Why Didn’t Anybody Tell Me This Stuff Before I Retired

March 15, 2023 — It seems like a person shouldn’t be allowed to start retirement until they went through a course. There are so many important decisions – when to take Social Security, where to live, what to do all day, how to budget for the long haul, etc. To help with those as well as items that go well beyond those usually recognized issues, I’ve prepared a list of some of the top observations that I wish someone had shared with me long before my retirement began 16 years ago. Your suggestions are welcomed in the Comments section at the end.

11 Things I Wish I Knew Before I Retired.

Recognize that retirement has many phases. The best approach is to have a long range plan that will work for each period of retirement. That means considering what your first place to retire might be like if you lived there as an old person. Will the healthcare situation be right as your needs change? Are there assisted living or CCRC facilities in the area, so you don’t have to move far away and start over again with friends, doctors, church, etc. Is there public transportation when you can’t drive anymore?

Plan ahead If you are going to have a big payday when you retire. If you plan on moving to a low tax state anyway, consider making the move before you get it. Very few people are lucky enough to get delayed compensation or a buyout of some kind. But if you are one of those, a little advance planning could save you a lot of state income tax. For example, arranging for the funds to be paid out over several years rather than in a lump sum.

Have heart to heart planning sessions with spouse and family early on. This helps avoid big surprises. My wife and I kind of evolved into our retirement planning. We knew we wanted to be snowbirds somewhere, most likely in Florida. We explored some places before we retired, but didn’t come to a conclusion for a few years. Our adult kids were not established enough to have an impact on our decision, but at various times we did consider, and rule out, moving to be near them. The worst case scenario is to enter retirement never having talked about it, and discovering you and your spouse have opposite intentions. Fortunately for us, we were well aligned.

There are a lot more volunteer opportunities than you think. But you might need to look around to find the one that works for you. Often people say they want to volunteer, but they don’t know where. The place you retire can have an impact on the number and kind of opportunities, but the biggest hurdle is usually not taking an active enough role in searching for the one that matches your interests and abilities.

Be prepared to be your own computer geek. This one might seem a little silly, but if you have worked in an office that has an IT department, your first computer crisis as a retiree is going to be a shock. Be prepared – either get more knowledgeable or find out where you can get help. For example, Apple stores have classes that can teach you a lot and solve your device problems.

Take an active role in your condo board or HOA.  One caution about HOA’s is to beware of buying into a property where there are just a few owners – maybe a house split in into four condos. It can work out, but if you have one “bad” neighbor, a big building problem, or a deadbeat owner, things are going to get tough.  Regarding HOAs: Sure, you say you are too busy to run for the board or go  to the meetings. But if you don’t know what is going on, you could be very sorry if later on things go in a direction you don’t agree with. I am on our condo board, and find the experience worthwhile, particularly in knowing what is going on and having a role in deciding that.

Condos and big buildings need inspections – physical and financial.  Your big condo building or community center might look great, but what is really going on behind those walls? Florida has tough new inspection laws that aim to prevent disasters like the one that occurred in Surfside. Look for and examine reports, and be wary if there are none. Likewise, what kind of financial reserves exist (the FL law now requires dedicated reserves for a long list of items). Some condo boards pride themselves on never increasing their HOA fees, a false economy when a major expense requires a huge assessment.

Physical activity needs to come along with stretching and conditioning. Active sports like pickle ball, tennis, cycling, even walking are a great way to stay healthy for the long term. But if you over do it, or don’t stretch or warm up, you can end up injured and on the sidelines.  Yoga, pilates, massages, and other low impact activities can help keep you out of physical therapy and the chiropractor’s office (which I have spent plenty of time in).

Look for opportunities to convert your IRA or 401(k) into a Roth. Better yet, establish a Roth early and contribute as much as you can to it. Then, if you have a year or two where your income is lower, think about converting some of your regular IRA and/or 401(k) funds to the Roth (consult with your tax or financial advisor first).  If you have a lot of money salted away in non-Roth IRAs and 401(k)s, your RMDs will be substantial as you get older. For example, at age 90 the distribution period is 12.2; divide your balances by that number and that is how much you are required to take out (e.g.; $1 million balance divided by 12.2 = $81,967.) As you age, the distribution divisor gets smaller each year.

If you have a  dream for your retirement, make a plan for it to happen.  This is where talking to your spouse is important. If you want to live abroad for awhile, or have an extended volunteer position somewhere, it will probably only happen if you discuss it and plan for it early on. If that is your dream, creative ideas like home swaps, RVs, or even selling your home are ways to make this work. Although pets can make moving away difficult, there is usually a situation that will make it work (like when you are between pets).

Bad luck, an accident, or serious disease can strike at any time.  Get your licks in early.  As we age, long distance travel and more physically demanding trips and activities get harder. Put these into your plan so they come at the beginning of your retirement. Don’t postpone the fun and discover you can’t do it.

Bottom line

If we are lucky, retirement happens over a very long period of time. It is good to be prepared with plans and a knowledge of the potential potholes that might come up. Time spent with a partner, friend, or loved one on this can pay off big in the long run. However your path goes through retirement, having a positive attitude and being flexible is a big advantage.

For further reading:

• 10 Worst Retirement Mistakes – a 3 Part Series (with many comments)
• Biggest Mistakes Choosing a Place to Retire