What to Consider Before Retiring: 3 Cons of Traditional Retirement

Presented By: Pennsylvania Capital Management

Many people wonder, “When is the right time to retire?” This is one factor in a long list of what to consider before retiring. But if you ask me, the best time to retire in my book is never. Retirement is an antiquated idea the Baby Boomers grew up with. This generation believed–and many still do–that if you work hard your whole life, once you turn 65, you can say, “Ah, now I can relax.” In my opinion, It would be silly if you did that.

We’ve learned that, as you age, you deteriorate; your mind slows down, and all you’re doing is giving the Grim Reaper an upper hand to take you sooner. If you don’t find reasons to keep your body working, it won’t continue functioning as well as you might like–and there are plenty of ways to spend your Golden Years. 

Let’s take another look at what to consider before retiring through a logical lens. 

The idea of retiring at 65 changed dramatically due to medical advances. There are so many different drugs today that you hear about, like Wegovy, Ozempic, and others that help people deal with diabetes or excess weight, which is, unfortunately, an epidemic in America. Therefore, some of these medications curb your appetite. For people who smoke, certain medications can decrease their desire to smoke. 

My point is that these medical advances will lead to longer lifespans. 

We should focus on a higher quality of life, not just living longer. Just like there are available medications to treat illnesses, there are numerous strategies one can use to aid longevity and continue with a more vital life.

As you look at what retirement looked like 30 or 40 years ago–when people barely lived to 65– think about how we now can live so much longer. We’re finding that in the world of finance (the world we operate in at Pennsylvania Capital Management) we’ll get reports that a client passed on at 92 or 88, not in their late 70s, which was the case a couple of decades ago. 

It’s exciting to see these medical advances taking place, and people becoming more aware and conscientious about choosing better food groups and eating more appropriately. I think it’s a very, very exciting time. However, if you’re planning for your retirement, you better plan long and hard because you need to make that money last.

The Cons of Traditional Retirement

While traditional retirement does appeal to many people–and they have their reasons–there are some significant cons. When people brainstorm what to consider before retiring, they don’t always factor in any downside. After all, people spend their whole lives looking forward to retiring. 

Unfortunately, if you approach retirement with the idea of being “done” at 65, what ends up happening is a lot more sitting time. This could look like watching television, hanging out on the golf course, or taking a trip periodically–but the body slows down. You give up challenges you experienced during your working years, such as dealing with a boss, working with your compatriots, navigating the disappointments of deals that fell through, or working with a difficult coworker.

These things challenge the brain and encourage you to be creative and adapt. Most of that disappears in retirement. You no longer have the same level of social interaction, and you don’t have the companionship you gain from working with your peers and other team members. As a result, the challenges you once coped with with are over. The body decays; the more the body sits around, the more the mind begins to slow. This leads to the Grim Reaper coming your way sooner than you hoped–or sooner than is typically the case. 

Since we have these advancements, our new goal should be to live longer—and not just longer. We should strive to live higher quality, more fulfilling lives, which involves making important choices. 

If you give up the companionship of working at your office or independently with your clients, you give up the excitement of successes and coping with the failures that came along the way. Alternative techniques allow you to enjoy the next chapter of your life instead of hanging out on the golf course or sitting at home in front of the TV. Do these things in moderation, but don’t make them your everyday routine.

I want your Golden Years to be exciting and fulfilling. All the components of your retired life are pages in a beautiful new chapter–and you should be thrilled to keep writing it. 

1. Financial Consequences

The first thing you should consider before retiring is your financial situation. The fiscal consequences you face when you retire are significant. Here’s what ends up happening to many retirees I have either met or interviewed: They’ll call up six months ahead of time and say, “I’m almost ready. I’m thinking about retiring soon.”

However, they don’t realize they’ve had the benefit of their professional income–whatever that may be–and they forget that they’ve got to continue to pay Uncle Sam. They pay their expenses, such as their home expenses, but with the cost of living going up, they may discover, “Hey, all the trips I want to take when I retire add up to a lot of money. How am I going to pay those bills?” 

The number one fear most people share with me is the fear of running out of money. Whether they have $100,000, $1 million, or $20 million in the bank, it’s still ingrained in people’s minds that they need to be careful–or they’re going to run out of money.

My view is that, if you plan, you already have a good sense of what retirement will cost. Meet with your favorite fiduciary financial advisor and lay out your plan based on your family’s goals. It’s not that complicated. Find the team you trust, lay out your dreams, talk about it, and see whether your goals are realistic. 

We often encourage clients to work beyond the “retirement age” and keep their social network going. Get excited. Don’t work 40 to 60 hours a week anymore. Instead, maybe you’re only working three days a week–so now you have four to play. Do other things. Take the time you want to spend with the people you love, whether it’s your kids, extended family, or friends. 

Your free time might also involve visiting Ireland to check out your roots and see where your family came from. Maybe your goals involve climbing Mount Everest or some other spot you’ve wanted to conquer for years. Yes, retirement is a great time to follow your dreams–but it’s not the time to let your body deteriorate and your mind wither. You have to develop a balance.

2. Health Consequences

One area to consider before retiring is your physical health. As previously mentioned, slowing down physically when you retire is not always the best move for your overall health. Your physical health can decline when you lead a more sedentary lifestyle; exercise is important at every age. Likewise, as we age, we lose muscle. Maintaining a healthy, structured diet and exercise regimen under a doctor’s watchful eye is a great way to add years to your lifespan–not subtract them by languishing on the couch. 

Even if you’re not a fan of going to the gym, there are plenty of ways to stay active. If you’re someone who has health conditions or needs to be a little gentler due to underlying conditions that impact joints, bones, or other parts of your body, walking is a great place to start. 

Regardless of how you approach the upkeep of your physical and mental health, light to moderate activity and fresh air is going to help put you in a position where you are physically capable of enjoying the aspects of your life–like travel or playing with the grandkids–that you still want to accomplish. 

3. Relational Consequences

When you think about what to consider when retiring, take time to factor in your relationships. Relationships are what keep you young, vital, and creative. After you retire, the relationships you have cultivated with people at your work will eventually disappear. This may take six months or it may take a year. In some cases, you may have one or two relationships that hang on. 

I talk about never retiring because I want the vitality of being in relationships with people I enjoy. Professionally, I have the pleasure of rotating around to work with different families each day; I solve how to handle life changes through the lens of money and finance in my book. 

What could be more fun than that? 

It’s fun to hear about the issues that come with their children or a mother-in-law or a neighbor where they need to step in and help and they don’t know how to handle the financial pieces. So I, alongside our team at Pennsylvania Capital, work cohesively to help our clients solve it, get the right financing if they need it, negotiate a big purchase, and perhaps connect with other professionals because that’s a key part of what we do. We have 55 different firms that we refer to that don’t do what we do, but they help successful families get what they want out of life.

No matter when you retire–or if you retire–it’s important to foster relationships as you age. Find ways to connect with younger people and learn from them. Teach and mentor others based on the skills you’ve accumulated in life; find a niche to bring you excitement and get out there to make new connections.

Final Thoughts

What to consider before retiring is, ultimately, up to you. However, the idyllic picture many people have in their heads about what retirement should look like or does look like might not be your best option if your goal is longevity. Retirement isn’t the time to let your body wither and your mind idle; you can live the life of your dreams in your 70s, 80s, and beyond. My clients don’t want to live, they want to thrive. After all, you’ve worked hard for your money. You’ve spent the majority of your life working, and you deserve to take time to focus on areas that have fallen by the wayside for more practical things. Your time is precious.

Think about all the hobbies you’ve wanted to pursue, but haven’t had the time. Consider the time you want to spend with your family, friends, and others in your social circles. Maybe you’ve wanted to spend more time volunteering or in your community. Regardless of what you want to do, time is one currency you can spend in retirement—and you should.

But don’t spend all of it on the couch. The cons of traditional retirement can have serious consequences, and I promise you, not retiring (at least, not in the conventional sense) is a better way.