Welcome to the second essential element in managing transition and retirement change — adaptation and the natural curve, remember the first was awareness about life-changes. It may be quite helpful to familiarise yourself with Retirement Planning: Where to start from, as it will set a foundation for retirement planning.
Adaptation is commonly used in biology. It is the “physical or behavioural characteristic of an animal that helps it to survive better in the surrounding environment.” Adaptation to transition is a process through which an individual moves from being preoccupied with transition to integrating the transition into his or her life (Scholssberg, 1981). Human beings have coping mechanisms to survive changes that happen in life. It is essential for mankind to learn to adapt to changing environment as failure to adapt may lead to failure to cope and survive. Transition and retirement require adaptation knowledge and experiences.
The natural curve dictates that changes will happen in our lives, bodies, financials and environments. For instance, looking at the body, Richard G. Stefanacci, 2022 notes that “the body changes with age” and “as cells age, they function less well”. As we grow, cognisance of this reality is essential calling for adapting to the changes in relation to what we do, what we eat, how we exercise and so forth. Therefore, any person in denial of this fact will not easily adapt and will have difficulty managing transition and retirement change.
We all require adaptation and coping awareness to recognise, accept and reconcile to the reality that things will certainly be different from the way they have been.
Let us delve into the four adaptation aspects namely: self, health, financial and social in view of transition and retirement change.
The lifestyle you lived when you were young, teenager or youth is not the same lifestyle you are living now at 40 or 50 or 60 years. It is essential to look at the life trajectory and bring out things that give you more energy and inspiration and minimise those that reduce it.
Let’s look at it from a motor sports bike perspective, if a motor sports bike is well maintained and serviced, it will give you the finest performance level, but if it’s not serviced, may be oil is old, spark plugs are old, tyres are worn out, if it was supposed to give you a speed and comfort efficiency of 90% when functioning well, it may give you 50% or less when some of those small basics are not attended to. You will notice that these are small things that limit the bike from achieving its finest performance and will create high efficiency losses.
Similarly, many of us have small things and sometimes called thieves within ourselves robbing us of physical, emotional or mental adaptation and coping energies but we do not easily notice them. For instance, look at mental; negative thinking can be a big adaptation energy robber. It can deprive you of positive energy and change your attitude negatively.
Take note that a person’s ability to access emotional, cognitive and motivational resources enhances self-adaptability. It calls for us to spend some to identify our individual specific emotional, cognitive and motivational adaptation robbers and learning how they can be minimised.
Research demonstrates that pre-retirement planning predicts post-retirement wellbeing (D.Y. Yeung, 2017). Many of us know that making healthy lifestyle decisions can help us live and enjoy a better life. But it is not easy to develop and live a healthy lifestyle. But research studies have shown that you can enhance and sustain a healthy lifestyle. Staying healthy is an accumulation of healthy habits. These habits range from healthy foods, exercise, fitness, regular medical check-up, mindfulness and so forth that can easily be carried forward into retirement. Health adaptation calls for:
- Awareness around what you do regularly as the first step to a healthy lifestyle. Check out what contributes to a healthy lifestyle and those that compromise it.
- Have a plan of small but consistent health actions. This may range from a 10-minute exercise daily or a drop of one food item from the daily menu and making it two times a week.
- Have a mechanism to track changes you are making. Peter Drucker once said, “If you can't measure it, you can't manage it.” If you don’t track and measure your progress, how will you know if there is a change or not?
- Be clear about your bigger health goal and ensure that your reason is compelling enough. Ensure your goal is clear, specific and inspiring.
- Know that change and consistent change is a process, there will be some failures but keep moving forward. You will come to realise that what originally looked quite hard will start to be achieved as you routinely do it. Click here for more tips
Why financial adaption? To understand what you need to do to thrive in changing financial times specifically, in transit to retirement. Prudence requires that you anticipate possibility of decrease in income and major changes in expenses. The decrease in income will most likely arise because you are no longer working as you have reached mandatory retirement age or lost a job through restructuring, closure of business among other causes. In a survey conducted by The Harris Poll (2021), “42% said their biggest concern was outliving their retirement savings and investments.” This is such a high percentage of people likely to be financially insecure in retirement.
In terms of major changes in expenses, there is need to foresee expenses likely to happen in transition or in retirement. Finding yourself with expenses that were least anticipated may significantly affect your financial resource base but one of the common expenses that normally increase is the medical bills.
It can be deduced that reduced income coupled with major changes in some of the critical expenditure areas can be a source of financial stress and therefore financial adaptation awareness and action is required.
Dealing with the reality that incomes can reduce and expenses can escalate calls for the following:
Firstly, be aware that this situation can occur, so that when it occurs you are prepared but if it does not occur, you lose nothing.
Secondly, gradually set up some form of emergency fund. The amount to save for emergency fund varies depending on your actual living expenses, but the rule of thumb is to progressively save three to six months of actual living expenses. Let’s face it, we all know this can happen, but nobody knows when and the form it can take, but whatever the case, the one with some form of emergency fund will use it to stabilise as some alternatives are being sought.
Thirdly, it may be a good idea to make a comparison of your finances now to an imaginary period when you potentially have no regular employment income. This may be a wakeup call to determine how much effort and energy you need to put in now. Think about what you must pay as expenses like utilities, food, transport etc and how you would go about them in the absence of your formal monthly pay.
Fourthly, take advantage of the power of compounding illustrated in the John, James and Jordan scenario where John started to save and invest at age 25, while James got interested in saving and investing at age 35, meanwhile Jordon was convinced to save and invest at age 45. The major differences in their saving and investment are only due to time and power of compounding.
When you familiarise with some of the above aspects, you will build resilience to cope with financial transition and retirement change but will cause you to explore alternative sources of income.
Psychology Dictionary defines social adaptation as “the adjustment to the demands, restrictions and morals of society where we all live in harmony.” It is the individual’s ability to conform with norms, values and behaviours of society.
For anyone to fit in society, one needs to:
- Individually adapt to society norms, expectations and values
- Adjust to favourable and unfavourable situations in the environment
- Learn how to deal with the favourable and unfavourable conditions.
How an individual socially prepares and responds will affect how they will adapt.
It is recommended that individuals need help to boost their adaptive capacity ranging from information sharing, how to deal with obstacles, dealing with behavioural biases, clarity of individual role and purpose socially. It calls for some investment in learning how to socially adapt.
As we grow as individuals, we meet and face a wide range of changes that happen in our life’s journey. Transition and retirement readiness become a great topic of attention suggestive of planning, preparation and adjustments with unique opportunities and challenges.
Insights into transition and retirement adaptation through self, health, financial and social dimensions position individuals to boost their adaptive capacities. With increased awareness and anticipatory view of transition and retirement change, targeted actions and interventions will be undertaken.
Watch out for 3rd element life-long preparedness and learning in managing transition and retirement change.