Life stages in retirement

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In his book, “The Prosperous Retirement: Guide to the New Reality,” Certified Financial Planner professional Michael Stein describes the three stages of retirement: the go-go, the slow-go and the no-go years.

Retirees that recognize the different physical and financial requirements of these stages can better meet their goals.

The go-go years take place in early retirement. You’ve broken away from your workday routines so you can start achieving those life goals you had put off during your earning years. Whether you want to travel, volunteer, master a sport or hobby, you’ve got both the time and energy to accomplish these goals. The go-go years can be expensive as you fund these pursuits.

From there it’s the slow-go years. Seniors dial back their activities and their retirement income needs may lessen because of the change. In the no-go years, age and health considerations may preclude participation in many activities previously enjoyed in retirement. Healthcare spending may increase, creating retirement income needs that outpace the reduction in spending on activities.

I’ve avoided putting age brackets on these stages, because they can vary so much by individual. Both health and financial circumstances can influence which stage you’re in, and how you live. I’m sure there are 90-year-olds stuck in the go-go years, and 70 year-olds that don’t want that lifestyle any more.

Anecdotally, I’ve seen seniors make changes in their go-go years that have to be undone as they transition into the next stage of retirement. That’s OK, but the costs associated with these transitions will still need to be met. Moving to Florida to retire may seem like a great idea until you need family or friends to help you get through the day.

The financial implications of these transitions are important. Live too frugally in your go-go years and you miss the opportunity to capture those life goals. Spend too freely and you risk outliving your money in retirement.

If you’re retired, which group are you in? What was/is your approach to spending in your go-go years?

Read about home-share programs that benefit seniors.

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