Help clients set goals by 'practicing' retirement

Reframing retirement from an all-or-nothing proposition to one where people realize how much control they have lets them begin planning for it more wisely and creatively, writes Christine Fahlund, a senior financial planner and vice president with T. Rowe Price Investment Services. Fahlund, in a My Word column for the September issue of Financial Planning, says that retirees can become anxious about losing the structure and prestige of a career, and fear not having saved enough. That, and the financial and life-style uncertainties associated with retiring can contribute to clients’ being reluctant to discuss their retirement goals openly and honestly. Fahlund recommends having clients in their ‘60’s ‘practice’ retiring while they’re still gainfully employed and earning a salary. She writes: That means continuing to work, but beginning the transition by incorporating some of the activities they envision for their retirement - traveling, taking up a hobby, studying a new language or discipline. Clients who are unsure about giving up work can try out a life with a little extra leisure, without committing to it. And those who haven't saved enough can postpone retirement - ideally until 70, when they can collect their maximum Social Security benefit - while letting themselves enjoy life more. The key, she says, is that clients “don’t tap their next egg.” They should pay for their new lifestyle from earnings. Read Fahlund’s column for more smart ways to reframe your retirement and Social Security conversations with clients.