I’ve been planning a post about the phases of retirement for a while, but I wanted to be sure I’d spent enough time in retirement to write with credibility. In my 5th year of retirement, the time has come. At this point, I’ve moved through all of the major phases of retirement, and my life has stabilized to the point that I can write from experience.
As I was preparing to write this post, I came across an excellent TEDX talk on the topic and realized it was the best content I’ve ever seen on the topic. The video has gone viral for a reason. Yes, it’s that good.
So today, I’m sharing a TEDX talk on The 4 Phases of Retirement, with a summary of the key points and my commentary on how my experience compares to the phases of retirement presented in the talk. I’m also adding suggestions on how best to prepare for the various phases to help you achieve a great retirement (my byline).
If you’re curious about how your retirement is likely to evolve, this post is for you.
- If you’ve not yet retired, today’s is a great lesson to get you thinking about how to increase your chance of retirement success and avoid the dreaded Phase II.
- If you’re already retired, today’s post will help you figure out how to “squeeze the juice” out of retirement and join the 60% of retirees who achieve Phase IV.
The Four Phases of Retirement
How many stages of retirement are there? That depends on who you ask, as demonstrated below:
6 Stages: If you ask Investopedia, you’ll find Journey Through The 6 Stages of Retirement. It’s an interesting read, but in essence, they present the same 4 stages I’ll discuss below. Their additional 2 stages include “Pre-Retirement” (fair enough, since each of us should have a planning stage prior to retirement) and “The Big Day” (one day seems too short a time frame to truly be considered a phase).
5 Stages: If you ask the Second Wind Movement, you’ll find 5 Emotional Stages of Retirement. Again, you’ll see the four phases discussed below with the additional phase of pre-retirement.
4 Stages: If you ask Riley Moynes, you’ll see the four stages discussed below. I’ve chosen to go with this option for today’s article, since the “pre-retirement” phase is, by definition, prior to retirement. I prefer to focus on the changes that occur after you’ve retired, though I’m a huge believer in the value of retirement planning. To me, however, the bigger question of “what’s retirement really like” is best answered by using the 4-stage approach.
3 Stages: If you ask Merrill Lynch, you’ll find 3 Stages of Retirement, but I found their “Exploring, Nesting, Reflecting” phases a bit simplistic and insufficient in addressing the reality of most retirement transitions.
Riley Moynes – The Four Phases of Retirement
For today’s post, we’re going to listen to Riley Moynes, who “wrote the book” on the subject. His book, The Four Phases of Retirement: What to Expect When You’re Retiring (Amazon affiliate link) has an impressive 4.4 rating on Amazon.
More importantly, he’s the speaker in a TEDx Talk, “The 4 Phases of Retirement,” a video that’s gone viral with over 2.3 Million views and 2,000+ comments on the YouTube presentation. Below is the video, well worth 13 minutes of your time to watch (if you don’t have time, no worries – I’ll be summarizing each of the 4 phases he presents below):
My Commentary On The Four Phases of Retirement
Below, I’ll present a summary of the four phases of retirement as presented by Riley Moynes (the “quotes in italics” are taken directly from the video). In addition, I’m including my commentary, personal experience, and suggestions for “How Best To Prepare” for each of the four phases. Finally, I’ve included links to past articles that relate to each phase.
Phase I: Vacation Phase
Phase I is the initial phase experienced in retirement often referred to as the “Honeymoon Phase.” In this phase, retirement feels like a vacation. “There is no set routine.” For most people, this phase represents “their view of an ideal retirement. Freedom, Baby!” For most folks, “Phase I lasts for a year or so, then it begins to lose its muster…we begin to feel a bit bored…and we ask ourselves, “Is that all there is to retirement?”
My Commentary: Riley is spot on with his description of the first phase of retirement. I remember the joy of not having to wake up to an alarm clock, never having to deal with the commute, and celebrating the Freedom we worked so hard to earn. It’s exactly what you were hoping retirement would be. However, just like in marriage, the honeymoon doesn’t last forever. For most people, the transition to Phase II happens 12-18 months after retirement.
How Best To Prepare: Embrace your Freedom and enjoy it. You’ve earned it. Realize, however, that the honeymoon won’t last. Prepare yourself emotionally for the reality that you have not yet settled into retirement. In time, you’ll be doing some personal reflection. You’ll soon realize that there’s more to retirement than a permanent vacation, and it will take some time to work through the next few phases before you settle into your “real” retirement lifestyle.
In the introduction to my book Keys To A Successful Retirement, I wrote, “At about the one-year mark, I want you to pull this book back off your shelf.” There was a reason I wrote that sentence, and Riley captured perfectly the mental shift that takes place at that time. The honeymoon is ending and it’s time to move into the next phase of retirement.
Articles Of Interest:
- The Retirement Reality Series (my retirement journey from Week 1 to Year 4)
- Were You Nervous Before You Retired? (my tips for a new retiree)
- 100 Days To Freedom (what I was thinking 100 days before I retired)
Phase II: Lost & Loss
While everyone experiences Phase I, an interesting thing happens with Phases II and II. While some retirees struggle and “get stuck” in these phases, others can avoid them entirely (Riley cites that 10-15% of retirees skip these phases, which was also, fortunately, my experience).
Phase II is the most challenging of the phases of retirement, and a dangerous phase that some retirees struggle to get out of. Riley cites the following characteristics of Phase II:
“Phase II is when we lose The Big 5…significant losses all associated with retirement. We lose that routine…sense of identity…relationships, sense of purpose, and for some people a loss of power. We don’t see these things coming…
Phase II is also where we come face to face with The 3 D’s: Divorce, Depression and Decline, both physical and mental. The result of all of this is we can feel like we’ve been hit by a bus.”
Before we can appreciate and enjoy some of the positive aspects of phases three and four, you are going to, in phase two, feel fear, anxiety, and quite even depression. That’s just the way it is. So buckle up and get ready.”
“Fortunately, at some point most of us say to ourselves, Hey, I can’t go on like this…and when we do, we’ve turned the corner to phase three.”
My Commentary: Riley does an excellent job summarizing what Eric Weigel called “The Messy Middle” in his book Reimaging Retirement. Given that only 10-15% of retirees skip this stage, the remaining 85 – 90% find themselves dealing with Phase II. It’s an uncomfortable place to be, and can only be overcome when the retiree decides she is going to do something about it. That decision is one that each individual must make for themselves. Some never make that decision, and suffer through years of difficulty. Don’t be that person. You can move on, but it will only happen if you make an intentional decision to pursue a better life.
How Best To Prepare: The question that comes to my mind is, “What’s the difference between the 10-15% of retirees who skip Phase II and the 85-90% who don’t?” Given I was in that 10-15%, and have spent years researching and writing on the topic, I think I know the answer. The good news is that it’s within grasp for anyone preparing for retirement. The highest correlation I’ve found between retirees who have a smooth transition vs. those who struggle is the amount of time they’ve spent preparing (both financially and non-financially) before retirement. It was the primary focus of my book and a topic I’ve written about extensively. If you’re struggling in Phase II, or not yet retired, I encourage you to read my book. I’ve also included a few relevant articles below which you may find helpful. The key to avoiding Phase II is to pursue your curiosity, which we’ll discuss shortly.
Articles Of Interest:
- Shining The Light on Retirement Blindspots
- The Four Paths of Retirement
- 5 Keys To A Great Retirement
- Why 28% of Retirees Are Depressed
- The Ultimate Pre-Retirement Checklist
Phase III: Trial & Error
When someone decides they need to do something to change their life and end the struggles of Phase II, they’ve turned the corner and entered Phase III. As Riley says, “In Phase III we ask ourselves “How can I make my life meaningful again? How can I contribute?”. The answer often is to do things that you love to do and do really well.”
Riley cautions that Phase III will be a period of trial and error, and the retiree should not be disappointed with some inevitable failure. You should continue to pursue things that interest you. From the video: “I know all of this can sound bad. But it’s really important to keep trying and experimenting with different activities that will make you want to get up in the morning again.” In time, as outlined in Mike Drak’s book Retirement Heaven or Hell, you’ll find your way out of Retirement Hell and into Retirement Heaven.
My Commentary: In my experience, Phase III and IV will make up the majority of your retirement years. Even though I consider myself happy in Phase IV, I continually challenge myself to evaluate what I’m doing with my time and consider new activities that interest me (Phase III behavior). In the past, I’ve used the metaphor of picking up and putting down cards, constantly seeking to improve my hand. For me, this is one of the true joys of retirement, and all of the things I’ve discovered that have brought purpose to my retirement have come as a result of the trial & error Riley discusses as an element of Phase III. Enjoy the process, it’s fun to challenge yourself to improve your hand continually.
How Best To Prepare: Riley was a guest on this Retirement Wisdom podcast discussing the four phases of retirement and made the following statement, which highlights how important the pre-retirement planning stage is in successfully navigating the stages of retirement:
“…be thinking ahead of what are some of their strengths, what are some of the things that they love to do and to be considering ways, well before they retire, that they might be able to apply those things when they do retire. And so to be able to have kind of a network that they might have built up or to look at some possibilities in advance, I think is extremely helpful.”
I agree 100% with Riley on this one and encourage anyone who is not yet retired to dedicate as much time planning for the non-financial elements of retirement as you do the financial ones. That was the approach I used, and I jumped directly from Phase I to Phase III as a result.
Articles Of Interest:
- 7 Secrets To A Great Retirement
- Accept The Challenge
- 4 Challenges To Improve Your Retirement
- It’s Time To Get Uncomfortable
- 5 Things You Need To Know Before You Retire
Phase IV: Reinvent & Rewire
Riley uses “squeezing the juice” as his metaphor for getting the most out of retirement, and encourages folks to ask themselves some pointed questions as they seek the most from their lives. “What’s the purpose here? What’s my mission? How can I squeeze all the juice out of retirement? It’s important that we find activities that are meaningful to us and that give us a sense of accomplishment. And my experience is that it almost always involves service to others.”
On the Retirement Wisdom podcast mentioned above, Riley made the following statement about Phase IV (bold added by me):
“…only about 50 to 60% of retirees break through to Phase Four. Not everyone gets there. But those who are able to break through to Phase Four are some of the happiest, most productive, satisfied, and gratified people that I have ever met. Phase Four is when we rewire and find something new that really, really hits us and that we just squeeze all the juice out.”
The purposes you find in Phase IV will result in the recovery of “The Big 5” cited as being lost in Phase II (routine, identity, relationships, purpose and power). As Riley states, “It is magic to see. Magic.”
My Commentary: While Riley states only 50 to 60% of retirees break through to Phase IV, I’m a firm believer that it’s achievable by all of us. I support his suggestion to pursue service to others as your means to finding your way into Phase IV. The work my wife and I are doing building free dog fences through Freedom For Fido is the most fulfilling work I’ve ever done in my life, and I can testify to the “magic” Riley speaks of when someone learns how to squeeze the juice out of retirement. Our working lives were, by necessity, focused on self. Take advantage of your independence in retirement to focus on others. Based on my experience, and thousands of others, it’s your most likely path for finding your way to Phase IV.
How Best To Prepare: In my book, I encourage readers to pursue their curiosity. Listen to that inner voice, and take the first step in whatever direction it leads. If it involves service to others, listen extra closely. That approach is what led to my creation of this blog, where my focus is “Helping People Achieve A Great Retirement” (outwardly focused). The same approach led my wife to establish Freedom For Fido, where we help low-income people who are in need (outwardly focused). The pursuit of curiosity and using your time to help others is likely the greatest differentiator for the 50-60% of retirees who make their way to Phase IV versus those who don’t.
Articles Of Interest:
- Freedom For Fido – A Story of Finding Purpose In Retirement
- Why 72% of Retirees Are Happy
- 10 Ways To Find Joy In Life
- You Can Do Anything You Put Your Mind To
- The Fragility of Life
I frequently use “The Starting Line” when talking about the beginning of retirement. That’s intentional, and I use it for two reasons:
1) Too many people think of retirement as the “end”, when in reality it’s “the beginning.” I prefer to look forward and firmly believe life is better that way.
2) Retirement is like a marathon, and crossing the starting line is a very small step in a race with many phases. The use of “The Starting Line” is my way of reminding people that they have a lot of life ahead of them, and they need to decide how they’re going to run their race.
Riley’s four phases of retirement captures the reality of a retirement life better than any other content I’ve seen on the subject. If you’ve not yet retired, learn the important lessons he teaches to minimize your chance of getting stuck in Phase II. If you’re already retired, apply the lessons thousands of others have used to move yourself into Phase III and IV.
Ultimately, you are in more control of your journey through retirement than you have been in any other phase in your life. Accept the responsibility, and enjoy the process.
Squeeze The Juice.
Your Turn: If you’ve already retired, what phase are you in? What tricks have you used to avoid getting trapped in Phase II? What tips do you have to help folks reach Phase IV? If you’ve not yet retired, are you concerned about Phase II? What are you doing now to maximize your chances of reaching Phase IV? Let’s chat…