Marathon runners do not train and plan for the sole experience of standing on the finish line. The process, the training and the overall journey from beginning to end are all part of it. Knowing that hard work and effort paid off and a goal was accomplished, that is a remarkable feeling. Treating your retirement goals like a marathon, you work hard, you keep going and when you reach the finish line, all that time and labor pays off—you have the money you need to live the life you want. That’s a wonderful feeling.
Let’s do an exercise.
Close your eyes and try to picture your own funeral. Who is there? Who gets up to speak? Are you proud of your achievements and the life you led?
The time you’ve been working, planning, and saving for has finally arrived! You’re retired. You can travel, you can spend time with your spouse, you can attack that bucket list. After a short time though, you may find the excitement of this new chapter ebb and the reality of how much actual time you have in a day. If like a lot of us, you’d spent most of your adult life working and/or chasing kids, the lack of a schedule may prove a little more challenging than expected.
This is why it's so important to stay active in your retirement. Active, in this case, is not just exercise, though that is definitely a major factor, but also active socially and in your community. Social connections, friendships and having reasons to get out the door, outside, and into the world keep us healthy and happier into retirement.
What Do You Do?
The question that used to be answered so easily now gives you pause. You spent a lifetime working, defining yourself in part by your occupation. But now that you’ve retired, that most basic question has become a minefield. Finding a simple answer for who you are now is not so easy. Who are you if you aren’t working? If you are no longer the doctor, or lawyer, or professional? When you can’t reduce your identity down to a single occupation as an explanation. What new word can you use to encapsulate who you are and what you do? When “I’m retired” doesn’t roll comfortably off the tongue, then it’s important to examine why. You’re retired now and it’s up to you to define what that means.
The stock market can be volatile. This we all know. If you were investing in 2008, then you know precisely how upsetting it can be when the volatility means big losses. So, imagine a day when one of your equities drops by 40 percent in mere minutes. On August 24, 2015, this happened. Exchange-traded funds (ETFs) declined about that much only minutes after the opening bell rang.
What would your reaction be if you had owned one of those ETFs? Would you:
- Sell it at the loss and move it into a money market or bond?
- Take the opportunity to buy given the low stock price?
- Do nothing?
This is not a cautionary tale but rather an exercise in fastidiousness or, at the very least, awareness of who you are as an investor and what that means for your portfolio strategy.
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