, Newburyport, MA


November 1, 2011

Stop worrying, begin to love volatility

The new normal is that every day brings a 50 percent chance of calm and a 100 percent chance of uncertainty.

For those of us in the middle ground of approaching or entering that stage of life called retirement, uncertainties were not part of our earlier plans for this time. We thought of second homes, traveling, lots of time with family. We thought that not having to work meant we had earned this time for enjoying life and experiencing general peace of mind. That was the old normal, anyway.

I have spent two decades now counseling retiree-wannabes and bone fide retirees about how to enjoy the time they have and set aside their money worries. In that time I have come to learn that some people are hard-wired to worry about money regardless of their circumstances. If you can't relax about money, my best recommendation is yoga, at least two or three times a week. It's all about breathing properly and controlling your thoughts.

I also offer some financial strategies for the hard-core worriers and for those genuinely interested in getting beyond the money stuff and living with peaceful minds.

Let's start with predictability, which is the opposite of all of the uncertainty around us now. If more predictability in your financial affairs sounds appealing, then consider a few small steps.

Operate on a budget and be clear about what expenses are essential and what expenses are discretionary. This is a money area you have control over. Married individuals have to work with their spouses.

Increase your predictable retirement income, the amount that comes in, regardless of the market, the money you cannot outlive. It will last as long as you or your spouse lives. One way to do this is to delay taking Social Security until age 70 — a strategy that may be easier than you think.

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