Transitions in Retirement: A Whirlwind of Change

Spousal Relationship Transitions

Early Retirement   

Every significant change in your life has the possibility to impact your marriage, including retirement. Often starting during the years leading up to retirement with empty nesting, couples must deal with changing dynamics in their relationship.

With simultaneous retirement, there is a sudden and enormous change in time spent together. This can be a good thing, or a not so good thing.

Some couples set a shared vision of their retirement together and enjoy an exciting renewal in their relationship. However, some couples have differing wishes for retirement and can grow apart. Often living separate lives in the same household.

If one spouse retires before the other, new stresses and resentment can be injected into the relationship due to expectations about household responsibilities as well as expectation about spending time togeth. These issues must be dealt with in a manner that addresses the feelings and needs of each spouse.

Changes in sexual drive or physical capacity can also inject stress into a relationship. Sometimes couples decide that the changes and stress caused by empty nesting and retirement are enough to end their relationship. Notwithstanding   the fall in overall divorce rates in the U.S., gray divorce (divorce by people age 50+) has been on the rise. While the number of marriages that end in divorce declines with age, the rate of divorce among people age 50+ has doubled since 1990.

Of course, with the gift of time that retirement brings, some hard-charging busy single, divorced or widowed professionals actually find time to dedicate to relationships, something they may have felt like they couldn’t adequately pursue while working. Depending on their priorities, needs and circumstances, individuals may decide to seek uncomplicated companionship, a committed relationship or marriage.

Spousal Caregiving

Another major transition in a spousal relationship occurs when one spouse becomes the primary caregiver to the other. Dependency and decision-making roles may shift and result in relationship dynamics never experienced in their relationship.

Caregiving is an act of love and brings with it a particular form of fulfillment. However, this transition can be especially challenging if the spouse requiring care is resentful or in denial of the need for increased care or the changing roles.

Widowhood

Any marriage that does not end in divorce will end with the death of a spouse.

Therefore, becoming a widow should be an expected part of retirement for married couples. However, far too often, widowhood comes as a surprise. Even with good planning, widowhood can be disorienting and stressful. Without planning, it can be overwhelming.

The surviving spouse instantly becomes totally and completely responsible for all the tasks that were shared in marriage. This may include some items that they have not been involved with for decades, including, often, financial planning. This creates unnecessary anxiety, even panic in the transition to widowhood.

Financial Impacts of Spousal Relationship Transitions

A change in marital status later in life is one of the most significant financial shocks that a person can experience and is generally unanticipated.

For divorce, individual wealth is effectively cut in half while total expenses do not fall anywhere near that amount.

Caregiving can introduce a number of new costs including costs associated with medical treatments, prescription drugs and new equipment to aid in caregiving.

With widowhood, there is frequently a loss or a decrease in one or more sources of income, including pensions or Social Security benefits.

Late in life marriage can be financially complicated. One or both partners may bring significant assets and property to the marriage. Setting up a pre-nuptial agreement will ensure the couple has a comprehensive discussion regarding existing assets, debts, and expectations regarding protection of any inheritance for adult children..

In any event, the need to adjust and create a revised retirement plan that accurately reflects new life circumstances is critical after any spousal relationship transition.

Residence Transitions

Early Retirement

When we are working and have school-aged children, we choose to live in a location that has good schools and a tolerable commute to work. When we retire, neither of these are as relevant in determining where to live.

Many people decide to downsize, often moving to a more favorable climate or to a location with a lower cost of living. While this new beginning brings many obvious benefits, it also introduces some stresses and hidden costs. For example, when downsizing, most retirees will likely need to “declutter” and give away or sell some of their possessions. This can be liberating for some and very difficult for others.

There is stress and costs associated with the move itself. And then there is the integration into a new community, finding new places to eat, shop, get your hair done and get your vehicle serviced. Old routines are traded for new ones, sometimes for the better, other times not.  Importantly, one needs to cultivate a new network of friends. Old friends can visit, but new, local friends will make the day-to-day more satisfying in your new home.

Some retirees decide to stay in their pre-retirement residence. Some stay because of their strong ties to the community while others cannot fathom leaving the memories they have created in their home. Many who choose to remain in their existing residence will decide to update, upgrade or remodel their home, either based on their preferences or to improve the home’s accessibility as they age. This too can be a mix of exciting and stressful.

Finally, some view retirement as a time to add to their real estate portfolio. Having a separate, seasonal residence for summer and winter, for example. Or having a primary residence and a vacation home in the mountains, forest or by the lake. This can make accessing desired activities much easier but brings with it some measure of increased expense and complications.

Later in Retirement

Early in your retirement you may be focused on access to desired activities. Later in retirement access to skilled medical care and minimizing home maintenance responsibilities may become paramount.

It’s important to recognize this phase in life and make plans accordingly. As you age, you may consider moving to a continuing care retirement community, or moving into an apartment close to an adult child that will play a role in caregiving. Ideally, this should be undertaken early enough to make the transition as manageable and agreeable as possible.

Financial Impacts of Residence Transitions

For many people entering retirement, their home is one of their largest single assets. How individuals utilize this asset in retirement can have a significant impact on their retirement finances. For example, selling a large family home in an expensive Northeastern suburb and moving to a nice but smaller residence with lower real estate taxes will impact ongoing retirement expenses as well as free up capital to be spent or invested.

Making plans for residence transitions during retirement can help individuals make sound decisions. In addition, it helps mitigate the chance of making these changes under duress which can result in suboptimal outcomes from both a personal and financial perspective.

Transitions with Family and Friends

Retirement can bring with it significant changes in your relationships with extended family and friends. Your abundance of discretionary time in retirement allows you to spend more time with the people who are important in your life.

One of the great joys of getting older is the possibility of becoming a grandparent. Observing the joy and growth of a child without the challenges that come with day-to-day child-rearing responsibility is described by many as one of the best aspects of retirement.

Unfortunately, with increasing age comes a greater possibility of losing siblings and friends. One of the great risks of retirement is isolation. This, in part, is why it is important to always be investing in forming and growing new relationships.

Financial Impacts of Transitions with Family

An increasing number of retirees prefer to give some of their money away while living to see the benefits of their financial gifts as opposed to leaving it upon their passing. For example, providing financial support for a grandchild’s education or first vehicle. While the benefits are obvious and can be gratifying. It’s important to balance prudent giving with your own, possibly unanticipated financial needs.

Financial Impacts of Transitions with Friends

Shared routines and activities with friends that may have been established during your years working may continue into retirement. This can be great if it involves a friendly game of cards but can become difficult if it involves expensive travel or other pricey activities and financial situations diverge in retirement.

Health & Wellness Transitions

Recognizing the importance of maintaining good health for as long as possible, many retirees use some of their discretionary time in retirement to renew a focus on their health and well-being. This may involve, for example, changes to their diet and exercise routines.

With more time to shop and prepare meals, eating foods that can provide proper nutrition and help maintain a healthy weight becomes more achievable. Focusing on functional strength, flexibility and balance during exercise becomes an increasingly important objective. In the pursuit of psychological wellness, some find a renewed interest in spirituality and  work to leave a meaningful legacy of their life.

While there is much written about the role of caregiving to another adult, and deservedly so, there is precious little written about how to be a good care recipient. Accepting the change in your health, expressing appreciation to your caregiver and being a “good patient” by following agreed to routines are all important elements of being a good care recipient. At older ages, this transition tends toward becoming a major, even exclusive focus of the life of the caregiver and care recipient.

Financial Impacts of Health and Well-being Transitions

Care expenses are not strictly additive to overall spending since for all but the most frugal retirees, there will likely be other expenses that offset some of the costs involved with caregiving.

Retirement is not a dull, unvarying chapter in life. During our retirement years, individuals and couples are likely to experience many significant transitions. Personal satisfaction and financial security during retirement can be enhanced by a recognition of these common transitions. Discussing these transitions and taking some action in advance of when they occur can improve outcomes. Retirement planning is an on-going, iterative exercise. The need to update and adjust existing retirement plans is prudent after any major transition.