FA Center: What this financial adviser learned about retirement when she retired

As Ellen Siegel transitions into retirement, she’s experiencing the push and pull of giving up her 37-year career as a financial planner.

On the one hand, the 68-year-old loves the freedom that comes with less workaday commitments. But she also admits that it’s tough to jettison a job she knows so well.

“It’s hard to let go,” said Siegel, a semiretired Certified Financial Planner in Miami. In 2016, she started moving from what she calls “a six-day workweek to a three-day workweek.”

“I enjoy the work and the clients,” she said. “But I’m getting older and I have other interests, like doing environmental education. I want to do more of that while I still can.”

Advisors spend countless hours helping clients plan for retirement. So when they themselves call it quits, you’d think they would know exactly what they’re getting into.

For the most part, they do. But even the most well prepared advisers experience their share of surprises.

Like many advisers, Siegel urged clients to accumulate a thick cushion of savings to last through their 90s. But regardless of how conservative their assumptions about spending, the it’s-never-enough fear can set in.

“Retirement will cost you more money than you think,” she declared. “Get real about it. Get a bigger nest egg than you think you’ll need because you will spend it.”

Over the last 18 months of partial retirement, Siegel has found that additional leisure time equates to more temptations to spend. She has gone scuba diving, enjoyed an Alaskan cruise and attended a three-day convention devoted to a favorite hobby: kayaking.

She has discovered that hidden expenses can add up in retirement. For example, her more frequent travels mean she must pay kennels or helpers to care for her seven pets.

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Initially, Siegel took her own advice and tried to practice living without a paycheck. She stuck to a tight budget with an eye toward making her savings last longer.

“After a few months, I found that was no fun,” she said. “It was too uncomfortable.”

She also started to notice that peers—some retired, some still working—suffered injuries that limited their ability to enjoy life. A broken leg or a bad back can stymie the best-laid retirement dreams.

“There becomes an urgency to live, and live fully, that’s much stronger than I expected,” she said. “You want to do as much as you can while you’re healthy.”

Recent months have also taught Siegel that her fantasy of retirement does not jibe with reality. She envisioned waking up without an alarm clock, perhaps visiting the gym for an invigorating workout and returning home and settling in with a cup of coffee and the newspaper.

“But I’m not the kind of person who gets up late and reads the paper,” she said with a laugh. Instead, she’s still motivated by her work and by her volunteer activities.

On a practical level, she has discovered that Medicare Part B premiums are based on adjusted gross income reported for the prior two years. Because one of her last years of full-time advising proved among her best, her Medicare premiums are higher than she originally budgeted.

“So if you’re 63 and thinking of retiring in the next two years, you may want to move income around to make those last two years [before qualifying for Medicare] as low as you can,” she said.

Ellen Siegel offers securities through LPL Financial, Member FINRA/SIPC and investment advice through LWM Advisory services, a registered investment adviser and separate entity.

Morey Stettner is a writer in Portsmouth, N.H. He’s the author of five business books, including ”Skills for New Managers,” published by McGraw Hill.

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