#96 - Preparation or Timing: What Really Determines a Successful Retirement

Eric Blake: The real question is not, will retiring early shorten my life? I think it is, if I live longer than expected, will my plan support me?

Welcome to another episode of the Simply Retirement Podcast, where we want to educate and empower women to live your retirement on your terms. I am your host, Eric Blake, practicing retirement planner for over 25 years, founder of Blake Wealth Management, and I would not be the man I am today without the women in my life.

Joining me again today is Wendy McConnell. Wendy, how are you?

Wendy McConnell: I'm good. Thanks for having me.

Eric Blake: Absolutely. I am very curious to see how this conversation goes. I think you are going to have some insights, some thoughts, as you always do.

Wendy McConnell: Yeah. Good or bad.

Eric Blake: That is okay. It is all right. It is good feedback.

So I think that is one of the great things about us working together. We focus on women over 55. I am not going to throw ages out there, but you are kind of in that area.

Wendy McConnell: I'm over 55, just barely, but I'm over 55.

Eric Blake: The reason I think you are going to have some interesting thoughts on this is that I am going to talk about an article titled, Is Delayed Retirement Bad for Your Health?

Wendy McConnell: Okay.

Eric Blake: This is written by, and I am probably going to butcher the author's name, Michael Finke. He is actually a financial advisor. ThinkAdvisor is a publication written for financial professionals.

The reason it caught my attention is because it was responding to something spreading around social media. This article is actually from the latter part of December, I think it was. What was going around, or what he was responding to, was the idea that you should retire as soon as possible because you will live longer.

Wendy McConnell: Okay?

Eric Blake: Obviously we are talking about statistics here, and as you know we can make math say whatever we want it to. Each side was using its own statistics and coming to different conclusions.

I think that is part of the problem. We know numbers can describe patterns, but as the saying goes, you can pretty much make numbers say what you want them to say. You just have to find the right numbers to back up your argument, right? That is the way life works, is it not?

Wendy McConnell: I mean, I think it is probably common sense. You would think if you do not have to get up and do the daily grind, whatever that might be, that it would be better for your overall health. But that is not necessarily true. The numbers do not make that true unless you make them make that true.

Eric Blake: I think that is one of the big things I want to point out here. Statistics should not decide your life. You do not want to base your decisions on somebody else's statistics.

What I want to do is walk through the article, what it actually shows, and bring it back to what I think really matters. Again, we are not worried about statistics. We are really worried about your personal retirement plan.

The article's objective was to show that retiring early does not automatically lead to a longer life. I want to take that one step further and understand that while retirement timing alone does not determine longevity, planning can strongly influence not only your financial well-being but also your physical and mental well-being as well.

For all the links and resources, including the link to the article, you can visit thesimplyretirementpodcast.com.

All right, so here is what the article talked about. The article included a study comparing people at age 65 who were still working with those who were already retired by the age of 65. Then it looked ten years down the road. On average, those still working actually had a higher survival rate.

At first glance that sounds like working longer improves longevity. But the real question is this. Are people living longer because they work, or are they able to work because they are healthier?

That was really the focus of the article. Many people retire early because of health limitations or health issues. So the working group naturally includes more people healthy enough to actually keep working.

Wendy McConnell: Okay.

Eric Blake: The retired group then includes more people who are already facing some of those health challenges. I think that explains a lot of the difference.

The researchers also looked at an interesting aspect, and that is how healthy people think they are.

Wendy McConnell: Okay.

Eric Blake: Respondents were asked how they would rate their own health. Do you feel extremely healthy, average, below average? How do you feel your health is?

The statistics indicated that those still working tended to live longer, although the gap narrowed when health was taken into consideration. If you are retiring early because of health, that potentially means you have a shorter life expectancy.

Wendy McConnell: If I think that I'm pretty healthy though, does that mean I'm right? That is what I am thinking. I do think I am pretty healthy, but something could happen next week. I could get a diagnosis or something.

Eric Blake: Absolutely. That is where planning becomes the next step in this conversation.

We cannot control everything. We can influence our health and hopefully make better decisions, but some things are simply out of our control.

The one thing we hopefully can control is our financial decision making. Making better financial decisions might improve your health and longevity long term if you are not stressed about money decisions or running out of money.

What the study does not really measure is financial health. It looks at when someone retired and what their life expectancy was from that point forward. It does not measure savings, income security, financial stress, or any of those aspects.

So it explains some longevity patterns, but it does not explain retirement readiness. Am I actually ready to retire early? If I choose to work longer, is it because I have to? Or is it because that is simply my plan?

Both ideas, retiring early to live longer or working longer and living longer, are built on averages. But retirement decisions are not made on averages. They are made by individuals.

There was also one consistent result that I want to point out for our audience. Across every version of the studies included in the article, women lived significantly longer in every category. We will come back to that in just a moment.

Wendy McConnell: I like that, by the way.

Eric Blake: I bet you do.

The study focused on employment and health status, both physical and perceived health, but not financial preparedness.

If you are talking about early retirement, sometimes that is the plan and there is nothing wrong with that. But one thing I want to point out is that often, especially for women, it is not necessarily the plan.

Sometimes it is not their own health that impacts retirement decisions. It is the health of those around them.

Many women leave work because of caregiving. That could be for a spouse, aging parents, or other family responsibilities. That can reduce income, reduce savings, and increase stress.

We know the statistics around caregiving and the mental challenges women face when they are in those caregiving roles. That has to be considered as well.

Early retirement is not always a choice. Sometimes it is simply a life event that happens. That is where planning can help you prepare for both scenarios.

If you are married, both spouses should be actively involved in the planning conversations.

First, this is too much to place on one person. Second, even the primary decision maker might make the wrong decision. Yes, I am pointing at men right now.

The wrong decision will most likely impact the wife more, or at least longer. That brings us back to longevity.

Across early retirement, delayed retirement, perceived health, and actual health, women consistently live longer than men.

Here is a statistic I talk about quite a bit. If you look at a healthy non-smoking couple that retires at age 62, there is roughly a 50 percent chance that one spouse will live to age 92 or beyond. Most likely it will be the wife.

That means we are talking about a potential thirty-year retirement.

The real question is not whether retiring early will shorten your life. The real question is whether your plan will support you if you live longer than expected.

Retirement is not just about longevity. It is about financial longevity. Your plan needs to last as long as you do.

If you outlive your money, that is a problem. For many women, longevity is not theoretical. It is reality.

That is where preparation becomes even more important.

We cannot control how long we live. We can influence it with healthy choices, but we cannot guarantee it.

What we can influence is how retirement feels.

Financial uncertainty creates stress. Questions like, am I spending too much, will I run out of money, or what happens if the market falls?

Wendy McConnell: All right. Are you directing that at me?

Eric Blake: Not directly. Subtly, maybe.

A plan replaces guessing and gives you direction. Proper planning should support how long your money lasts as well as how long you live.

Reducing financial stress can matter just as much as physical health decisions.

You want to exercise, spend time with friends, stay socially active, and enjoy retirement. But if financial stress overwhelms you, it can affect your physical health as well.

Wendy McConnell: Yeah. It could make you physically unhealthy.

Eric Blake: Absolutely.

Retirement itself is relatively new in human history. For most of history people worked until they could not work anymore.

Wendy McConnell: You worked until you died, basically.

Eric Blake: Exactly.

Retirement has really only been a major focus for the past few generations.

People often talk about retirement as a choice. In some ways that is true. But retirement is only a choice until it is not.

Eventually retirement chooses us.

Wendy McConnell: What you are saying is that eventually you are going to have to retire.

Eric Blake: Exactly.

Something physical or mental will eventually prevent most people from continuing to work. At that point financial preparedness becomes extremely important.

Preparation matters more than timing.

If you want to retire early, have you prepared yourself to do so?

Wendy McConnell: Yeah. And start preparing now.

Eric Blake: Exactly.

Preparation begins by identifying what matters most to you and building your plan around that.

If you retire early, what are you retiring to? What will you do with your time?

We did an episode a while back about the thousand hours of retirement.

Wendy McConnell: Pickleball.

Eric Blake: Pickleball could fill four hours a day.

But everyone still has to figure out what they will do with the rest of their time.

Wendy McConnell: Golf does not count, right? People think they are just going to golf every day, but many say it was not as great as they thought it would be.

Eric Blake: Exactly.

It requires creativity. It requires understanding what activities and relationships will fill your time.

The financial plan supports those activities, but money itself should not be the goal.

The goal is what money allows you to do.

Whether that is traveling, spending time with grandchildren, playing pickleball, or whatever matters most to you.

The deeper question is whether you have a plan that supports a long life if you have one.

Preparation determines whether retirement feels uncertain or freeing.

As we wrap up, the key takeaways are these.

Research explains patterns, but planning determines outcomes.

Health may influence when retirement happens, but planning influences how retirement works.

Women especially must plan for longer lives and not fear them.

Statistics describe averages, but only a plan supports your future.

Any final thoughts, Wendy?

Wendy McConnell: Not really. I just encourage people to start planning. I was afraid to look into it for the longest time because I was afraid of what it might say. But even if you do not like what it says, you still have time to change it.

Eric Blake: Absolutely.

It is like going to the doctor. Nobody wants to go because they might hear bad news.

But the only way to fix something is to get a diagnosis first.

Wendy McConnell: Exactly.

Eric Blake: Financial stress can have a major impact on health and well-being.

Planning helps reduce that stress and gives you clarity about what is realistic.

If you are trying to decide when retirement makes sense, the next step is understanding what your plan says, not what averages say.

If you are looking for clarity about your future, you can schedule a conversation with our team at getmysimplyretirementroadmap.com.

That is it for today’s episode. For all links and resources mentioned today, you can visit thesimplyretirementpodcast.com.

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Until next time, please remember retirement is not the end of the road. It is the start of a new journey.