Recently, an acquaintance of mine admitted that it was time to start thinking about retirement. “The problem,” he said, “is that I don’t even know where to begin!”
I told him that, before doing anything else, he should ask himself …
The Six “W” Questions of Retirement
Do you remember learning the six “W” questions in grade school? They are as follows: Who, What, When, Where, Why, and How. For decades, these questions have served as an excellent way to gather information, whether you’re a journalist, a detective, or anything in between. But these questions can also apply to planning for retirement. For example, ask yourself:
Who do I want to spend my retirement with?
One of the greatest joys of retirement is that it can provide you with more time to spend with the people you love. So ask yourself, who are the people you most want to spend time with? Your spouse? Your grandchildren? Old friends? People in your golf club, acting class, or church group? Whatever you come up with will help you answer the next question:
What do I want to spend my retirement doing?
If the answer to the “Who” question is your grandkids, then the answer to the “What” question may be, “I want to spend my time teaching my grandchildren how to fish.” If “who” equals your spouse, then “what” may be “re-living our honeymoon.”
When do I want to retire?
A very important question. Have you always dreamed of retiring early, or are you someone who would rather work for as long as possible? The answer will determine how much you’ll need to save for retirement, how to take your Social Security benefits, and so on.
Where do I want to retire to?
Some people stay put after they retire; others move somewhere far away. Again, the answer to this question is largely affected by your answers to the first two. Maybe you’d rather live closer to your other family members. Maybe you’re looking for a different climate. In the end, you should retire to wherever will best allow you to accomplish the things you want to do, with the people you want to do them with.
Why do I want to retire?
A surprisingly important question. You should never retire just because you’re 65, or because you don’t know what else to do. People who make that mistake often find retirement to be boring or unfulfilling. Instead, ask yourself why exactly you want to retire. If the answer is something like “because I want to broaden my horizons and grow as person,” or “because I want to write that novel I’ve always had kicking around in my head,” then you will probably be happier than if the answer is simply, “because I’m tired of waking up at eight in the morning every day.”
How will I pay for my retirement?
This is key. As you know, you can’t just pick a day to stop showing up to work and think that’s enough. Retirement creates a massive lifestyle change, one that will be quite upsetting to your finances if you don’t prepare for it.
Here’s the good news: once you answer the first five questions, you’ll be well on your way to figuring out the sixth. Let’s take a hypothetical person and create a hypothetical situation for him.
| Hypothetical Retirement | |
| Who do I want to spend my retirement with? | My grandkids |
| What do I want to spend my retirement doing? | Teaching grandkids to fish, taking them to Disney World, helping them pay for college |
| When do I want to retire? | By age 62 if possible |
| Where do I want to retire to? | To Phoenix, where my grandkids live |
| Why do I want to retire? | So I can spend time with my family while I’m healthy and active |
Once you’ve determined that you want to spend time with your grandkids, taking them to fun destinations while simultaneously helping them save for college, and that you want to start by age 62 and will need to move to Phoenix, you can begin to calculate the approximate cost of retirement. Once you know the cost, you can start determining how much you will need to earn, save, and invest before your intended retirement date.
As you can see, asking yourself the six “W” questions is a great first step to planning for retirement. Once you have a vision for retirement in your head, you can start working towards actually achieving that vision.
So when the time comes for you to start thinking about retirement, remember to ask yourself …
Who, What, When, Where, Why, and How!
You’ll be glad you did.
