Friday, 24 May 2019

REINVENTING RETIREMENT: The dirty ‘P’ word of retirement planning – The Mercury

Profits, premiums and prospectuses. They all start with “P,” but none of these words is dirty to me. Can you guess my word for today? Let’s get right to it without delay. It’s…procrastination.

Everyone can likely think of something in life they procrastinate. The problem with this dirty word is that sometimes just the thought of admitting our avoidance makes us cling to it even more. If you’re a procrastinator, you know exactly what I’m talking about, right?

If you watch or read the news at all, you know that an alarming number of Baby Boomers have procrastinated retirement planning for too long. As a result, millions are behind in their retirement savings. This is a serious matter. With the discontinuation of company pensions and social security funds eventually at risk, every generation must begin putting away for their future. And the time is now.

If you’re reading this column and feeling behind in your retirement planning, I’d like to remind you that planning for your retirement is not just about dollars and cents. If you’re ready to stop procrastinating, I’d like to help you identify four areas of procrastination that people sometimes struggle with and the potential long term results.

By recognizing these areas, you could keep them from stealing another day from your retirement future.

Poor organization

Over the last twenty years, I’ve seen so many families who struggle with poor financial organization. This includes unfiled records and sometimes even no records at all. People have confessed over and over again to having old retirement accounts, life insurance policies and even pensions that they know little to nothing about.

Ten plus years ago I’d say people failed to change mailing addresses and allowed procrastination to get in the way of getting organized. Today, however, companies are going paperless. And while electronic records can be a great way to get organized, they can also be a huge deterrent since online accounts require sometimes forgotten or misplaced usernames and passwords.

The truth of the matter is that long term, poorly organized records might be stealing from your retirement future. There are plenty of programs out there to keep track of your financial life — start today.

No estate plan

If you’ve been reading any of my other columns you know by now that your plan for retirement is not just about money. Regardless of how much or how little you may have put away, having a well written, updated estate plan costs very little, but can have priceless importance.

That said, in my experience it’s often something people delay doing. As a result, I’ve seen clients die without wills, with outdated beneficiaries, and sadly with healthcare wishes that were not honored because a proper healthcare proxy or power of attorney was not in place.

While I sympathize with the challenge of facing difficult decisions that a proper estate plan requires, I encourage you to find the strength. Perhaps you confide in a friend who can encourage you to complete this task — maybe this person needs your support as well.

No long term plan

The blessing of modern medicine is that people are living longer than ever before. With this benefit however, comes the reality that no one can afford to procrastinate their long term care plan. This does not necessarily mean a nursing home or assisted living facility.

Only you can fill in the blank for your long term care future. Whatever you decide, you need to have a plan. Maybe you significantly downsize or move in with a child or another family member once you reach a certain age. Here is the key though — your plan needs to include triggering events or ages where you decide to put it into action.

Too often people wait to make any changes to their lifestyle because they’re healthy — they see no need to get started. But this is exactly when you need to act. Implementing your plan while you’re still healthy enough to make decisions yourself should be your most important goal.

Otherwise, if you wait too long you might reach a point where you’re no longer the one making the decision (i.e. if your health or mental state declines).

Lack of communication

Sometimes the only thing that is harder than acting on the things above is talking about them with the ones you love. Have conversations with your family (or maybe friends) about your plan. Involving those who are the closest to you is the most important way to help ensure that your wishes are carried out.

Then, once you talk about it, make sure it is written down and that your family members have a copy. Also, be sure to leave detailed instructions about where all your important documents are located. Taking the time to do these things will speak volumes, even after you no longer can.

Plato said, “Never discourage anyone who continues to make progress…no matter how slow.”

Remember — even modest steps forward are a step in the right direction. Whether you started retirement planning decades ago or you’re just doing so now, today is a great day to keep moving forward.


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