Saving for retirement is old school – bet you never thought a financial planner would make that statement. When we use the word “retirement” images of old people sitting on rocking chairs on their front porch come to mind. But haven’t we redefined retirement? Who really retires and does nothing all day? No one I know. Even those who leave their full-time corporate careers are working part-time as consultants … or volunteering as a Board of Director member for a nonprofit organization … or traveling … or just staying busy living life.

Instead of saving for “retirement” – which can seem like years away – shift your paradigm to save for life experiences – whether you experience them in 5 years, 10 years or even 20 years from now.

Rewrite your financial plan. And if you don’t have one, create one so you can live life on your terms (unless you have an unlimited trust fund and are essentially set for life).

Here are three items to include in your revised financial plan:

1. Expand beyond the traditional “retirement” concept.

Most financial plans focus on saving for retirement at a certain age. They tend to assume you will no longer work and will have lower living expenses. The reason people focus on retirement age is because that age defines when you can start withdrawing from your retirement account. It is also the age you elect to begin receiving Social Security benefits. For those who have pension plans at work, that’s the age you begin receiving your pension.

Expand your view beyond this generic “retirement” and focus on life experiences you and your spouse/partner want. There’s no set age for this new view of retirement. Why wait until you are 65 years old? Redefine “retirement” to be a series of sabbaticals in your career life. Do you want to travel all states by the time you reach age 40? Do you want to celebrate your 50th birthday visiting the Taj Mahal? Do you want to return to school at 67 to learn how to plant an organic garden?

5 P's of Life

To help you expand your thought process, use the “5 P’s of Life” to establish life goals. The 5 P’s of Life are personal relationships | personal finance | profession | peace of mind | physical health. In each category, identify what you want to accomplish – what life experiences do you want? Then add when you want to accomplish each item. As you move forward in life, you’ll need to re-evaluate this list.

2. Save for long-term care expenses.

Long-term care expenses are really what will deplete your savings as you age. Long-term care (“LTC”) is NOT covered by Medicare and becomes necessary as we live longer. LTC includes home care (which can average $20 per HOUR), adult day care (averages $70 per day) and nursing home care (private rooms cost $239 per DAY). These cost estimates will vary depending on the quality of the facility and where you live. Keep in mind, even if you have LTC insurance, most policies become effective only if you cannot perform more than two of your activities of daily living (“ADLs”). ADLs are self-care functions such as bathing, dressing, eating, mobility, personal hygiene and toilet hygiene. It’s best to read the small print on your LTC policy to understand when your coverage becomes effective.

3. Account for income changes.

When planning for life experiences and long-term care expenses include changes in income. For example, at 65 you may decide to continue working full-time – not necessarily because you need the income but really because you thrive for the mental challenge of work. But at age 70, you may decide to work part-time at a local garden center – reducing your income by 70%. That’s a big change. But hopefully by then you followed your financial plan and are generating supplemental income through your investments.

Rewrite you financial plan to include saving for life experiences instead of the generic “retirement”. Who wants to sit on a rocker all day when you can skydive, rock climb or even scuba dive? Also, account for long-term care expenses and income changes. It’s your life, dream big AND save diligently.


Niv PersaudNiv Persaud, CFP®, CDFA™, CRPC®, is the Founder of Transition Planning & Guidance, LLC. Her firm bridges the gap between financial planning and coaching. As a Transition Consultant, she offers sage advice in all aspects of life – financial, personal and professional. Niv does not manage money and does not sell financial products. Her services include spending plan development, divorce financial review, life strategy and professional progression. Niv actively gives back to her community through her volunteer efforts. She believes in living life to the fullest by cherishing friendships, enjoying the beauty of nature and laughing often — even at herself. Her favorite quote is by Erma Bombeck, “When I stand before God at the end of my life, I would hope that I would not have a single bit of talent left and could say ‘I used everything you gave me’.”