Our relationship to money in retirement 2

Retirement Stats, Studies, and Stuff

By Mariella Vigneux, MBA, ACC
Certified Professional Coach

Anxiety about money in retirement is pretty intense for a lot of people, even those with a secure future.  We know we’re going to live longer than our parents’ generation, so we have to stretch our savings over more years of retirement.  Yet most haven’t saved enough, as reported in a 2014 study on retirement readiness by the Conference Board of Canada:

• 60 per cent of survey respondents have not saved enough for retirement.
• Over one-third of Canadians say they don’t know when they’ll be able to retire.

We hear startling statistics about unexpected early retirement due to bad health.  For example, a June 2015 report by the Ontario Securities Commission reported the following:

 “Among retired persons under age 75, 35% reported that they were forced to retire earlier than they wanted. For two-thirds of this group, health reasons led to early retirement.”

Defined-benefit pensions, which give you a pre-determined income at retirement, are fading into the sunset.  More people are carrying higher levels of debt into retirement than they anticipated.  Many are working longer than they intended and one-third of those surveyed are uncertain when they will retire completely.  Nineteen per cent say they will never retire.

Retirement can bring a good deal of anxiety about money.

The energy of money

It’s somewhat reassuring to realize that, no matter what our financial picture, we’re not alone in our worrying; the wealthy and less wealthy lie awake worrying at night.  We all have to come to terms with our money reality at some point.  The trick is to understand our individual relationship to money.  How does it serve us?  In what other ways do we measure richness? How does it factor into our definition of success?

American mythologist Joseph Campbell describes money as energy:

“Money is congealed energy, and releasing it releases life’s possibilities.”

Does having money make us rich?  To be rich means to have an abundance of what we need or want.  Yet, Helen Keller, blind, deaf, and mute from the age of two, would tell you…

 “The best and most beautiful things in the world cannot be seen or even touched.  They must be felt with the heart.”

Does money lead to happiness?  Martin Seligman, American psychologist, educator, and author says,

The most profound sense of happiness is experienced through the meaningful life, achieved if one exercises one’s unique strengths and virtues in a purpose greater than one’s own immediate goals.

What about success?  Is money the measure of success?  I rather like theologian Ralph Waldo Emerson’s description of success, which doesn’t mention money once:

To laugh often and much;
To win the respect of intelligent people and the affection of children;
To earn the appreciation of honest critics and endure the betrayal of false friends;
To appreciate beauty,
To find the best in others,
To leave the world a bit better, whether by a healthy child, a garden patch or a redeemed social condition;
To know even one life has breathed easier because you have lived.
This is to have succeeded.

Your Money Autobiography

Maria Nemeth, author of The Energy of Money, offers a useful exercise called Your Money Autobiography.  The exercise consists of 20 questions, which I found very revealing.  She says,

“Your experience with money’s energy began when you were very young, and it has shaped the way you handle money today.  When do you remember first hearing about money?  Who was it from?  What was the emotional climate like at that time? When did you first earn money? When did you lose it?  The answers to these and other questions will give you a clear picture of the associations you bring to any discussion of your personal finances, goals, and dreams.”

In answering the 20 questions, I realized that I have a recovering Catholic’s attitude towards money:  I am responsible with it, I’m a good girl, but joy does not abound in my relationship to money.   And, although I hold myself responsible for how I make my way in the world, I can see how my upbringing influenced my relationship to money.  My parents valued good education, good dental health, and good education.  Now, so do I.  My parents also regularly looked for ways to cut expenses.  One year they decided we wouldn’t receive birthday presents.  They taught us to turn off unused lights.  Being the seventh daughter, I received a lot of hand-me-down clothes.  They cut our real milk with powdered milk, so they could donate 10% of their income to the church.  Dad worked out a deal with the local grocer, which meant he brought home ‘used’ vegetables from the grocery store each week.  We were masters of thriftiness.  But, heck, what can you expect in a family with ten kids?

The value of looking at our money autobiography is to understand how our relationship to money is rooted in the past and to see its influence on our current decisions in life.  Once we see that, we can become masters of our decisions.

Three views: scarcity, abundance, or neutral

How we view money is individual.  However, I figure there are three types of people, when it comes to money. There are those who see a scarcity of money, those who see an abundance of money, and those who are neutral on the subject.

I’m in the scarcity camp.  I worry.  My conversation is peppered with talk of prices.  You’ll hear my sharp inhalations of breath when extravagant purchases are made.  And I’m always on the lookout for bargains.

My husband Mark doesn’t worry about money.  Although the unlikely prospect of not having enough money for our needs would be worrisome, he generally sees our needs as minimal, and isn’t excited by dreams of having an excess of money.  He’s neutral in relation to money.  I find it a comfort.

I know a business woman who says that she draws money to her.  She is self-employed and making a very good income.  Another woman I know says that when money is tight she knows she just has to go out and work some more and she’ll be fine.  These two women are definitely in the abundance camp, always trusting that money will be available.

For people in all camps of thought, though, there comes a time when we need to decide when enough is enough.  And it would be a great pity if we worked to earn money at the expense of being able to enjoy it.

My thimbleful of learning

What I’ve learned about my own relationship to money could fit in a thimble, but this learning has been hard won.  I’ve come to view money as simply a temporary vehicle that translates visions into reality.  It flows like energy and it connects people.

I now enjoy spending money – if I like the person I’m giving my money to or when I believe in the values of the organization I’m purchasing from.  I worry less about money, as I’ve come to define richness in broader, more real, terms; much of what I prize – love, time, solitude, beauty, dance, health, humour, conversation, change, friendship, learning, adventure – doesn’t cost me much, if anything, at this point in my life.  I’ve never been destitute, and the time Mark and I had the least money – as students, returning milk bottles for cash, searching the couch for change, and placing empty jugs in the toilet water tank to save water on each flush – was a time of great happiness.

“To be without some of the things you want is an indispensable part of happiness.”

 ~ Bertrand Russell, philosopher, mathematician, author, Nobel laureate (1872-1970)

The burden of worry

I know.  We need money.  Money enhances our lives.  If we didn’t have money, we’d be in trouble.  If we had more money we could take better care of those we love and we could do more things we’ve always dreamed of doing.

It’s easy to become worried about money when contemplating retirement.  It can be a scary business.  What’s harder is to accept that our income does not determine how rich we are, how happy we are, or how truly successful we are.

Worrying about money is a burden.  Maybe instead of being anxious, we should acknowledge how much money is enough and work towards that goal in a practical, unemotional way.  We can put our emotional energy into planning ways of enriching our lives outside of money – fun and meaningful ways, ways that do make us rich, happy, and successful.

Self-coaching questions

Aside from money and the things that money brought you, in what ways are you rich?

What in your past life shaped your attitude toward money?  (From whom did you learn about money?  What was the emotional climate like around that time?  When did you first make money?  When did you first lose money?  What worked well for you in your money life?)

What positive things might happen as a result of your income stopping?  (This is an almost bizarre thought… but, hell, we don’t need any help thinking of the negatives!)