From the January 2005 issue of Investment Advisor • Subscribe!

January 1, 2005

Retiring Personalities

Offer help to clients who aren't ready to say goodbye to work

Retirement used to be viewed as a sort of honorable discharge from the workforce. On the long-awaited day, the boss would extend thanks from a grateful company, co-workers would salute, and the new retiree would step out of the ranks into a new life of greater leisure.

With the leading edge of the baby boomer generation now nearing 60, concerns about when you should retire, how much you should retire, and even if you should retire at all are changing this simple vision into a much more complicated picture. Your clients typically have more control over the retirement process--which can lead to challenges that no one anticipated. Here are some examples, with my suggestions on how to handle them.

When I was discussing retirement plans with a client couple in their 50s, the husband confessed that his dream was to sell their home and sail around the world. The wife said that as long as she had a home to come back to, she would be willing to spend some time traveling. When he prodded her to be more adventuresome and detach herself from places and possessions, she retorted that she would rather keep working than drift around homeless. How can I help them resolve this dispute? Women are often the voice of home and hearth, gathering relationships as a source of strength and comfort. By contrast, men are apt to seek new challenges. Risk-takers, adventurers, hunters, they tend not to value staying in one place as much as women do.

I see your role as a therapeutic mediator, helping each partner to recognize the validity of the other's feelings. Practice empathetic listening techniques with each client, playing back what he or she says and validating what makes sense to you from that particular perspective.

Try to empathize with what else they may be feeling, and encourage each to put himself or herself in the other's place. If the wife feels that her husband has heard and understood her need for stability and comfort, she may be willing to travel a little more. He, in turn, may agree to compromise on the home issue. When both partners' needs are respected, new solutions often present themselves. For example, they might look into renting a place near one of their children as a semi-permanent home to return to.

Your client couple should also consider that it may be time for them to "individuate" further. If his need to see the world is much greater than hers, why shouldn't he take some trips on his own? In later life, long-married couples often begin to exercise more autonomy where their individual interests are concerned. If they work hard to stay connected, these times apart can actually work to enhance their relationship.

My client, a corporate executive, expects to continue his fairly lavish lifestyle after he retires in two years. But when I crunch the numbers, the odds are that he will either have to drastically reduce his expenses or hope for an early demise. How can I make this message palatable to him? "Odds" are probabilities, not certainties. But if you calmly explore a variety of scenarios with this client, he may come to see for himself that the long-term chances of sustaining his current spending level are slim. By living more modestly now, he can increase his options in the future.

You might mention early in this discussion that most people need to make changes in their spending when they stop work, and that being creative about this can actually be part of the adventure. Suggest a few examples tailored to his interests, such as joining a hiking group instead of paying health club fees, or learning the art of fine cooking instead of dining at expensive restaurants. You might also ask what activities he plans to pursue when he retires, and discuss ways to do them more economically.

Try to meet with him every few months as he goes through this radical change. Keep encouraging him to adjust his lifestyle to his new financial situation. If he doesn't get the message, at least you will know you've tried your best.

This dilemma is bound to confront many soon-to-retire people whose lifestyle expectations exceed their resources. An enterprising planner might consider starting a group where these clients can discuss the challenge of living within their means with others who have successfully made the transition. If you have the energy and commitment, you may want to lead or coach the group. You could even admit non-clients for a small fee.

My 69-year-old client hoped one of his children would run the business he built, but they all chose other careers. His oldest grandson, who is just starting college, has promised to join the company after graduation. My client would dearly love to keep running the business until his grandson is ready to take charge. However, his wife wants him to start phasing out his role in the company now, so they can enjoy retirement while their health is good. How should I advise them? If you decide to take on this high-stakes challenge, be prepared to dedicate some time to it. What the husband and wife want sounds almost mutually exclusive.

I think it could be valuable to meet with each one individually to learn more about their needs and wants, past issues and disappointments. The husband seems to be pinning his hopes on passing the business to his grandson, but this may be an unrealistic expectation. Ask him about the possibility that the boy may change his mind before graduating, or turn out to be no good at running a business. Find out whether he shares his wife's desire to take it a little easier while they both have their health. When you meet with the wife, see if she sympathizes with his need to keep his work identity going until he can pass the torch to a member of the family.

If you can help each of them to understand the other's needs, a degree of "meeting in the middle" may be possible. For example, perhaps he would be willing to groom someone outside the family (with more experience than the grandson will have) to share his leadership of the business, freeing up time for him to travel or enjoy other leisure pursuits with his wife.

A client just called me about her husband, who retired three months ago. She begged me to concoct some financial figures to show that he needs to go back to work. Apparently he's underfoot most of the time, hanging around the house and going with her whenever she runs errands. She says it's driving her crazy. What should I do? This situation is far from unusual. In fact, I'm surprised there isn't a support group for women who want to get a newly retired hubby out of their hair.

You might suggest to this client that instead of fudging the numbers, you would be glad to set up a meeting with her and her husband to discuss how their retirement is going. Ask her how she would feel about your getting together with him one-on-one before this conference. If she is fine with the idea, you have an opportunity to elicit whether he is truly living out his retirement dreams, or whether he feels depressed and at loose ends. Find out if he is concerned about no longer bringing income into the family. You might also ask what he thinks his wife is feeling, now that he is around so much.

If these issues affect him at all, some kind of part-time work or outside interest may be in order. Would he like to volunteer somewhere? Tutor or mentor kids? Join a club or affinity group? Learn a new language?

If you are sensitive and patient in facilitating honest discussion between this couple, you may be able to help them meet the challenges of retirement with solutions that work well for both of them. Granted, not everyone is willing to take on this task. If it's too "touchy-feely" for you, I would recommend referring them to a couples counselor or therapist who can help them deal with this new dilemma of too much togetherness.

Are there people who just shouldn't retire? A client confided to me that he gets scared when his wife talks about quitting work next year. She has a complex job that deeply satisfies her, and he worries that leaving her dazzling career may break her heart in a literal as well as figurative way. He wants me to talk her out of retiring. How should I handle this? I think you need to know more about where your client is coming from. Did someone in his family die soon after retiring? Does his wife get sick or depressed when away from her job? Does she have a personal or family history of depression? Does he?

Once you've learned more about why he is so concerned, invite the wife to meet with you. Explore her thoughts and feelings about giving up her career, especially in view of its importance as a source of validation and self-definition. If she doesn't regret walking away from her wonderful job and feels confident about retiring, that's fine. Should she have any concerns similar to her husband's, you and she can brainstorm ways to absorb her energy and use her talents, perhaps by working part-time or taking on a volunteer project.

Finally, a meeting with the husband and wife together to discuss these options would be a gift to that will allow them to plan a road map to retirement, helping him feel more supported and less panicky while assisting her to stay balanced and at peace.

As your clients' trusted advisor, you can go beyond simply helping them figure out the financial aspects of retirement. Hear and honor their dreams related to this momentous life transition. Encourage them to articulate their desires, fears, and concerns. Most important of all, try to help them brainstorm what their retirement will look and feel like, and keep tweaking solutions to conform with the changing realities of older age. If you undertake this with compassion and patience, I believe your clients will be grateful to you for many years to come.

Olivia Mellan, a speaker, coach, and business consultant, is the author with Sherry Christie of The Advisor's Guide to Money Psychology, available through www.investmentadvisor.com. You can e-mail Olivia at om@moneyharmony.com.

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