Golf is not a retirement strategy, although talk to any about-to-retire man and you might think it is. After two to three weeks of playing golf, that feeling of being on vacation leaves as the stark reality called “life” sets in.
Established by Mark Lee CPA, MBA and Karen Benz, MS, “Certified Professional Behavioral Analyst”, Business Legacy Consulting is based in North Attleboro, Massachusetts specializing in strategic exit planning for businesses. The firm takes a close look at the negative ramifications of unrealistic retirement planning and how to prevent them.
“Men too often identify who they are with what they do – it’s how they value themselves,” said Benz. “So when they think about retirement, they think about the loss of being productive and doing meaningful work – or, it being equivalent to death. If they are not prepared for it, they are susceptible to stress and depression.”
According to research by Dave, Rashad, and Spasojevic (2006), retirement increases depression by 6 to 9 percent, illnesses by 5 to 6 percent, and difficulties associated with mobility and daily activities by 5 to 16 percent.
Several studies show that this is due to how retirees might view their retirement. What was once a fulfilling, meaningful life suddenly becomes a job loss and disconnecting from productive activity and social integration. It can mean withdrawing from society and sometimes socially isolating oneself from others.
“The impact of not being prepared psychologically for retirement following a productive and meaningful career can be devastating,” said Benz. “However, there is hope. By creating a plan for life after retirement, one can guard against depression and stress. This is called ‘mental readiness.’”
Benz explains that it starts with creating a vision for what life will be like after retirement. What do you see yourself doing? What types of activities have you always wanted to do but never had the time or money to do? Who are the people you wanted to spend more time with but couldn’t because you were always working? What are you passionate about? What are your talents? These are the types of questions to ponder in order to create your vision.
Creating a vision helps focus on what you are moving to rather than on what you are losing. Looking at fears is equally important. What are your fears about the future? What are your fears about retirement? What do you think you should do to better prepare yourself for retirement? The more you face your fears, the more you will reduce your anxiety when retirement comes.
Changes are the events which cause us to transition. Transition is a process, and it is stressful.
“If you have a spouse or partner, talk about the changes and what the transition process will mean to you as a couple,” said Benz. “It is important that communication be open and honest during this time. Be open about what your expectations are.”
“If the man is now going to be retired, does this change his role in the home? Are household duties shared differently now that he spends more time at home? You do not want to end up being the grand piano in the kitchen,” said Benz.
Leaving a business legacy is an important consideration. Many men have contributed a great deal to the business world and can teach those coming up through the ranks. There are boards, teaching opportunities, volunteer assignments, and more that can position retirees to continue meaningful work beyond retirement. Nearly half of all retirees (48%) volunteer in an organizational setting at some point during their retirement, (Cornell Report on Retirement and Well-Being, 2000) and approximately two in five (42%) retirees not currently volunteering estimate a better than one in two chance that they will volunteer at some point in the future.
Financially, the transition can be just as difficult. The reality of a regular paycheck is gone. Concerns about having enough money to live the life you want to live are front and center. This predicament screams for comprehensive planning.
“The term is ‘financial readiness,’” said Lee. “Are you financially ready to live the life you want? A transition from career to retirement will be much smoother if you know the answer to this question before you start the transition.”
There is a process to follow to determine where someone stands on this question. It involves a determination of how much you expect to spend annually while in retirement, identification of sources and amounts of income post retirement, and completion of an inventory of assets available to fund retirement,” said Lee.
Lee continues, “If income plus a reasonable liquidation of assets on an annual basis is sufficient to cover anticipated spending, you are free to start to enjoy your retirement. If not, you need to generate more income or cut your spending. You need to know this as soon as possible. No one wants to outlive their money.”
The situation for men who used to own their own businesses can be even more difficult. It is not unusual to find that the business paid for expenses that now need to be paid for directly. Health insurance, entertainment, and automobiles would be examples of benefits that now have to be funded by the retiree. Some former business owners will be surprised by the amount of expenses that their business used to cover for them.
“The key is in planning for retirement – financially and mentally,” said Benz. “Working with professional advisors to plan for your transition is the key to a healthy and happy retirement.”
About Business Legacy Consultanting (www.businesslegacyconsulting.com)
Mark D. Lee, CPA, MBA has a passion for helping business owners succeed in business and life. He provides a full range of consulting and financial services to his clients, with an emphasis on financial and operational strategies that maximize profits and cash flow, while minimizing taxes. Lee has extensive experience in business planning, evaluation of business systems and general management services for manufacturers, high technology, restaurants, real estate, consulting, and contractors.
Karen Benz, MS, “Certified Professional Behavioral Analyst,” specializes in business consulting, strategy and leadership development with an emphasis on improving individual and organizational performance. She has owned a consulting practice since 1996 working with clients in many industries including manufacturing, finance, hospitality, health care, and non-profits.
For more information, email firstname.lastname@example.org or call 508-639-9879.