The 6 Stages of Retirement - Stage 1

'Retirement is often viewed as an 'event' when retirement is actually both a process (requiring planning and adjustment) and a life stage (lasting for multiple years.)'Christine A. Price, Ph.D

'It's just a stage you're going through...' - how many times have well-meaning friends and family members said that to you over the course of your lifetime? And don't expect them to stop now, because, as far as retirement is concerned, there are six identified stages that most retirees go through to varying degrees. They are:

1. Pre-Retirement (the working years)

2. The Retirement Event

3. The Honeymoon Phase

4. Disenchantment

5. Reorientation

6. Routine

I'm going to take a look at each of the retirement stages in turn and identify some of the potential pitfalls associated with them. So here we go... first off, the Pre-Retirement stage, otherwise known as the working years.

This is the time when your plans and perceptions regarding retirement are formed. You're making the pension contributions and building your retirement nest egg to the best of your ability.

You've probably also started to give some thought to what you want to do with your retirement - maybe you're thinking about moving somewhere warm and sunny and you're checking out property prices in the areas that appeal to you, or you're looking at travel sites to get some ideas about a 'big trip' you want to take. Maybe you've been 'saving up' experiences for your retirement - something along the lines of 'Once I retire, I'm going to ___________' (you fill in the blank).

This phase can also include some feelings of disengagement from the workplace (increasingly so as the retirement date approaches) but, alternatively, many soon-to-be-retirees report a feeling of increased focus and energy as they work hard to 'tie up loose ends' and hand over a tidy ship to their successor.

Some of the potential pitfalls associated with this stage of retirement include:

• Not saving/investing enough money

• Neglecting, self-managing or not getting a second opinion about your investment portfolio

• Underestimating your life expectancy (Fidelity Investments has found that the chances of one member of a couple living past the age of 90 are about 50%)

• Leaving assets unprotected by not having adequate life, medical, home or long-term care insurance

• Not giving any/enough thought to the non-financial side of retirement and what you want to be, do and have when you retire

• Neglecting your health

• Not developing any hobbies or interests outside your work

• Investing more time and attention in your work than you do in your life outside work

• Not developing any friendships outside work

• Neglecting your relationships due to pressure of work (and thinking that you'll have plenty of time to repair any damage once you retire - the relationships may be damaged beyond repair once you get around to it).