Design Your Dream Retirement

After a 35 year career in engineering, I retired 18 months ago and have thoroughly enjoyed the experience so far. I know some people struggle with the transition from work to retirement so I have written a short blog capturing what I have learned.

For many, the transition from working to retirement is a difficult one. We assume that if we're lucky enough to retire, we'll have a long and happy post-work life. But this isn't always the case. Many retirees suffer from depression, anxiety, loneliness and boredom. In fact, nearly 3 million people in the UK recently returned to work after retiring according to research by Legal and General.

Recent research shows the top three reasons for "unretiring" are:

1. Financial pressures
2. Loss of purpose
3. Staying mentally active

This creates a contradiction: people retire to have more time for themselves, to reduce stress and to focus on family and health. So, how can we make the move from work to retirement less daunting and more exciting?

Looking Forward with Optimism

Retirement is a chance to finally pursue lifelong ambitions without the constraints of a 9-to-5. Many retirees go back to school, learn new skills, spend more time with loved ones, volunteer or get active. Doors that were once closed are now wide open.

You can finally write that novel, take that dance class, visit that exotic location or help a local charity. But this "utopia" can be difficult to reach if you're not prepared and many people struggle in the first few years. So, what can you do to feel less disoriented?

Planning Is everything

It's no surprise that planning is a key element of a successful retirement. The two most important plans you can make are:

1. Financial planning
2. Planning what you will do with your time

While no plan is foolproof, having a framework gives you a great start.

Financial planning

You should start your financial planning at least a decade before you want to retire. You can use an online tool, a spreadsheet or hire a professional advisor. To get started, gather all your retirement income information: pension statements, investment accounts and savings. This will help you calculate your annual income.

If you have multiple pensions or savings, consider getting a financial check-up to ensure your investments are performing well. Most providers have planning tools that estimate your annual returns and total pot size, and it's a good idea to track these values annually.

Next, add up all your expenses. Start tracking your outgoings if you don't already. Account for recurring monthly costs like food, transport, energy and insurance, but don't forget less frequent expenses like home and car maintenance, holidays, birthdays, or large purchases like home improvements. You can also run multiple "what-if" scenarios with retirement calculators to see what your financial situation will look like under different circumstances.

It is worth noting that some pension providers can take up to 6 months to get your money into your hand, so initial short-term cash-flow planning is important too.

Planning what to do with your time

Retirement is awesome. The stress of long hours, toxic workplaces and long commutes disappear. You get total autonomy and freedom. So, what to do with this new found freedom?

Ask yourself questions like:

• Did you have a childhood ambition you never fulfilled?
• Is there a musical instrument you want to learn?
• Do you want to volunteer or start a new venture?
• Is there a place you've always dreamt of visiting?

Then ask yourself why you haven’t followed your dream. If the answer is "lack of time and energy," retirement could solve that for you. However, the period between your last day of work and settling into your new groove can be filled with doubt and anxiety.

It helps to know yourself well. What motivates you? What are your values? Where do you find joy and purpose? Reflect on what energizes you now, both inside and outside of work. Simple personality tests like Myers-Briggs can also help you understand yourself better, but the most important thing is to reflect on whether the results truly resonate with you.

Ideas for things to do

It's unlikely you'll be happy doing only one type of activity. It's smart to have a mix of activities with different goals, but make sure you manage your own expectations.

• Get creative: Creative outlets like painting, photography, cooking, knitting or writing can boost your mental and emotional well-being. They provide an emotional release, spark new ideas and give you a deep sense of purpose and accomplishment.
• Learn something new: Lifelong learning is crucial for mental health, self-esteem, and confidence. You can learn a new language, take an adult education class or master a new skill like brewing or carpentry. This continuous journey of growth will enrich your life.
• Recreation: Recreation is anything that isn't "work." It's essential for a balanced lifestyle. Activities like sports, travel, sewing, hiking or even home DIY projects can reduce stress, improve your mood, and promote physical fitness.
• Personal growth: Retirement is a chance to focus on yourself. Meditation, spiritual discovery, coaching and mentoring can help you stay mentally agile and emotionally resilient. Volunteering, in particular, is a great way to expand your horizons and gain a sense of fulfilment and validation.
• Maintain your social network: As we get older, strong social connections are vital for our well-being. Spending time with friends and family, joining clubs or meeting new people at classes can foster a sense of belonging and keep your mind sharp.
• Embrace idle time: The biggest benefit of retirement is not having to be "on" all the time. It's important to take time for yourself to simply do whatever you feel like doing in the moment. Whether it's scrolling social media, watching TV or "just being at peace" as my grandad used to say, it's okay to do nothing.

It is good to mix things up every day with maybe something from three of these categories. You can also easily combine them, like playing sports with friends or taking a dance class to meet new people. The key difference between work and retirement is that you decide what to do and when.

Getting ready for retirement

Planning for retirement is an ongoing process. As you get closer to your last day of work, your plans need to become more detailed. In your final few years of employment, you should seriously consider things like moving house, downsizing or slowing down your work schedule. Living on a reduced income won't be a shock if you prepare early, giving you more time to get everything in place.

You could also decide to retire from your main career but take on a different, more flexible job to supplement your income. Now is the time to explore new activity groups, charities or educational resources.

Write down the top things you want to do in the short, medium and long term to prepare for your retirement. Here are mine…

This added to all the stuff I was already doing like reading, going to the gym, walking, meeting up with friends, etc. It is not exhaustive and I have added more to this over time, but this was my day one starting point.

Final thoughts

Doing some preparatory thinking and planning like this gets your retirement off on a positive footing. Your plans are as individual as you and some people like to have time mapped out in some detail, whereas some take each day as it comes. My plans are not rigid but do include some regular things and I have a handful of mini projects on the go at any one time.  In no time you will be wondering how you ever had the time to work!

Useful resources

In researching and writing this blog I found the following very useful:

• The work of Lord Richard Layard on happiness
• The Facebook group The Epic Retirement Club
• Legal and General’s research into Happiness in retirement | Legal & General
• Thoughts on workplace stress from Robert Sapolsky Robert Sapolsky Rocks - Welcome to Robert Sapolsky Rocks
• The u3a u3a - Welcome to the u3a