In Your 50s? Prepare Psychologically to Retire

HUNT VALLEY, Md. ( TheStreet) -- Many people who work in the same career for decades invest their identity in it. That makes it difficult to retire because, in their minds, losing the job makes them nothing.

And that's why when preparing for retirement it is important that you do so not only financially, but psychologically. Retirement sounds like a great reward after many years of work, but it is one of the most stressful times in a person's life (a list that includes graduating from college, getting married, having a first child and the first marriage of a child). This is logical, as we are all creatures of habit. Retiring after working for 30-plus years can be very scary.

When preparing for retirement it is important that you do so not only financially, but psychologically.

Prudent planning is the main way to prepare yourself psychologically for the transition.

It is imperative to create a retirement plan that helps maintain an active lifestyle in which you make a contribution to your family, community or even humankind. A Health and Retirement Study from The University of Michigan has found that those who continue to work in retirement stay healthier, happier and more mentally agile. A plan to begin anew in your retired years will help overcome an identity tied up in your current career.

Even more important is the need to prepare for the inevitability of death. There is a great new country song out called Live Like You Were Dying by Tim McGraw that should be the theme song for all retirees.

Far more joyous and fulfilling is a retirement when one lives with an understanding that there is no guarantee of tomorrow. Too often we look to our money as the bedrock to protect from the last day of our life, but no sum of money has the ability to prevent our day of death.

The real power of life is in relationships, but so often we have attributed our power to our money and destroyed them. The best way to overcome death is by spending each day of our life enriching relationships. No, it will not stop the inevitable, but relationships will allow you to depart this earth satisfied and content, because the greatest legacy we can leave is not money or assets, but rather the hopes, dreams, passions and aspirations we inspire in the next generation to the benefit of all mankind.

If your funeral were held tomorrow, who would come and what would they say? This question is the foundation of a truly great retirement plan.

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Andrew Tignanelli, CFP, CPA, is president of Financial Consulate, based in Hunt Valley, Md., and a member of NAPFA, the National Association of Personal Financial Advisors.

This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.