Don't Take the Fun Out of Retirement Planning
Planning for retirement shouldn’t take clients away from their life before retirement, Russ Thornton writes on SeekingAlpha. Fun — living well prior to retirement, that is — should be part of overall financial planning, he writes.
It’s easy to become too focused on preparing a comfortable retirement when financial advisors and the media encourage people to save as much as they can every day, according to Thornton, a financial advisor and founder of Wealthcare For Women. That’s not always optimal, however, he writes, because life doesn’t start with retirement.
Maybe more importantly from a financial planning perspective, being too focused on retirement planning may preclude clients from making important life choices that could lead to a better working life, according to Thornton.
It could prevent clients from looking at ways to retire early, with some adjustments, for example. It could also prevent them from switching to an entirely new job that would be fulfilling enough to work longer, he writes.
Thornton doesn’t recommend abandoning sound retirement planning. Rather, he argues for a healthy balance between retirement goals and supporting a satisfying current lifestyle.
Some women Thornton works with are so fearful of the future that they spend nothing more than absolutely necessary.
On the other side of the spectrum are female clients who take their divorce settlement and go right through it.
A better approach is somewhere in the middle, according to Thornton. And advisors who spend too much time on numbers and economic data rather than on making their clients’ overall lives better may find themselves replaced with another advisor more focused on what Thornton calls “lifestyle financial planning.”