GA, Feb. 2018
A lot has been written about retirement and there are many recommendations and guidelines available about this very important step. Here are just few a few statements to ponder:
“You can't afford to decide not to decide.”
“Retirement is not to retire.”
“Remember that there is life after retirement.”
“Retire from work but do not retire from life.”
“Do you hate or love the word retired?”
When is enough, enough? While life is full of decisions, choosing to retire is perhaps one of the most important decisions we must make as we near the end of our working lives. Sooner or later, it will be time to decide – but how to decide? And how to make a successful transition?
To have a choice to decide is a privilege. Unfortunately, it is also a privilege that is often taken away from some of our most senior colleagues who, upon reaching a “perceived” age, are faced with layoffs, retrenchments, management decisions and/or forced retirements due to a variety of reasons including the sale/takeover of a hotel or company, M&As and others. This is very unfair but unfortunately it is the reality and a fact of life. And in most cases a “golden handshake” is not sufficient in the long term.
But do not despair. The industry is in need of good people with solid experience to guide the less committed and inexperienced younger workforce and the new executives – especially as experienced talent is becoming increasingly difficult to find.
For well-known and experienced senior professionals to continue working on a full time or part time basis well into their 70s is now nothing new (70 is the new 65). But even with a new job – or jobs – in your senior years, a decision of when to say farewell to it all has to be taken.
When this time approaches, it is important to remember to ask yourself the right questions rather than focusing on outdated ones from the past. Start developing a positive attitude towards retirement and try to determine the type of retirement you want.
Trying to estimate our life expectancy can lead to trouble; we are living longer and that’s a mixed blessing. Most people seem to base their plan for retirement on their birthdays, and on their parents’ longevity, and leave themselves unprepared for their own longer lifespans.
Statistics show that life expectancy in the West has been rising by nearly three months every year, year after year. According to the Centers for Disease Control and Prevention (CDC), the average 65-year-old can expect to live another 20+ years. Keep yourself in good health, and you could easily live well into your nineties and beyond. (Of course, we have to ask ourselves what will happen if we all reach 100?).
The proliferation of biotech and bioscience research towards extending lifespans – especially in response to dropping fertility rates in the West (Europe in particular) and some parts of Asia – is accelerating the trend towards longevity.
Coming-up with a retirement date is an emotional, complex and personal decision that’s not always easy to make as there’s not really a one-age-fits-all solution. Give this decision the time and attention it deserves. Why do you want to retire? What will you do all day? Are you ready for it?
Do your homework and develop a pros and cons list. Trust your gut, consult with people important to you, make yourself at ease, and align the decision to your personal values. We are all different individuals and have different likes, dislikes, objectives and needs, but we all have to share our plans for the future and take retirement as a chance to pursue new skills or passions.
There are also few senior professionals (the minority) that can easily walk out of the door and never look back because they don't agree with the company's direction or philosophy, nor with their superiors, and who will leave their job with no regrets at all. Of course, once you reach a senior age, one has to be conscientious of the consequences – and difficulties – of finding a similar position elsewhere.
On the practical side, one of the most critical factors to ponder when making your decision is the financial aspect.
Most of us started our working life barely able to pay our basic bills. While some of us were advised to start planning for old age from the start, only a few of us really took heed of this advice. The majority of us were far too busy focusing on our careers – transferring to new cities in foreign countries and working our hardest to perform above the market – to pay attention to any plans for retirement.
In dealing with the demands of the industry, saving for old age was low on the list of most people’s priorities. This is a big mistake, of course, and I hope that young people today will learn from it.
It is not advisable to rely on government social pensions because these will just get skinnier and skinnier over time – and in some cases may even disappear. The same applies to corporate pension schemes; we must accept that these also come with risks. And don’t forget that the government may even come after you to impose taxes on your savings. You need to be smart in this important matter.
What savings and investments should you have to retire comfortably? Of course, it all depends on the quality of your lifestyle, on your debts (if any), and on the cost of living wherever you choose to retire. No one has a crystal ball, but you must recognize that once you’re out of your job, all the ancillary perks and supporting services will disappear. No one can tell you how large your bank account should be, how much you can spend per month, or whether or not you will run out of money.
One old “rule of thumb” states that, for a comfortable retirement for a person/family, the average retirement savings (including marketable assets) should be around 25 times larger than the expected annual withdrawal (with no debts to repay).
Note that this is only a gross estimate. How many around-the-world cruises will you take per year? How many social clubs do you belong to? How large/expensive is your house/s? And that dreamy sports car?
You definitely don't want to lose your self-esteem, sense of purpose and ultimately slump into depression. The extent to which will you chip-away each year at everything you have built-up to fund your lifestyle is your call.
Saying that, it’s very important not to forget potential health issues and the related medical costs. Take a very good and honest look at your health and life expectancy. Maintaining good health through lifestyle and other practices is clearly a must. Death is inevitable, but it doesn't need to be preceded by years of suffering, frailty and high medical bills. You must take these potential costs into consideration.
Most hotel professionals who are finding themselves without medical coverage after retirement must realize that personal medical insurance is very expensive from the age of 65 onwards. We are all aware that people are living longer, but unfortunately that doesn't always mean those extra years are healthy ones. Good health is simply a top priority.
Retirement today is more “about you” than your money and you must be ready for the new phase in life. Socializing, community/charity work, sport activities, self-learning – all of these help to maintain mobility and keep the brain active. Meditation and spirituality are also proven to be of great help, so is spending quality time with friends and family.
In this industry, we have been working in a high-stress and demanding environment for most of our lives, and to make a successful transition into retirement we must remain active as much possible. Loneliness and isolation may not be the best way.
Even in retirement we have to find true satisfaction and purpose. Learn, unlearn and relearn. Embrace the change, adjust and evolve to the new life. Try to do more of what you like as opposed to what looks good to someone else. There are no failures in retirement.
For married retirees, maintaining a positive relationship with your spouse is equally as important as the size of your bank account. Hanging around the house all day doing nothing isn’t always the best recipe for harmony. You both need space, and you both need to find activities you can enjoy together. Both of you should be on the same page and enter retirement as a team.
Are you ready for this new phase of life? And can you prove that you are ready?
As you retire, do not feel that you are leaving something behind. Instead, view the next step as something new and exciting. Write down a bucket list and tackle it with gusto. Now is the time to enjoy the fruits of your hard work. Do all you can to maintain your health and spend some of your money on having fun – the more fun, the better.