We all walked in behind Dad like we always did but then, without warning, everything changed. The first sign something was wrong was that our dog, normally hyperactive, was cowering in the corner instead of jumping all over us. Then we saw the wires were dangling from the wall where the TV and VCR used to be; the household decorations that helped make our house a home were all broken, missing or scattered in ways no kid could ever have done.
Our home had been burglarized in broad daylight. For the first time in my life, I felt a victim’s fear and distrust. Up until then, much of my life as a 12-year-old was about what I could have, what I could do, what I could be. In a sense this was my “accumulation phase.” Then I was thrust suddenly into a new world where losses mattered more than gains.
My dad called the police and then walked through the house to make sure the thieves were gone. Everything of value was gone, and life for me changed forever.
I shared this memory at a recent workshop in connection with the many things retirement can steal from retirees. Retirement can, in fact, be a thief instead of the fairytale wherein everyone lives happily ever after. As an industry, we often are so focused on the freedoms and liberties promised by retirement that the things it can rob from clients rarely make it into our conversations or fancy binders.
By ignoring those facets of retirement, we unwittingly set clients up to become potential victims, shocked by the loss of things that once made their life feel worthwhile, provided structure, social interactions, and a little sanity. But it doesn’t have to be that way. Advisors can help clients put security measures in place that benefit both their lives and your practice.
The process starts by recognizing retirement as a potential crime scene, where you have to look for clues on how likely a person will make a successful transition from work life to retired life. I didn’t recognize the first few retirement “robberies” that I came across because they were a spouse’s eyewitness accounts, which made it difficult to assess the true extent of the crime.
“Tim still checks his flight schedule every day,” said his wife. “He logs in to see where he would be flying to if he were still on the job; checks the weather; and then stares aimlessly at TV all day … I don’t know what to do with him.”
Another spouse said, “I don’t know what Ron does out there in that pole barn all day, but every morning he wakes up like he’s got somewhere to go, heads out there and doesn’t come back in until after lunch. I’ve invited him to do other things and encouraged him to call some friends or visit some old buddies at work, but he doesn’t say much and keeps to himself like never before.”
I don’t know the police code for missing persons, but identity is one of the most devastating things retirement can rob from people. Primarily because people often confuse who they are with what they do, and once the routine of a daily schedule and purpose are altered, they lose a piece of themselves that can take years to rebuild.
Sudden or unexpected retirement -- including early buyouts and company closings -- can be particularly traumatic robberies. In these situations it can feel like a family member or friend embezzled funds, which cuts deeper and stings longer.
Less severe forms of theft also occur throughout retirement. While not as extreme as having your home broken into, if someone steals something out of your car or even a tool from your trailer or garage, you may not immediately replace it, and then realize too late how important that item was.
It’s like that in retirement, too. Fading relationships in retirement, especially with former co-workers, may not seem like a major loss at first but over time, a retiree may come to realize how crucial they are to one’s overall well-being. The comfort and ease of work relationships are not easily replaced, and new ones can be hard to come by.
Unfortunately, many of these retirement “robberies” are never reported and people are left to solve them on their own. Advisors are well positioned to help retirees who are feeling guilty, lost and craving the past. We can put things in place that help prevent these retirement rip-offs, and instead replenish their lives and fortunes.
But it does take a certain type of advisor; one who recognizes the signs and can provide essential guidance. Growing up in Detroit, my parents had certain rules on where we could go and couldn’t go. There were always bad streets or neighborhoods where troubled brewed, so we weren’t able to go near them without supervision.
Similarly, advisors need to be willing to walk with clients down some dark, dimly lit alleys if they truly want them to make it safely through retirement.
Insurance is one of the strongest defenses against retirement crimes. Just as a client must pay regular premiums for protection against a loss, clients need to spend time and energy to cultivate enduring relationships both at home and in the workplace. For advisors, that means helping people avoid putting life on the back burner while they accumulate enough savings.
Methods that include encouraging clients to maintain pre-retirement date nights, inviting friends to activities away from company grounds, or taking a passion or hobby to the next level. All can be helpful in ensuring that a client’s identity is replaced with something of similar or of even greater value instead of taken away.
Advisors often use diversification to hedge portfolio risk, but it can also be used to hedge risks associated with the more personal side of retirement. By recommending clients diversify the way they use their time, develop multiple interests that can meet their needs during different seasons of retirement, and recognize their health as a top asset class or holding, clients can avoid being mugged by retirement.
By helping clients understand the role both diversification and insurance can have on their family, friends, mental health, and physical well-being, they become better positioned to recognize danger areas and take steps to avoid or minimize situations where retirement may try to hold them up.