By Danielle Howard
Picture the 100- or 110-meter hurdle race. That's the one where you have to jump 10 hurdles to reach the finish line. You have retirement financial goals: pay off your mortgage, build your 401(k), generate a tax-efficient income stream, and create a legacy.
While it is important to have goals, what I have experienced in my 23-plus years in the personal finance industry, is that there are three foundational hurdles to overcome along the way.
The Hurdle of Discontent
"We will never retire."
"I don't have enough."
"The tax laws changed."
"The market hasn't performed as projected."
Ever caught yourself uttering these words?
As you push through the discontentment around your retirement finances, see how money's purpose in your life is evolving. Consider these three power moves to get you over the discontentment hurdle.
- Some people will always have more than you, and others will have less. Take a moment each day in humble gratitude to recognize what you do have. This will keep FOMO (fear of missing out) at bay. Do the best you can, using your resources wisely.
- Set preferences and priorities. Stop comparing yourself to others or what the financial services industry says your retirement should look like. What do you want your day to look like and what financial choices do you need to make to bring it to fruition? How will your financial resources fit together to provide the framework for supporting what is truly meaningful in life to you.
- You shift from the focus on earning a living to having your resources work for you. Your awareness shifts to sustaining a cash flow from different means as you move into the distribution phase. Know what financial tools you have and how to use them effectively to maximize money's new position in your vesper years.
The Hurdle of Financial Discomfort
We have received mixed messages about money throughout our lives. As you move into the fall season of your life, those beliefs may have become firmly anchored. Those messages have created mindsets and behaviors that are either serving you -- or not.
Misinformation and misunderstandings around money can make communication and practical application static or tense. Take for example, the line from the New Testament, 1 Timothy 6:10 -- "The love of money is the root of all evil."
I have heard people misquote this as "money is the root of all evil." Think of the divergence in the behaviors that would come out of either of these mindsets.
It is not easy to talk about money. It may be the messages going around in your own head, or the conversations you have with a spouse, friend or family member. Here are two ideas to conquer this obstacle:
- Be vulnerable. Start with a conversation about a money memory you have with someone you feel safe with. It is easy to stay on the surface and discuss the market returns or the most recent purchase you have made. It is more rewarding if we press through the discomfort we have around doing our dollars differently.
- Be honest. Get honest with yourself and others. Live in your financial integrity. Explore what type of financial personality you have and what opportunities or challenges have you encountered over your life. What worked for you in the previous seasons of life and how can you build on that. What hasn't worked and what do you want to address and make intentional changes?
The Hurdle of Financial Distrust
You need to protect yourself from predatory sales people, scammers and unfortunately, sometimes those closest to you. With what has been learned about behavioral finance, you also need to protect yourself from yourself. You don't want to do this money thing on your own, but who do you trust?
- Put your team together. Establish your trusted network of advisers who uphold and adhere to a code of conduct in your best interest. This network would include but not limited to a financial adviser, estate attorney, CPA, bookkeeper, health provider, elder care advocate and family members. It is up to you to discern who fits your needs and let your intentions and wishes be known.
- Stay engaged. Bring family members or friends into your financial discussions sooner than later. Establish periodic meeting times to ensure your best interests, needs and desires are understood and upheld.
Your financial life in retirement is not a race, there are no medals for crossing the finish line. You can however, live a life of no regrets by overcoming these hurdles and making sure the financial resources you have are working to best support you and those you care about.
About the author: Danielle Howard is a Certified Financial Planner and author of Your Financial Revolution - Time to Recognize, Revitalize, and Release Your Financial Power, a speaker and financial thought leader. Visit her at www.wealthbydesign4u.com, or www.daniellehoward4u.com. If you are within five years of retirement we invite you to download your copy of Monetary Manifesto. Advisory Services offered through Cambridge Investment Research Advisors, Inc., a registered investment adviser. Securities offered through Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Cambridge and WBD are not affiliated.