set goals and then periodically check in with yourself to see how you’re doing. If you find that you’re not making the progress you’d like to make, you can reassess and make changes in order to get back on track. Good advice for today, since chances are good you might need to readjust your plans due to the pandemic.
Paying your credit card bills in full each month is another great habit these experts recommend you develop. This is particularly important if you need to live within a retirement income that might be less than the income you enjoyed while you were working.
Keep it simple
Quinn believes that “the simpler your financial arrangements, the more likely you are to succeed.” This means investing in index funds that research shows have outperformed investments in actively managed funds and individual stocks and bonds. It also means you should avoid buying complicated annuity products with high fees.
Develop successful personality traits
Chatsky advises cultivating the following personality traits for success: optimism, resilience, connectedness, gratitude. The good news, she says, is that we can develop these personality traits—it’s not the case that we’re stuck with the traits we’re born with.
In today’s challenging times, Chatsky emphasizes that resilience—the ability to adapt and rise above difficult times—is a particularly important trait to cultivate. Chatsky suggests “…controlling those things that you can control (typically your actions and not the actions of other people) and letting go of the others.”
Powell agrees with Chatsky, and adds “it’s important to be able to absorb and recover from shocks.” Sound advice for today, as we’ve all been hit with the shock of the pandemic.
Chatsky’s and Powell’s advice and suggested personality traits to develop are consistent with the secrets I recently shared from successful retirees whose insights are based on their life experience.
Trust your plan
Once you’ve developed a careful plan to guide you through a long retirement, Quinn recommends that you trust that carefully designed plan. She adds, “Let it run, while you get on with the rest of your life.” This is particularly sound advice today, when the pandemic is testing our patience and possibly casting doubts on our well-made plans.
While developing and implementing your plans will take hard work, you can do it! Since you’ve read to this point, you’ve demonstrated that you are a curious and serious student of retirement. Your perseverance and optimism will help you enjoy your retirement years, and you’ll be grateful that you took the time to plan for the best possible life in retirement.