Retirement may seem like a far-off, intangible concept for many people, and yet, from an early age, we regularly allocate a sizeable portion of our income to fund it. Saving for retirement is expected, but it can be hard to plan for a future that is almost completely unknown—it is almost like paying a mortgage on a house you’ve never seen.
When I think back to when my wife and I bought our home, we had a laundry list of specifications: location, taxes, number of bedrooms/bathrooms, size of the kitchen, single-family home or a townhome, etc. When we found houses that met enough of our criteria, we visited each one and weighed the pros and cons until we purchased the one we loved.
I can’t say I would agree to pay for a home that I’ve never seen, and yet telling clients to save for retirement is essentially asking them to put money aside for something they’ve never experienced. Retirement can be ambiguous and unpredictable, but it is also—like buying a house—one of the most substantial investments we make in our lifetime. Shouldn’t we also have a list of criteria for how we want to live in retirement?