Part 4: The Art and Science of Retirement Planning

Doug Nelson, author of Master Your Retirement, concludes his Art and Science of Retirement Planning series with a look at some ideas on how to navigate the five stages of retirement.

The art of living out a compelling retirement is similar to the process of assembling a puzzle: often you would work on one section of the puzzle at a time. Everyone will evolve through 5 stages of retirement; some may last only for a few days or they may last for many, many years:

1. The Pre-retirement Years
2. The First Two Years of Retirement
3. The Healthy Years
4. The Illness Years
5. The Alone Years 

As you live out the “art” of your retirement years, think in terms of which of the 5 stages you are in today and what the next stage is likely to bring.  With this in mind, think about the next 3 to 5 years and how you can gain as much living from these years as you can.

In Master Your Retirement, two ideas are shared that will help with this process: 

The jar of possibilities: This is a self-imposed game that challenges you to try or learn something new or to go outside of your comfort zone.  In the research for the 2014 edition of Master Your Retirement, we found that the number of people who continue to work past age 65—primarily for personal challenge and enjoyment—has continued to grow.  This is the process of building a beautiful montage of images, memories and experiences that make up your retirement years.

The lifeline process: This involves creating a clear picture of what your ideal life would look like for each 3 to 5 year increment.  Break down your week and year into areas such as health, exercise, travel, family, work, and volunteer/community involvement and activities.  When you break down a large problem or project into smaller pieces, as is done with the lifeline process, the goals tend to be just that much more attainable over a shorter period of time.

The Art and Science: As discussed in this four-part series, mastering your retirement is both an “art” and a “science”.  By spending time reflecting on each area, you will find that you build a beautiful montage of your life—assembled one piece at a time—while enjoying a safe, secure, tax-efficient income with a low cost and low risk portfolio.

LAST TIME: Part 3: The Art & Science of Retirement Planning

Pick up your copy of Master Your Retirement from the Knowledge Bureau Bookstore.

Doug is a 21-year veteran of the financial services industry in Canada and is a senior financial planner and licensed portfolio manager. He has authored several advanced financial planning courses with Knowledge Bureau.