Your Most Powerful Retirement Planning Tool

My buddy Phil is a former nuclear submariner. He recently interviewed a special forces operator and asked him to identify his favorite piece of equipment for a mission. To my surprise, given the many options at his disposal, the operator selected a map. He said with a map, you are never lost. Oh, you can definitely be going in the wrong direction, but a map allows you to navigate your way out of whatever wrong turns you have taken. Without one, finding your way is difficult, sometimes even impossible.

I love this.

Too often, as people approach retirement, they are like kayakers pitching and bucking on a stretch of river with wild rapids and then suddenly dumped into a still, peaceful lake. In keeping the kayak afloat, the paddler is overrun with managing the ongoing demands of the moment. For a working person, this looks like juggling the daily load of job responsibilities, household demands, health, and other personal obligations. Once you arrive at the peaceful, quiet lake of retirement, at first, it’s a relief, a welcome release from stress. And then what?

For many people, retirement represents the first time in their lives that they get to decide what’s next. They no longer feel pressured to fulfill the expectations of work, school, or family members. That freedom can be exhilarating, but without a bit of thought, it can feel frightening or even empty—too still, like the quiet lake.

I’ve known people who’ve filled that stillness with volunteering, starting a side hustle, and deep relationships with their family and friends. I’ve also seen folks fill the stillness with online shopping, binge-watching Real Housewives, and day drinking. In moderation, none of those activities are wrong. In excess? A rewarding life they do not make.

Now, let’s return to that chat about equipment. One of the best tools in your arsenal for rocking retirement is your map (a.k.a. your retirement plan of record). A plan of record is not your parents’ thick binder full of detailed financial spreadsheets. Instead, it’s a living document created by following an agile planning process, reflecting your unique interests and aims for your life. To establish a plan of record, you’ll need to follow a few steps.

1. Start by creating a vision for your retirement. What activities will fill your day? Where do you want to live? What do you value most?
2. Then, gather the data on your financial resources to determine what’s feasible. If you’ve dreamed big to start, you may not be able to do everything on your list. This is your chance to be creative and negotiate with yourself. If you can’t do all the travel you hoped for, can you do some? If you cannot take the extended family on a cruise around the world, can you take them to Disney World for a week?
3. Tweak your plan to make it resilient. Can your plan withstand a market downturn, major health event, or living longer than expected (lucky you!)?
4. Real go-getters can optimize their plans with more advanced strategies like mapping out tax brackets, Roth conversions, and Social Security claiming dates. Emphasis on “can.” Simply getting to a resilient plan is a great goal; optimizing it is the icing on the cake. Unfortunately, this tends to be where a lot of people try to start their planning. We make it the last step in our process, and often, it’s optional as it doesn’t always provide benefits.

Your plan is your map for a great life in retirement. Unexpected twists and turns will undoubtedly come your way as life unfolds. You may even take some wrong turns. Revisiting and adjusting your agile plan will remind you of where you want to go and what you hope to achieve with the precious gift of your life. Without it, you risk getting proverbially lost, leading to missed opportunities and perhaps regrets about what could have been.

If you’re currently in the kayaking stage, take heart. Still waters are ahead. Now, what will you do when you get there?