There’s More to Retirement Than Savings

Being emotionally prepared for the transition is as important as sound financial planning, TIAA says.

Getting emotionally ready for one’s retirement is just as important as saving enough, according to a survey of 1,500 retirees by TIAA.

Retirees experience stronger ties in their relationships with friends and family, the survey found. Ninety-three percent of retirees said that their relationships with friends remained steady or improved, while 96% said the same of their associations with family members.

As for their dealings with their spouse or partner, 95% said it remained the same or improved. Eighty-five percent of retirees with a spouse or partner who said their transition into retirement was easy said that they and their partner share the same outlook. By comparison, 53% who had a difficult transition do not see eye-to-eye with their partner.

“Like any major life change, retirement can have a significant impact on relationships,” says Roger Ferguson, Jr., president and CEO of TIAA. “Our research shows that taking the time and care to plan for this transition—both emotionally and financially—helps to set up retirement success. For couples, going through the planning process hand-in-hand helps both partners more easily adapt to retirement.”

Retirees also report that they try to stay active. Among those who participate in 10 or more activities, 76% say they are satisfied with their retirement lifestyle, while only 52% of retirees who participate in one to four activities are happy. Retirees age 80 or older, however, say they are not nearly as engaged as they were when they were younger.

The No. 1 way people spend time in retirement is pursuing interests and hobbies on their own, a stark contrast to the team approach they experienced in the workplace, TIAA notes. This represents a big shift from working life, and is an important shift for retirees to prepare for psychologically, the firm says.

NEXT: Retirees’ sound financial outlook

A heartening finding from the survey is that 86% of the retirees said that they are satisfied with their finances. Fifty-four percent said that they have not had to make and lifestyle adjustments, although 20% have made such minor changes as buying fewer clothes or eating out less.

Sixty-five percent are either volunteering or working with charitable organizations. Seventeen percent are working for pay, and of this group, only 5% are doing so for purely financial reasons.

Thirty-three percent of retirees between the ages of 66 and 69 say they are putting a priority on charitable giving, and this rises to 43% of those 80 or older. Leaving an inheritance is significant to 28% of the younger group and 49% of the older group. Eighteen percent or the former want to ensure financial security for their dependents, increasing to 33% of the latter.

TIAA also looked at the activities of male and female retirees. Retired women are more likely to engage with others and give back to their communities by volunteering (58% of women versus 42% of men) or caring for family members (43% versus 26%). Men are more likely to pursue active personal hobbies, like sports (38% versus 18%) or work (28% versus 19%).

Male retirees are also more confident about their finances, with 77% saying that they found the transition into retirement easy, compared to 69% of women. Fifty-eight percent of male retirees are very satisfied with their financial health, compared to 46% of female retirees. Twenty-nine percent of retired women, on the other hand, are worried about running out of money, compared to 15% of their male counterparts.

Aging is a concern for both sexes. Fifty-three percent of retirees worry about becoming a burden to others, 46% agonize about a spouse or partner dying, 44% think about what their life will be like if their mental abilities deteriorate, and 43% worry about mobility issues. TIAA notes that this is why retirement plan participants should invest in health savings accounts and those approaching retirement or in retirement should consider long-term care insurance. The investment firm also says that retirement plan sponsors should include lifetime income options in their investment lineups.

GfK Custom Research North America conducted the survey among a total of 1,583 TIAA retirees between May 28 and August 27, 2015. TIAA’s full “Voices of Experience” report can be downloaded here. The survey is a follow-up to a similar survey TIAA conducted 34 years ago, in 1982.