Withdrawal Symptoms

Jeffrey K. Actor

I SHIFTED TO WORKING part-time more than a year ago. It was a way to ease into retirement and give me time to explore new activities. My reduced work hours were also a way to experience life without the singular job focus that had defined my working years and, indeed, my identity.

My new part-time status was, of course, accompanied by a markedly shrunken paycheck. That allowed my wife and me to see what it was like to be without the guaranteed and steady income we’d relied upon for nearly three decades.

After more than a year of working part-time, I fully retired two months ago. Without a paycheck, our bank account balance soon fell to a level where we needed to transfer funds from savings to pay the monthly bills. The amount I transferred was equal to just over half of my fulltime monthly paycheck.

The mental anguish was palpable.

I knew the day would come when we’d begin spending down our financial accounts. But I was mentally unprepared for the angst and anxiety that raged inside my head. This reaction was completely emotional—and totally unexpected.

Before retiring, we’d done our math, considered dozens of scenarios, and had full confidence that our savings strategy over our careers was more than sufficient to provide for our retirement needs. We knew that our savings were, in the end, meant to be spent.

Still, when the time came to withdraw funds from our investment portfolio, I was unable to sleep at night and had a devastating migraine lasting several days. It took two weeks for me to gather the courage to push the transfer button and reclaim some dollars from our savings. I was in a full “deer in the headlights” panic, caught up in an emotional state that couldn’t be overcome by logic.

Over the past year, while I was working part-time, my wife and I discussed supplementing our reduced pay with extra savings. We had set aside close to three years’ expenses in high-yield savings accounts and short-term certificates of deposit. But until I fully retired two months ago, we never dipped into those funds.

Rather, we simply found a way to survive—and thrive—on our reduced income. Perhaps by serendipity, there always seemed to be a bit of extra cash coming into the household, either from unexpected consulting gigs, gifts or dividends.

Psychologists say that, at every stage of our life, personal growth is important for our emotional health. As we age, it’s critical to challenge our thought patterns so our brains stay healthy, both physically and emotionally. Still, before now, I’d never considered evaluating my financial journey in terms of personal growth and never considered that such an evaluation was important for my mental health.

Researchers contend that paying attention to our own well-being helps put us on the path to lifelong learning. We should continually challenge our established ways of thinking, because this is the key to successfully adapting as our life’s circumstances change.

There are numerous books and articles on ways to challenge our current thinking about how to achieve financial success. Many recommend trying to balance logic with consideration of what feels right emotionally. In our financial journey, one of the greatest emotional challenges is the transition from accumulating money to drawing down those funds during retirement.

Other HumbleDollar writers have written about strategies to enhance guilt-free spending during retirement. Some recommend delaying Social Security and buying an income annuity to guarantee a minimum level of monthly income. Others suggest investing in stocks with a history of consistently paying dividends. Yet others advocate building a ladder of individual bonds or certificates of deposit to meet future spending needs.

Until now, I never felt the need to use such strategies. I didn’t realize how powerful these concepts could be in securing emotional tranquility during retirement. I realize now I should have given more consideration to these ideas before leaving the workforce.

Perhaps it’s time to reevaluate my investment strategies and embrace new methods that satisfy both my logical and emotional sides. After all, a personal investment strategy is meant to be, well, personal. It should change as my life’s path changes. I hope I’m up to the challenge.

Jeffrey K. Actor, PhD, was a professor at a major medical school in Houston for more than 25 years, serving as an academic researcher with interests in how immune responses function to fight pathogenic diseases. Jeff’s retirement goals are to write short science fiction stories, volunteer in the community and spend time in his garden. Check out his earlier articles.

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