Sep 25, 2014

Secrets of Retirement: There’s More To It Than Meets the Eye


To most young people, retirement means relaxation every day, with mornings spent leisurely reading the paper over coffee, afternoons hitting the links or chilling on the beach, and evenings at pleasant dinners with your spouse and friends or watching your favorite programs.

But for many retirees, it’s just the opposite. Out of 43 potentially stressful major life events, retirement is ranked the 10th most stressful, ranking just higher than a major change in the health or behavior of a family member (11th). The death of a spouse, something many people experience in their retirement years, ranks number one.

Studies show that money tends to be the number one stressor. Running out of money to live comfortably is the biggest concern for members of both the Silent Generation (people aged 68-88) and baby boomers, followed by the worry that they are or will be a burden to their family. Only 39% of people who are actually retired say that it is less stressful than life was during the five years before they retired,

Believe it or not, it’s hard for many retirees to give up working. For some people, a job gives life meaning and purpose, providing satisfaction and happiness. Other retirees get stressed out by the lack of structure in their days, and others find change, even if it’s positive change, to be stressful.

Roughly one in 10 people aged 65 and older report that they are severely lonely, according to a study published in 2012 in the Journal of Psychology. Retirement ends many of the daily connections we tend to take for granted. People in their 80s and older tend to experience higher rates of loneliness than do younger people, other research shows, as spouses and friends pass away.

Worse yet, loneliness can lead to health problems and premature death. Older adults who report extreme loneliness had a 14% greater risk of premature death than those who didn’t. Researchers noted that loneliness can be twice as unhealthy for older people as obesity can, with health consequences that include disrupted sleep, elevated blood pressure, increases in the stress hormone cortisol, altered gene expression in immune cells, increased depression and lower overall well-being.

It’s an unfortunate reality of aging: our health declines as we get older and many retirees and seniors are in denial about their health problems. Almost half of Americans ages 55 — 64 say they are in good or excellent health, while only about a quarter of those 65 and older say the same. Major studies found that the most common ailments facing older adults are hypertension, heart conditions and arthritis. Roughly one in four people ages 65 — 74 and nearly one in three people ages 75 — 84 have two or more major health problems.

 Coupled with declining health, retirees find their health-care costs are huge. While Medicare covers plenty of health-care expenses for older folks, it doesn’t cover everything. In fact, Medicare doesn’t cover longer term skilled nursing or rehabilitative care, hearing aids, eye exams and most dental care. A couple who retire at 65 need an average of $220,000 to cover out-of-pocket medical expenses over the course of their retirement, according to Fidelity Investments—and that doesn’t even count the costs of having to go into a nursing home, which Medicare doesn’t cover under most circumstances

A semiprivate room in a nursing home costs a median of roughly $77,000 a year and living in an assisted living facility costs $42,000 a year, according to 2014 data

Given how little most people have saved for retirement, many retirees are likely to struggle to afford the health care they need. And some are already feeling the strain of these expenses. Nearly one in four retirees say they’ve had trouble paying for the medications that they or their spouse needed; 21% say they’ve had trouble paying for health insurance premiums, 21% for medical bills, 19% for long-term care and 18% for preventative services

 The grass always looks greener on the other side, but life always mixes the good with the bad. Hopefully, this information will make retirement planning a major priority. It's best to prepare for your future, even at the cost of some greater sacrifices in the years before your finally retire.

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