When I work with clients on retirement planning I have a lot of questions about numbers.
How much have you saved so far?
How much more will you save?
How much do you spend now, how might that change in retirement?
How much will your social security benefit be?
How much will your health insurance cost?
On and on and on, numbers galore!
But what about the non-numerical questions? They are also important.
How will you fill your time for the first 6-12 months after you retire? How about after that?
How will you keep your mind sharp?
What’s going to get you out of bed in the morning? (Besides the cat)
For some people, the answer to these questions is a job, even though the numbers say it’s not absolutely necessary!
For many the goal is to save, invest, repeat until they retire and don’t have to work anymore.
Not having to work is great. But so is working because you want to!
Recently four of my retired clients (all women) have been lured back to the work force in some capacity.
One of them came into my office looking happier than I’ve ever seen her, sat down and said: “Guess what — I got a job!” with a huge grin on her face. For her, and many single women like her, her job was a huge part of her identity. She missed it. Working again part time helps fill her time and gives her purpose.
None of these clients need to work “according to the numbers”.
However, one of my many mantras is “Earned income in retirement is a beautiful thing.”
Why? Because anything that reduces portfolio withdrawals improves portfolio longevity. Said in normal English – if you take less out of your nest egg today it will last longer.
Working because you want to, not because you have to is called Financial Independence – and this really is a beautiful thing.
