Over the past few months I have had countless clients speak to me about the subject of their 'next chapter' - entering what we have traditionally termed retirement - yet it's a very different version of what we know. I have done lots of research on the subject to help give substantive advice and here are some things I have learned:
1. Many people who retire continue working in some capacity. Some even start new careers and work harder than ever before. Real estate brokerage is a perfect example. Homes should accommodate this if they plan to work from home full time or part-time. My Dad was busier in retirement managing his money than when he owned and operated his business.....you need a place to do so effectively and enjoyably.
2. Most who retire assuming they will start volunteer work, don't, mostly because they cannot find the time to do the volunteering because they are so busy....
3. Most underestimate the fact that health issues will more than likely alter their plans or curtail them. Wherever you choose to live, what is the quality of healthcare and proximity to emergency care? A stroke or heart attack treated within minutes delivers significantly different recovery results than a stroke treated an hour or more later.
4. Most underestimate the cost of housing. While many have achieved zero debt on their homes, they still have to factor in the costs of real estate taxes, maintenance, and repairs. And re-decorating. And those costs with inflation.
5. Many make the mistake of focusing on the home they will live in rather than the place that home is located in. Your neighborhood, surroundings, neighbors, amenities, access, walkability, etc are as important as the home itself. How important are esthetics to you? Do you like going to the same cafe for coffee every day or do you like multiple choices? Are three good restaurants enough for you or do you want twenty? How important are cultural institutions like the theater, opera, art galleries, museums, etc?
6. Happy, healthy relationships and friendships make for happier people. Being close to these people matters. Making new friends is wonderful but not easy for some.
7. Women have to have more money in retirement: they live longer on average! And if married, it's possible they will outlive their spouse.
8. Physical activity is key to longevity: where will you work out and exercise and what sort of activities will you be able to do as you age?
9. One of the keys to healthy longevity is mental agility and stimulation. While a cottage in the middle of nowhere can sound awfully appealing, its practicality as it relates to mental stimulation can be very limited. Yes, you can do so much learning online, but learning in a group can be lots of fun, more stimulating, and infuse a social aspect to your life: are there good learning institutions in your area?
10. Do you or don't you like the heat? Many retirees are automatically attracted to warmer climates....then some discover some of those climates are unbearable. Often they deliver high levels of humidity too. Understanding your desires around climate is meaningful too. Altitude is another consideration: most are OK with it, but some are not. The beach is wonderful, but are you prone to skin conditions that suggest you should avoid excessive sun exposure?
11. Inflation must be factored in o all planning. If inflation is 2% annually, $100 will be about $164 twenty-five years from now.... real estate is a great hedge against inflation.
I know there are so many other considerations in your clients 'final years'. The wealthier your clients, the more access they will have to advancements in medicine that could extend life well beyond what is anticipated today. We are not financial advisors, but we can help ask lots of questions for them to ponder to help them with their choices.
Having a DEEP, full understanding of locations outside of your specific area of expertise is critically important these days if you have a clientele that is approaching retirement age. This will afford you the ability to guide them to agents in different parts of the country (and world) to help with this decision-making process. Some of our wealthier clients will want to divide their time between two or three areas. Professional real estate advisory can extend well beyond your local expertise when you partner up with agents in other parts of the world to provide the ULTIMATE global real estate advisory to your clientele. Pre-screened, top quality introductions save your clients time and aggravation and add real value.
Many of my smartest, wealthiest clients appear less obsessed with tax savings and more obsessed with quality-of-life. Of course, who would not want to live in an area where taxes are lower, but you know the saying: "Be careful what you wish for...." Money alone is not everything and you cannot take it with you!
