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Retire-o-meter: Measuring Your Retirement Confidence

In the mid-70s The Gong Show used an ‘Applause-O-Meter’ when finalists would be rounded up at the end of the show and the audience would pick a winner via applause. A silly but useful tool. What if you could use a similar tool to rate your preparation for and likely success during retirement?

People I have talked with who are preparing for retirement focus the bulk of their energy creating and worrying about their retirement finances. This preparation is key to secure a successful retirement but it covers only one of four challenges faced during retirement. Those who have recently retired find that their security and success is based on their financial well-being as well as their physical, social and personal well-being.

During my research for Beyond Work: How Accomplished People Retire Successfully (Wiley, 2008) I learned what it takes to retire well and enjoy this new and different adulthood. These retired ‘New Adults’ understood that life beyond work is multi-faceted. Also, they were confident in their ability to live a meaningful retired life.

Understanding what is important during retirement and having the confidence in one’s ability to meet and master challenges differentiate successful retirees from those who are disappointed and unhappy. Understanding is increased with knowledge of what is to come, which increases security and lessens nasty surprises. Talking with experts in retirement, both professionals (accountants, financial planners, doctors, clergy and others) and friends who are a step or two ahead of you is a great way to build understanding. Reading books and articles helps to convert understanding into knowledge and eventually wisdom.

Confidence in the ability to meet new challenges and enjoy life is what pulls accomplished people through the tough times and actually improves their quality of life. This is true at all ages.
How confident are you in your ability to live well once you move beyond work? It’s a hard question to answer. Here are some additional questions:

How confident are you in your ability to:
• Build confidence in weak areas?
• Know which areas are weak?
• Monitor your confidence over time?
• Pinpoint specific challenges that you can learn to master?

As you probably suspect, these are loaded questions. The Roiter Retirement Confidence Profile (RCP) has been developed from the research conducted for Beyond Work. The RCP will help you to answer the questions above and provide you with ideas about how to increase your confidence. It can function as your ‘Retire-O-Meter’ confidence measure. You can complete the RCP at www.beyondwork.net

More than 800 people have completed the no-cost, no obligation RCP since it went on line in June, 2008. It has 20 statements about retirement that you are asked to consider and indicate your level of agreement. For example, how strongly do you agree with this statement: “I trust my judgment regarding financial matters”? The RCP will provide you with your current level of confidence on a scale of 20 to 100. It also provides you with confidence scores in your ability to maintain financial, physical, social and personal well-being. You can complete the RCP as often as you want to determine if you are improving your weak areas and maintaining your strengths.

My hope is that you can use the RCP to help you to build your confidence in your retirement.

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Beyond Work is the “Best Retirement Book of 2008”

Beyond Work: How Accomplished People Retire Successfully (Wiley, 2008) was selected as the Independent Publishers’ Axiom Award Gold Medal winner in the 2008 retirement book category.  The competitively judged Axiom Book Awards presents gold, silver and bronze medals in 22 categories.  “The judging is based on content, originality, design, and production quality, with emphasis on innovation and creativity. The judging panel includes experts from the fields of editing, design, reviewing, bookselling, and library science.”

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I was very pleased to learn of my book’s selection and I greatly appreciate the recognition of Beyond Work as a valuable tool for those considering retirement or recently retired.

Beyond Work looks at retirement as a whole life experience and describes the four sets of challenges and opportunities that people face as they move beyond work.  This time of life is much more than leaving work and managing personal finances.  It is about building a successful life by maximizing your financial, physical, social and personal well-being.  The book provides an overview of a successful retirement and specifics as to how to manage and improve your well-being.  Ideas are described using real life stories from the many people interviewed for the book.

Reviews from Amazon readers:

I am in my fifties and beginning to seriously consider retiring. I’ve seen lots of books about preparing yourself financially, and certainly seen “self-help” stuff describing how to be comfortable with yourself when you retire. But Roiter’s book is the first I’ve seen that knits all the areas to consider – social, financial, personal and physical – into an understandable, integrated picture. He uses common sense terms, and entertaining real-life examples, to explain how to prepare for what should be one of the best periods of your life. – From Looking to Enjoy Life

This book emphasizes the fact that not since you were very young have you had a chance to think or act on your own behalf. Now you can do what works for you. Using easy-to-grasp illustrations of the focus of our lives during various stages, the author opens up new possibilities for the “new adult” to look at what retirement has to offer. I have recommended this book to several people and each has responded with thanks and enthusiasm. (My broker bought it for her mother-in-law.) Several report their identification with the personal stories the author includes. The book encourages one to think differently about one’s life, retired or not. – From Dee Monroe

And more reviews are available on Amazon

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Retirement and Marriage

I can tell you that that retirement magnifies the quality of a relationship. Retirement is a stress test for marriages; good relationships get better and tough ones get worse. Part of this is simply due to the amount of time spent together. Both spouses have concerns about how they will spend their time. Moving beyond work obviously impacts a person’s daily schedule; use of time was taken for granted due to structured commitments, now everything is a decision. This is great for most, when we are working most of us look forward to the day when our schedule will be our own. Many may find this reliance on themselves for structure to be worrisome many. The spouse who has run the home may feel intruded upon by a career driven partner at home and the work oriented spouse may have limited experience with enjoyable non-work activities.

Problems can also arise for a couple when changes in personal priorities shift from being career driven to being self driven. This may feel to the person their spouse that their partner is becoming selfish. In some ways they are. Focus on what a person wants helps them to find direction or purpose in life, while it also helps to shine a light on what is meaningful. This can create a balance between what the person wants and what is important to them, like their spouse. It is one reason why so many people entering retirement find that they want to have both purpose and meaning in their life.

Most partners in a marriage are initially challenged by the sheer force of the shakeup experienced by such a major life change. This is not marriage specific; a person’s priorities change dramatically as they move beyond work and they naturally re-examine all parts of their life. My advice to couples who are preparing for or just entering retirement is to recognize that many thoughts and feelings will surface during this major change in how they live their lives. It takes about six to 18 months to settle into this new way of life. Be prepared to talk with each other about what is not working, and more importantly, what is working. It takes time to adjust, use it well.

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Hope for the Future

Today, January 20, 2009, is Inauguration Day and the world seems different. The weather, the economy, the world remain the same yet most people feel something rarely felt during the previous year – we feel hopeful.
Hope, the belief that better times are coming, has been in short supply in this country. I expect that hard core cynics are resisting this opportunity to believe in the future, but they are clearly in today’s minority. To be hopeful, we free up our thinking and become optimists. It is a happy example of how attitude can trump reality.
It will be up to President Obama to lead us and up to us to do what we can to harness this impermanent feeling of hope and turn it into a reality.
So what does this have to do with your retirement? Notice how you feel today. There are not many times when we can feel a pure emotion like hope. Note how it feels today so you can recall it in the future. We can all use as many positive experiences as we can get, and we enhance our enjoyment of them when we recognize them as they occur.

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Madoff’s Money Madness & Mistrust

I have not lost money due to the Maddoff scandal and would guess that neither have you. This was not because we have been savvy investors. No, it’s because we did not have enough money for Mr. Madoff to invite us into his exclusive club. Lucky us.

I have many clients who are considering retirement or who have retired. When working with them in seminars or individually I stress the importance of managing their money. My strong advice is to find a financial advisor they can trust and work with him or her to provide them with the information they need to make sound decisions. A financial advisor is as important in retirement as a good doctor and lawyer. Mr. Madoff’s crimes have now made my work to have my clients use a financial advisor all the more difficult.

Do you understand?

The first rule for building trust with a financial advisor is that the advisor should be able to clearly communicate his or her ideas to you. Being lost in a professions’ jargon should be a red flag to you that the advisor does not know how to work with you, or worse that they are keeping you confused and uncertain on purpose.

The Emperor Has No Clothes

It is remarkable to read the growing list of wealthy people who fell in behind the wealthy person ahead of them in line to throw their money into what is now known to be Mr. Madoff’s money pit. I read that a number of truly smart investors had professionals look into Mr. Madoff’s money management and they were so concerned that they reported him to the authorities; to no avail. Everyone believed everyone else and the emperor walked naked on Wall Street to the cheers of his supporters.

Who Can You Trust?

Begin by trusting yourself. If something does not feel right, explore it. Also, have two sets of independent eyes looking at your statements. Your first set of eyes is yours, you should learn how to read your investment reports and then read them. The second set of eyes can be independent financial advisor, accountant, estate lawyer, banker or another trusted advisor who understands investing and is motivated by your best interests. (If you do not have enough money to use a financial advisor to invest then you should for investments that are guaranteed or are very safe.)

People feel good about their professional investor when both performance and trust is high. Neither good performance nor trust alone can produce comfort for you. You really need both.

The following twelve questions can help you to understand your trust level with your financial advisor. It is one of 15 tools, charts and ideas offered in Chapter Five, The Financial Domain, of Beyond Work: How Accomplished People Retire Successfully (Wiley, 2008) that can help you choose and work with a financial advisor.

Bill Roiter’s[i] Twelve Questions to Assess an Advisor’s Trustworthiness

Here are 12 simple questions you can ask yourself to determine how much you trust your advisor or how much you may trust an advisor you are considering using. Read each statement and mark how true it is for you.

Trust Component:

My advisor is

To what extent is each statement true for you?

Not True

Somewhat True

True

Very true

1. Trustworthy

1. I can trust my advisor.

1

2

3

4

2. Attentive

2. My advisor listens to what I have to say.

1

2

3

4

3. Understanding

3. My advisor understands what I tell him or her.

1

2

3

4

4. A clear communicator

4. I understand what my advisor tells me.

1

2

3

4

5. Thoughtful

5. My advisor knows my situation and does not think of me as a general ‘type of client’.

1

2

3

4

6. Interested in my well-being

6. I believe that my advisor cares about me (is not just focused on the fees I pay).

1

2

3

4

7. Open to my ideas

7. My advisor welcomes my questions and discusses them with me

1

2

3

4

8. Competent

8. I feel that my advisor is skilled in his or her specialty.

1

2

3

4

9. Reliable

9. My advisor follows through on the plans we create.

1

2

3

4

10. Honest

10. My Advisor quickly takes responsibility for mistakes or problems.

1

2

3

4

11. Available

11. My advisor is available when I need him or her.

1

2

3

4

12. Compatible with me

12. I like my advisor as a person.

1

2

3

4

Sub-total for each column

Total of the four columns sub-totals

Range of scores = 12 to 48

12 = No trust

13 to 24 = Some trust

25 to 36 = Trust

37 or above = Strong trust

How did you rate your advisor? The higher the score the better. If your score falls between 20 and 36 you can look at the questions with the low scores and talk with your advisor about your concerns. You can use this Advisor’s Trustworthiness tool for all your advisors, not just your financial advisors.

Is Your Trust Warranted?

While trust is a major component of your work with a financial advisor you should have the advisor’s performance and credentials reviewed by a knowledgeable person you already trust. Remember that trust is not faith: always trust with your eyes open.

Do you trust your financial advisor? Why or why not?

[i] This copyrighted material is an excerpt taken by the author, Bill Roiter, from his book Beyond Work: How Accomplished People Retire Successfully (Wiley, 2008)


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Your Life Beyond Work

Welcome to this blog which is based on my book: Beyond Work: How Accomplished People Retire Successfully (Wiley, 2008).  The research I conducted for the book provided me with a new understanding and appreciation of retirement.  This understanding has deepened as I work with people considering retirement or recently retired, conduct daylong seminars for those considering retirement and as I write articles and work with the news media.  I will use this blog as a way to share my ideas and to learn from yours.

The idea of retirement as a retreat from the active world no longer holds water.   Today, our focus is not what have done, it is what we can do.  If I had my way we would retire the word retire and replace it with a word that represented the idea of moving forward.  As a realist I doubt that this will happen in our lifetime.

What I did learn from my research is that there is a true shift in how people in their 50s and above think about what is important.  This shift occurs whether you stop working for money or not.  From our early 20s to our 50s we typically have a life focused on our careers and our families.  Beginning in our 50s our priorities shift and what we want changes.  In effect, we enter a new New Adulthood, a time when we build on our career-focused life to create our new life.  As Career Adults most of us put our energies into building success at work and into raising a family.  The energy we had to spare we used to satisfy our personal needs and wants.  This what changes as we move beyond work.

New Adults have priorities that differ from what has come before.  We face four major challenges:

1.    Financial security as we reduce or give up our earned income.

2.    Physical well being as we age and manage our health.

3.    Social well being as we rely more on friends and family.

4.    Personal well being as we decide for ourselves what we need and want.

Do you know what you want?

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Did you know that 100 years old isn’t as old as it used to be?

I feel bad for the people who are 99 years old and looking forward to the big one-oh-oh.  Turning 100 is not what it used to be 20 years ago.  The centenarian club is more crowded than it used to be, with more than 50,000 members in the United States alone.  If you want to get the attention once given to people turning 100, you will have to wait an additional 10 years to become a 110 year-old super-centenarian.  In 2002 there were about 18 members of that club. (Source).

What this means for those of us considering retirement or recently retired is that this age inflation is due in part to the advancement made in medical care.  More 100 year-olds mean more people in their 90s, 80s, and younger.  Many once deadly illnesses can now be treated or even cured.  Your odds of living well longer have improved.  Greater longenvity for those in their 100s also means greater longevity for you and for me.

Medicine is doing what it can, as fast as it can, to help you recover from, manage, or cure many diseases.   You can increase the effectiveness of medicine by partnering with a good doctor and doing what you can to stay as healthy as you can be.

You can learn about the role of your health during retirement in chapter 5, “The Physical Domain”, in Beyond Work: How Accomplished People Retire Successfully.  Specific information about 8 remarkable trends in health care that will be in place in 10 years or less can be found on pages 120-124 of chapter 5.

You can order a copy of Beyond Work: How Accomplished People Retire Successfully from Amazon by clicking here.

At what age to you think that you be old?  Why?

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