While year after year we advise people at every career stage, if I had to guess, I’d say our single largest contingent of new clients is comprised of pilots who are preparing to retire and who will soon have money in transition. That is, while money should always be hard at work making even more money, during the transition, the focus for some people shifts from “saving for retirement” to “using that savings to retire.”
But here’s a thought: After you’ve completed your flying career, and someone asks what you do, consider breaking the habit of saying, “I’m retired.” That’s a default answer. Describing yourself as retired implies that you are finished growing or through with reinvention. And that is hardly an accurate description of today’s post-flying crowd. However, until you retire, how can you know what it’s going to be like? After a lifetime of hard work, how can you understand the extent of the challenges you’ll face when flying is no longer the primary driver of not only who you are, but how you spend your time?
Retirement is a transition not an ending. In my experience, the transition into retirement is more likely to be successful if the following three challenges are met.
Most of us spend a huge portion of our lives working to earn money. For many pilots, though stressful and while not everyone loves every aspect of their job, work typically provides satisfaction, status, and most of all, a sense of purpose. But make no mistake – when you transition into retirement, you undergo a massive shift of purpose.
Both during and after that transition, the big question becomes, where will all your purpose land? I say, without any risk of overstatement, that the answer to the “where will all your purpose land” question is among the most important of our lives. The closer a client is to retirement, the more our advisors try and touch upon how one wants to spend their time once that transition occurs. This is because not only does everyone need purpose (they do), but it’s also because happiness and health depend on it.
If you haven’t yet transitioned into retirement or if you already have and are feeling at loose ends, it’s neither too early nor too late to ask yourself, “What can I do to make the world (or my community, or my street, or even my neighborhood) a better place?”
Think of retirement this way: It is no more a destination than a freeway is. Retirement is the metaphorical highway this stage of your life. It’s a system that, when well built, enables you to arrive at your new purpose. With that in mind, the goal should not be to retire but to embrace the change by picking a purposeful destination.
Change your perception about money
Do you view money as a tool that works for you? Far too many people see their savings the way they see the sand in the top half of an hourglass. They view it as an abstract entity that will dwindle year after year until either they pass away or run out of cash.
Picture this: You have $1 million just sitting in the bank. Now, imagine your first year of retirement. Let’s say you take two vacations, then you put a new roof put on your house, and then a child has an emergency and needs to borrow $30,000. Next, subtract living expenses, and you can see that it’s been just a single year since you retired, and now you may have as little as $850,000 left.
The money you’ve saved throughout your life exists to support your new purpose(s) after your transition into retirement. When you view it that way, you may come to understand that there is no magic number that ensures you’ll have enough money to pay for a 30-year, post-flying existence. Your money is a tool and as such, its work never ends – money never gets to retire and live the good life.
Financially, the most worry-free retirements are enjoyed by those who save enough money and invest it in such a way as to be able to live off the interest or dividends (never touching the principal). That is financial freedom and it should be your goal. Your money exists entirely to work for you saving your energy so you can devote yourself to your purpose.
Have you ever heard someone say, “If I’d known I was going to live this long I would have . . .?” The older we are the longer the road stretches behind us. Yet when you drive, do you spend more time looking at the road ahead or looking in the rearview mirror? My experience has been that one of the keys to a successful, happy, post-flying existence is to look forward just as much, if not more, than you look back.
I love nostalgia and enjoy remembering the past as much as anyone but focusing more on the future is to your advantage. But how do you do that? First, it goes back to identifying your purpose. Volunteer. Be creative. Mentor. Maybe you start a new business doing something for which you are passionate. It’s a fact that most happy people have a good reason to get out of bed in the morning. Identify one, then find five more.
Second, while we should all try and embrace each day, another interesting trait that I’ve noticed in happy people is that they don’t worry obsessively about how much time they have. Simply, try not to allow yourself the luxury of hesitating to try something new just because you’re worried you might not be around to enjoy the fruits of that labor.
Third, as I’ve mentioned throughout, happy people resist the urge to think of retirement as an ending or destination. For them, retirement is the transition to another exciting part of an ongoing life – a next chapter.
So, how do you want to be remembered? Commit yourself to living well today with purpose, but also with your eyes looking ahead toward a long and rewarding future.
Want to be confident that your financial plan will set you and your family up for success leading up to and through retirement? I encourage you to request a complimentary call with one of RAA’s airline-specialized advisors at raa.com/consultation.