Be Your Best

Better Than Expected

By Tom Foster

Henry Ford, one of America’s most celebrated entrepreneurs and a titan of industry, had a prescient insight about retirement.

“One of the greatest discoveries a man makes, one of his great surprises, is to find he can do what he was afraid he couldn't do,” Ford said. Of course, the carmaker was referring to the ability to succeed and accomplish big things.

But Ford’s insight has great applicability to retirement, particularly the fear many people have of being unable to retire.  Only one in five workers (21 percent) is confident about having enough money for a comfortable retirement, according to a 2016 study by the Employee Benefits Retirement Institute1. Some people believe they will never be able to retire.

Financial advisors can help their clients overcome fears about the inability to retire through creating a path for them to reach their goals. Research shows that those who stay the course are more than happy they did.

MassMutual’s 2014 Hopes, Fears and Reality study2 found that 90 percent of retirees were either very satisfied or somewhat satisfied with life in retirement. And satisfaction grew the longer retirement lasted. Many, in fact, expressed sentiments that retirement was actually better than they anticipated.

There were several surprises, both positive and negative.  On the positive side, retirees were pleasantly surprised about their lack of time constraints and greater freedom (23 percent), keeping busy and active (18 percent), and time with family and friends (11 percent), according to the survey.

And what about being able to afford retirement? Forty percent said their expenses were lower in retirement than they anticipated. The longer they were retired, they said, the better they became at managing expenses.

In fairness, 17 percent pointed to financial problems as the top negative surprise. But 13 percent said they were surprised that they were too busy in retirement and 11 percent said there were no negative surprises. Well bust my buttons.

Importantly, the study showed that proper planning and reliance on a financial advisor made a positive difference.  For instance, the study surveyed retirees who had at least some savings and who had done at least some preparations for retirement. Respondents were required to have at least $50,000 in savings and investments, a modest but not insignificant sum.

There were three keys to financial security: calculating a target for how much money was needed to retire; increasing savings as much as possible; and calculating the best time to collect Social Security benefits. The earlier retirees took these steps before retiring, the more financially secure they were likely to feel.  Other important considerations: estimating medical and dental costs in retirement, including the cost of Medicare; rebalancing their investment portfolio between stocks and bonds; and creating a budget.

Advisors can and should incorporate all of these actions into the retirement planning process. Doing so can make a huge difference in helping allay clients’ fears about retirement.  Like Henry Ford, they too can accomplish what they might otherwise be afraid is out of their reach.


More from MassMutual

The Well-Adjusted Retiree

A Spiritual Take on Retirement Planning

Success Means Solving Problems




E. Thomas Foster Jr. is Assistant Vice President, Strategic Relationships, for Massachusetts Mutual Life Insurance Co. (MassMutual).

2016 Retirement Confidence Survey, Employee Benefits Research Institute,

Hopes, Fears and Reality, What workers expect in retirement and what steps help them achieve the retirement they want,

This article is for informational purposes only and should not be construed as legal, investment, and/or tax advice. Please consult your own legal counsel and other experts regarding the specific application of the information set forth herein to your own plan and/or circumstances.