Personal Finance

Are You Focused on “Return on Life”?

05_May 12_Retirement pic

Afew years ago, I was at a seminar and had the opportunity of listening to a presentation by Mitch Anthony, author of “The New Retirementality: Planning Your Life and Living Your Dreams…at Any Age You Want”. For me, it was a great presentation as it aligned completely with my thoughts and ideas around retirement.

Return on Life (ROL) is getting the best life possible with the money and resource you have! It is a simple concept that challenges the old mentality around retirement.

Retirement is not about reaching a particular age, it’s not about hitting a particular net worth target; it’s not about the excessive focus on Return on Investment (ROI). Retirement is all about change, it is a transition and it is very personal.

Of course, to retire well requires good planning and guidance. In many cases, it requires changes in habits around money, but unlike the retirement planning in our current market place that is excessively focused on ROI, reaching a certain age bracket and on your net worth, a great retirement plan should be value-based.

A value-based plan focuses on generative values across families from generation to generation. Value-based planning goes to the core of our values as humans and takes into consideration not only wealth but also intimacy, spirituality, giving and other core values that are vital to us. Moving from ROI to ROL requires this kind of planning and thinking around wealth and retirement.

This new concept of thinking about retirement caused me to reflect on my faith, my life experiences, my values and my career. It has increasingly drawn me to the need to do more, not only for myself and my family but also for my clients and the community.

As I reflect on my own struggles and those of my clients around business building and finances in general, I believe there is a lot we can learn from this new perspective on financial and retirement planning.

Retirement is very personal. Your vision for retirement will be different from mine and from those around you. So, consider what your values are using this new perspective of retirement and design a retirement plan that reflects your values.

The media and the financial planning industry have created a picture of retirement that often raises fear rather than confidence or inspiration. In fact, in recent surveys, only two out of ten people feel comfortable they can achieve their financial goals. 70% of family owned businesses never make it to the next generation, and for those that do, only half make it to the subsequent generation.

In our society today, overall contentment is low, principally because people focus too much on money, often spending it in the wrong places. Bankruptcies among seniors (ages 65 and up) is at an all-time high. And it will get worse with this Corona virus that is devastating the world economy. These are pathetic stats that give me a great deal of concern.

As you navigate this journey of financial and retirement planning, you should consider ways to increase your knowledge around money management, budgeting, investing, taxes, and side hustles to generate more income. If you have a financial advisor, ensure you’re paying close attention to your investments including returns, fees, etc. Establish a process to hold them accountable for the results from your investment portfolio.

For those without financial advisors, there are so many tools available to you. Thanks to the advancement of technology that can allow you to invest using low cost options. Online wealth management platforms such as WealthSimple and Questrade now offer resources for Canadians to invest and manage their portfolios themselves.

At the end of the day, to successfully achieve your retirement goals, concrete planning is required and massive action must follow to make the plan a reality. I am in a profession that gives me some close insights into people’s personal finances and preparedness for retirement. Based on my experience, the principal reason people fall short of meeting their retirement goals is lack of planning.

Often, we underestimate what lies ahead and the financial implications of what it takes to sustain the lifestyle we enjoy today. Just think about it for a moment, if you lose your job or source of income today, how long will it take you to go completely bankrupt? Three months? Six months? Maybe one or two years? Or perhaps you don’t even know, which simply means you don’t have a plan, it could well be less than 3 months.

We have all seen this play out before our eyes as individuals and businesses have gone bankrupt in record numbers in less than 3 months as a result of the Corona virus pandemic. Many more will follow in the coming months and years. Hopefully, we’ve all learned some lessons from this crisis that will motivate us to take our financial planning more seriously.

So, I encourage you to lean in and look for ways to increase your knowledge around this subject. I hope this article has given you a new perspective on retirement planning. As you go on your journey, I encourage you to surround yourself with people that can provide accountability, objectivity, education and meaningful ideas that will help you accomplish your goals.

Ultimately, I want to see you move from where you are today to where you want to be in the future.


The author KGreen