How Much Money Do You Need to Ensure a Happy Retirement?
This question takes for granted the huge assumption that there is an amount of money guaranteed to make you happy in your post-work years. Having enough money is important, but there's no magic total that will automatically bring happiness.
Steven Vernon, a Forbes contributor and author of Don't Go Broke in Retirement, is a former actuary. He's spent decades helping companies distill the risks associated with human behavior down to dollars and cents.
Vernon's biggest piece of advice, as you might guess from the title of his book, is don't run out of money. But as he explores the topic of planning for an enjoyable retirement, he finds that people must look beyond mere finances.2
"It turns out that happiness can be a complex goal," writes Vernon. In fact, it's not really the best word to describe a satisfying life. Psychologist Martin Seligman prefers words like "wellbeing" and "flourishing." He suggests that these concepts have five dimensions: positive emotions (such as pleasure), engagement, relationships, meaning, and accomplishment.
Vernon notes that much of the advertising around retirement focuses solely on the first dimension. "They often depict a smiling couple walking hand in hand on the beach at sunset," he writes. "They focus only on the 'vacation' part of retirement." While retirement should include pleasurable experiences, living as if you're on a 30-year vacation soon can lead to dissatisfaction. It's an expectation that's impossible to sustain. Long-term wellbeing depends on having a fully rounded life.
Having the financial resources to meet your needs is important for a successful retirement. But money by itself won't make life fulfilling. Remember to consider and plan for the other key components you will need to thrive during your golden years.
1. http://go.pardot.com/e/91522/wex-beg-the-question/8nn2mw/1744565582?h=KIe17KTnNOjAyp8BVhggFjAgQ3IrkjhGy4LWts36lWY
2. http://go.pardot.com/e/91522/d-to-be-happy--sh-3e77349f6d8d/8nn2mz/1744565582?h=KIe17KTnNOjAyp8BVhggFjAgQ3IrkjhGy4LWts36lWY
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