Ameriprise Financial recently released the findings of the New Retirement Mindscape, a study that explored people's attitudes, worries, behaviors, ambitions and needs before and after retirement. Working with Ken Dychtwald, Ph.D., an authority on baby boomers, Ameriprise determined through its study five stages of retirement.
"Up until now, no one has so thoroughly investigated the mindscape of retirement," said Ken Dychtwald, CEO of Age Wave. "Baby boomers, who are starting to turn 60 this year, are probably well aware of the financial challenges that lie ahead, but few may realize what they will experience emotionally. Incredibly, we have discovered that retirement is a complex process made up of distinct emotional stages, similar to other well-known life transitions, such as pregnancy or grieving and loss."
Market research firm Harris Interactive conducted the survey via a telephone in August 2005 to 2,000 adults age 40 to 75 with a margin of error of the overall sample of +/– 2.2 percent at the 95 percent confidence level. Following are the five stages of progression into retirement named by the New Retirement Mindscape study:
Imagination (15–6 years before retirement): Retirement is still years away, but during the Imagination stage, people have very positive views about retirement, although only 44 percent say they are "on track" in terms of preparation. In this stage, people have high expectations of adventure (65 percent) and empowerment (53 percent) for retirement.
Anticipation (5 years before retirement): As retirement draws closer, positive emotions are on the rise with 80 percent saying that they "will be able to achieve their dreams in retirement." However, in the two years before retirement, worries and anxiety mount with 22 percent saying they will feel a sense of loss after their working years are over. The most commonly cited triggers for retirement readiness were achieving "financial freedom" (18 percent) or a significant birthday (16 percent).
Liberation (Retirement Day and one year following): This is a time of great excitement, relief, and enthusiasm as 78 percent of people say they are "enjoying retirement a great deal." But, similar to a honeymoon, the feeling of liberation is short-lived, as a new reality soon begins to set in.
Reorientation (2–15 years after retirement): During the Reorientation stage, many say the joy of retirement has passed, giving way to feelings of emptiness (49 percent), worry (38 percent) and boredom (34 percent). This is the point in the progression where an emotional let-down may occur to varying degrees. Four distinct profiles emerged in the Reorientation stage:
- Empowered Reinventors (19 percent)
- Carefree Contents (19 percent)
- Uncertain Searchers (22 percent)
- Worried Strugglers (40 percent)
Reconciliation (16 or more years after retirement): This stage is marked by increased contentment, acceptance and personal reflection. People have come to terms with all that retirement has to offer. While there are lower levels of depression (5 percent), some people (22 percent) report feelings of sadness as they confront end-of-life issues.
The group of retirees referred to as Empowered Reinventors stands out as role models and may be the first glimpse of how many baby boomers will reinvent retirement. This group, which was the most proactive about retirement planning, is most apt to view retirement as a time of new adventure (70 percent) and empowerment (56 percent), with almost half (43 percent) saying doing more meaningful or satisfying work is very important to them.
The New Retirement Mindscape study also revealed that having "more control over their own time" was the best thing about retirement for 44 percent of retirees, followed by 23 percent saying "the opportunity to relax" was what they enjoyed most. Another 17 percent said the best thing about retirement was "having the chance to reinvent their life."
When asked what was the hardest thing they experienced in retirement, respondents expressed concerns over health insurance (24 percent) and loss of income (24 percent). An additional hardship in retirement was the loss of social connections at work (22 percent).