Douglas Goldstein: Stan Hinden is a retired Washington Post Financial Writer.
He is the author of the book called How to Retire Happy: The 12 Most Important Decisions
You Must Make Before You Retire.
I like the fact that you talk about how to retire happy because in my day job as a financial
advisor, I spend a lot of time talking about the money side of retiring, how can you afford
it, but you answer much more important questions which is how to retire happy so can you give
us the number one tool you would suggest people use?
Stan Hinden: The number one tool to retire happy I believe is something called corporation.
Sometimes I’m liking the whole business of retiring to taking a long flip overseas.
When you look a long trip overseas you would spend a lot of time preparing for the trip,
planning for it, deciding where you are going to go, what you are going to see, how you
are going to get there, etcetera, there would be a lot of preparation to do an important
trip and pretty much the same thing is true of retirement.
It is in many ways a long trip.
You might spend 20 years, 25, 30 years in retirement and in these days many people do
but because it’s going to take so much of your later life, it’s very important that
you prepare for it and you spend the time sort of doing your homework.
Let me give you one example of what I mean.
There’s a lot of talk about whether or not people can afford to retire, certainly a very
important question.
One of the best ways to work on that subject is before you retire, to prepare a retirement
budget, it doesn’t have to be the actual budget but it should be close.
What I mean by budget is you would make up to this.
One list would be the list of all of the income you could expect to have while you retired,
the second list would be a list of all of your expenses you expect to have when you
retire.
Now it’s pretty obvious I think to most that if your expenses far exceed your income,
you are in some trouble.
On the other hand if your income is better and bigger than your expenses, then you’re
probably in pretty good shape.
Douglas Goldstein: One of the things that I’ve seen is that people work for decades
and decades and so much of the right entity is based on what they did, what they woke
up to do every morning and all of a sudden they find they’re not doing that anymore.
It seems to me that’s something that could in fact make someone unhappy, what was your
experience with that?
Stan Hinden: My experience with that and through the years that I’ve been studying and working
on retirement issues, my conclusion is that before you actually put in your retirement
papers and take your last paycheck, it would be very important for a person to think carefully
about what he or she wants to do in retirement because that is going to determine whether
or not you are happy.
Now some people know exactly what they want to do.
They have been golfers all of their life, they want to play golf, they want to play
tennis, they want to do you know sports things and they missed doing or didn’t have a chance
to do when they were working and that’s fine, except that many people find that that
gets pretty old after a while, you can only really play golf for so long and tennis for
so long.
You need something that’s substantial, that’s important and important to you in order to
be happy in retirement.
There are lots of opportunities for people to find good things to do in retirement.
Volunteering of course is a standard that many people follow and finding activities
that you think are worthwhile that give you some satisfaction.
It’s very, very important and it’s important for another reason that will determine your
happiness level.
One of the things about retiring as you indicated that people miss their work, they miss their
jobs and often the reason they miss those jobs is because they were used to going to
work every day and they spend the day among the group of people who got to be friends
and people they go to know well and people they enjoyed and like being with.
When that happens, and it does happen, it even happened to me, I found that I didn’t
miss my work so much and all those deadlines, what I miss was my workplace because that’s
where I had my friends and then the newspaper office, there was often lots of fun as well
as the hard work.
Douglas Goldstein: I think what you are saying is it’s not just feeling that you are producing
as a worker every day but it’s the feeling of having other people around you which can
help someone to have a happy retirement.
Now one of the things that you also talked about in your book or some of the mistakes
that people make when they’re retiring, one of the biggest mistakes I have to tell
you that I see as a financial advisor is that people get very nervous about money and they
end up taking more risks when they retire rather than less.
What would you recommend to someone let’s say who didn’t build up enough or big enough
nest egg to retire wealthy and rich?
Stan Hinden: Well that’s going to be a problem particularly if we were talking about income
and outgo if they don’t match.
There are things that people can do.
They can literally go back to work maybe on a part time job, they can start a small business
which I knew my friends had done, they can find things to do where they can earn some
money as well as you know enjoy retirement but you are very correct and it’s very easy
for people if they haven’t been smart about saving and investing and controlling their
own income and outgo, then it can be a problem and people have to anticipate.
One of the biggest mistakes that people make is not anticipating what they may have because
they don’t think enough about money, about whether how much they will need and whether
or not they might run out of money.
Douglas Goldstein: A lot of people just rely on social security but maybe if you can put
in your reporter’s head a little bit.
When you get your social security statement they tell you that they are going to run out
of money and wont’ be able to pay you all of the money that were due.
Do you think that’s something people really need to be worried about today?
Stan Hinden: I’m an optimist when it comes to social security.
I think I understand the system and I realize that at a certain point, some of the social
security funds may be reduced to the point where social security would be able to pay
people only maybe 75% of what they are getting now, but frankly social security is such an
integral part of the economy of this country, the United States and such a huge part of
people’s lifestyle and people’s budgets that I think it’s going to be very hard
for the government or people in the government to do much you know cutting back any place
in social security.
It could happen and it could happen to a certain degree but I have a lot in the power of social
security to maintain itself and the power of the people in politics to want to maintain
it and to not want to do any cut back more than they have to.
Douglas Goldstein: How can people learn more about your ideas and about what you write
about in your book?
Stan Hinden: I would recommend my book How to Retire Happy which is now in the fourth
edition so it’s pretty up-to-date.
It can be found at most bookstores and certainly online so I think that certainly we put a
lot of effort into writing the book and certainly in updating it and I think that anybody who
wants to learn more about retirement would be advised to take a look at it.