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4 Truths About Saving for Retirement

Retirees share insights about achieving success.


Having enough money in retirement is among the top concerns for pre-retirees. It's not surprising given some of the recent headlines about retirement savings (Even $1 million may not be enough! Social Security is going broke!). But the truth is, hitting a certain number in your bank account doesn't guarantee a happy retirement.

"It's important for pre-retirees to get clear about what is most important to them in retirement," says Josh Nelson, a financial advisor and CEO/founder of Keystone Financial Services in Loveland, Colo. For some people, that may mean staying in their family home, while others might dream of traveling the world. "Once you know what emotional assets you'll need to be happy, you can dig into the financials."

In other words, money won't buy you happiness in retirement, but knowing what will make you happy—and saving enough money to make those dreams a reality—will. Having concrete goals that you are specifically saving up for can also help make putting away money more meaningful than working toward some arbitrary number.

A recent survey of more than 2,000 pre-retirees and current retirees conducted by Athene* revealed the connection between savings and happiness in retirement. Here are four good-news truths.

  1. Balance is the key to happiness.
    Both pre-retirees and retirees understand that the key to connecting emotional fulfillment and financial well-being is balance. Focusing solely on finances can leave you bankrupt emotionally. But happiness is not likely to happen without the security of being able to afford the basic necessities. In fact, study participants realized that financial planning for retirement didn't stop once they retired. They reported that they were continually prioritizing their expenditures.
  2. You can be happier living on less.
    Most retirees in the focus groups reported a willingness to tighten their belts in retirement. But even with less money and a lower standard of living, they reported a higher quality of life than they had before retirement. Over and over it was heard, "I love being retired!" Keep in mind though, while money wasn't necessarily what provided retirees with emotional fulfillment, eliminating financial worries did raise the happiness factor substantially.
  3. Happy retirees spend time doing what they love.
    Almost 75 percent of retirees reported that they were happy or very happy in retirement. That happiness was fueled by their ability to achieve the emotional considerations that were most important to them—and by having the financial ability to support those goals. They're enjoying plenty of leisure time, relaxing, and living close to and spending time with their families, including grandchildren.
  4. You can plan for happiness.
    Nearly 65 percent of pre-retirees see themselves achieving financial independence in retirement. But how you go about achieving that independence can make all the difference in the results. The Athene survey revealed that retirees who had never used a financial advisor were significantly more likely to say they would do things completely differently when it came to saving for retirement. On the other hand, retirees who did have a financial advisor were significantly more likely to say they would do things somewhat the same. Those who had variable annuities were significantly more likely to say they'd do things somewhat or exactly the same. Retirees who did not have fixed annuities or mutual funds were significantly more likely to say they'd do things completely differently, while those who did have fixed annuities or mutual funds were significantly more likely to say they would do things somewhat the same.

*Participants in this study were provided through the Harris Panel, including members of its third-party panel providers.