All of us baby boomers are familiar with the bleak studies about what we’ll face in retirement.
Skimpy savings combined with a decline in health and the emotional changes that come with leaving the workforce could make for some pretty dismal golden years, experts predict.
But hold on a minute.
And even better, some research suggests you don’t need a huge nest egg to be happy.
Keep reading to learn more…
Happiness and Heath in Retirement
Using data from the University of Michigan Health and Retirement Study, researchers at George Mason University and Utah State University discovered retiring is associated with an immediate increase in happiness and the positive effects last for four years after their last day on the job.
Retirees also experienced improved health. Health, however, took a bit longer to achieve – on average, four years.
“We suspect it’s because health changes slowly,” Sita Slavov, a public policy professor at George Mason University and co-author of the report says. “It takes time for lifestyle changes to show up in the form of improved health.”
“One other interesting thing,” he added, “[is] we didn’t find any evidence of long-term changes in health care utilization – i.e. doctor visits and prescription drug use – after retirement. So the improvements in health do not appear to be associated with increased health care costs.”
More good news! Love it!
So, according to these studies if you want to feel better emotionally and physically, you may not want to keep delaying retirement. But what if you have limited savings?
Chances are if you are an older boomer who has been retired for a few years, you’re feeling pretty good about your finances – even if you don’t have that million dollar-plus nest egg experts say you need.
That’s what Ameriprise Financial discovered in a survey earlier this year. Turns out 76 percent of boomers with $100,000 in investable assets who retired in the last five years felt “in control” of that decision. Some 57 percent say they are very satisfied with their financial situation in retirement.
“I was pleasantly surprised by how happy they are,” said Marcy Keckler, vice president of financial advice strategy at Ameriprise.
“Happiness is a positive cash flow,” says Ken Moraif, founder and senior advisor of Dallas-based financial firm Money Matters. He argues that people with modest means who keep their expenses low can be happier than those who have more money coming in each month but spend it all. “You can have fancy cars and fancy houses, but you’re going to be miserable all the time,” he says of the latter group.
Andrew Meadows, producer of the documentary, Broken Eggs, says he sees seniors getting creative with figuring out how to stay happy while also making ends meet after leaving their careers.
“When I worked on ‘Broken Eggs,’ I found so many people living in their RVs in semi-permanent spots,” he says. While living out of an RV saved money, Meadows says it wasn’t a desperate move for the retirees he met. “It never seemed like [they] were forced out of their homes. It seems like people planned on that life in retirement.”
Planning for a Happy Retirement
I love these studies, but it’s important to remember that you shouldn’t expect retirement to magically improve your life.
Taking steps now can help boost happiness and health when the time comes. Save as much as possible while you’re still working, make plans to stay active and engaged in a wide variety of activities, and take care of your health.
If you do so, for many of you baby boomers, the golden years can be just that.
Images courtesy of bplanet and photostock at FreeDigitalPhotos.net.