Retirement Pro

I’VE AWARDED MYSELF a professional designation: CER, or Certified Experienced Retiree. In the dozen years since I left the workforce, I’ve learned a great deal about retirement. I’ve grappled with the financial aspects, how your relationships with family and friends evolve, and how your outlook changes over time.

One key lesson learned: A steady income stream provides peace of mind. In my case, it’s from a pension and Social Security. For younger retirees, it could mean drawing savings from a 401(k) or IRA, plus Social Security. But I’ve also learned that retirement finances are a lot more than cash flow.

You need to diversify the source of your funds. This means having taxable investments plus cash for emergencies, market dips and to counteract inflation. A pension is great, but my monthly payment hasn’t changed in 12 years—and it never will. I use dividends and tax-free interest to counteract the effects of inflation.

You also need to cover not just basic living expenses, but your total spending. You’ll want to spend some money on fun and some on other people. Then there are donations to make and extra activities to undertake.

Living on a detailed budget based only on necessary expenses won’t provide you with enough money—and it wouldn’t be much fun.

As with your working years, unexpected stuff will happen in retirement. In our case, an errant baseball caused my wife to lose sight in one eye. We had to adjust, meaning I do more driving for her.

Then, my old employer dropped our retiree health and dental coverage. It gave us a health reimbursement arrangement instead. Now, we have to choose insurance plans on our own. We’re dealing with premium inflation, plus higher prescription costs, than we had under our old plan. Many of my fellow retirees are struggling financially with the change.

Some people worry about all the free time they’ll face in retirement. What free time? My days are full. I read, write, draw, walk, cook, shop, spend time with grandchildren, golf and travel.

True, it isn’t easy letting go of a job that you enjoyed and gave you status. After all these years, I’m still unofficially involved in helping fellow company retirees with their benefits through several Facebook groups.

In my experience, most work-related friends and colleagues fade away. Perhaps more disturbing is seeing others, like your former dynamic boss, cope with Alzheimer’s. It’s depressing. It’s important to make new relationships in retirement. I struggled with that, but finally found golfing buddies.

At age 78, I occasionally think about the future. Have I planned it all correctly? Of course, there are many things to think about when planning to retire. But remember the fundamentals. No matter what, without adequate income, retirement will be stressful.