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My 3 Biggest Retirement Challenges


“Retirement: no job, no stress, no pay.”

Do you know that retirement comes in at #10 of the top 10 most stressful life events according to the Holmes and Rahe Stress Scale? It seems kind of counter-intuitive because work creates so much stress. But take it from me, retirement challenges are real! Here are my biggest ones.

  1. Disenchantment

This one may surprise you but many retirees, myself included, simply have a hard time adjusting to not working and all of a sudden having lots of free time. After my initial honeymoon phase wore off, I started feeling that I’d made a mistake. I missed what I got from work: feeling valued; having purpose; social interactions; rewards (i.e. income); and my external identity. Disenchantment didn’t just depress me, it weighed on my wife too. I was negatively affecting her retirement. I had to change. It took a year for me to identify, work through my issues and find a comfortable retirement routine or Retirement 2.0.

I since learned about The 6 Stages of Retirement: 1) pre-retirement; 2) retirement; 3) disenchantment; 4) reorientation; 5) retirement routine; and 6) end of retirement. I wish I had known about them before I retired. Maybe I would have been better prepared? So to help pre-retirees learn from my experience, I created a very popular video on The 6 Stages of Retirement.

  1. Difficulty in finding community

After 9 years of living in Scottsdale, my wife declared “we should move to Texas”. We weren’t making enough connections and were missing the sense of belonging that community provides. People in our neighborhood seemed friendly but were not interested in being friends. The Sunday after my wife’s declaration I came across an ad for an active adult community called Victory at Verado. With nothing else on our calendar, we drove out there that day. We were impressed by the housing options and amenities but most importantly, the palpable spirit of community. Soon after, we traveled to Texas to check out several similar communities. We love Texas but we decided to remain in Arizona and in January 2020 moved to Trilogy at Vistancia. Even though events and facilities are unavailable due to COVID, we have found our community. We are home!

  1. Low Interest Rates

One of the biggest adjustments after leaving work is income replacement. Many retirees turn to the relative safety of bonds and CDs for income. But it’s hard to generate enough real income with persistent extremely low interest rates and inflation. So generating more income requires taking on more risk which I did with high yield (aka junk) bond ETFs and master limited partnerships (MLPs). Now with COVID wreaking havoc on the economy, there’s greater risk of bankruptcies, less tax revenue for local and state governments and reduced corporate cash flows. So I’ve lightened up on my high yield bond ETFs and do not hold any MLPs. I’m heavy in cash while waiting for the economy to recover. Interest rates will undoubtedly remain low for a long time but a stronger economy will make me more comfortable taking on more risk.

Another way that I’m managing low interest rates is by adopting the FIRE movement’s practice of frugality. Every dollar we spend is purposeful and value-based. And every dollar we don’t spend is one less dollar of income we need to generate.

So there you have it – my top 3 retirement challenges. Let me know what you think and what you’re experience has been.

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