Want to learn more about the things you should be doing to help achieve well-being in retirement? Let's take a look at what insights you can gain from a paper prepared by the Society for Industrial and Organizational Psychology, which summarizes 20 years of research on this topic. It can serve as your checklist for the ideal circumstances for retirement.
The paper points out five categories of factors that have the potential to negatively or positively influence your financial, physical and psychological well-being in retirement:
- Individual attributes
- Pre-retirement, job-related factors
- Family-related factors
- Retirement transition factors
- Post-retirement activities
You might have control over some of these, and you won't over others. In fact, it's inevitable that most people will have some negative factors in their lives that they can't control, such as the number of dependents they have or what sort of jobs they've held. If that's the case with you, then you'll know where special care and attention might be needed to offset the negative influences.
Factors for financial well-being in retirement
Three categories included factors that contributed positively to financial well-being during retirement:
- Individual attributes: financial literacy, clarity regarding financial goals and physical health
- Retirement transition factors: financial planning and retiring to receive financial incentives
- Post-retirement activities: bridge employment
Two categories included factors that contributed negatively to financial well-being during retirement:
- Pre-retirement job-related factors: disrupted career path and unemployment.
- Family-related factors: having too many dependents and costs related to dependent care.
The report notes that individuals can improve their financial well-being by learning as much as possible about financial matters, taking care of their health (which will help keep medical bills low) and seeking paid employment during their retirement years.
Factors for physical well-being in retirement
Let's review the categories that included factors that positively contributed to health:
- Individual attributes: pre-retirement health status, healthy behaviors and habits, and financial status
- Retirement transition factors: availability of health insurance coverage
- Post-retirement activities: bridge employment
These factors negatively contributed to physical well-being during retirement:
- Pre-retirement job-related factors: jobs that are physically stressful
- Retirement transition factors: the cost of health insurance in retirement
The report notes that individuals can improve their physical well-being in retirement by adopting healthy behaviors and habits, and by engaging in physical and cognitive activities on a daily basis. Bridge employment is one win-win activity that contributes to both financial and physical health.
Factors for psychological well-being in retirement
To improve psychological well-being in retirement, focus on the following categories and their corresponding positive factors:
- Individual attributes: financial security and physical health
- Family-related factors: marital status (being married but only if your spouse is not working) and the quality of marriage
- Retirement transition factors: voluntary retirement, retirement planning, retiring to do other things and retiring to receive financial incentives
- Post-retirement activities: bridge employment, volunteer work and leisure activities
But many factors from all five categories contributed negatively to psychological well-being in retirement:
- Individual attributes: a decline in physical health
- Pre-retirement job factors: work stress, job demands, job challenges, job dissatisfaction, unemployment before retirement and a strong work-role identity
- Family-related factors: having a spouse who's still working, having many dependents and losing a partner in the retirement transition
- Retirement transition factors: retiring earlier than expected and retiring for health reasons
- Post-retirement activities: anxiety associated with maintaining social status and contacts
It's interesting that bridge employment is identified as a positive factor in all the dimensions of well-being, but that it negates the positive impact of marriage. Does this mean that both spouses should be working? Or that they should retire at the same time?
It turns out that the type of work you do is also important: work that involves teaching and sharing knowledge with the younger generation is particularly beneficial. Bridge employment that relates to a person's same career field was more beneficial than getting a job in a different career.
The report notes that individuals can improve their overall situation by planning for their retirement, coordinating retirement timing with their spouses and striving to maintain good marital quality. Actively planning bridge employment, volunteer work and social activities are particularly helpful. People who don't have control over the timing of their retirement are particularly at risk, so you may need to put some additional thought into this area if this situation seems inevitable.
Many factors mentioned here may seem obvious. For instance, well-being is strongly related to physical and financial security and social engagement, which in turn are strongly influenced by planning and awareness of the relevant factors. And while many people have a good degree of control over these aspects of their lives, some people accept negative factors without making any attempt to improve their situation.
Remember, you may not be able to control the cards you're dealt, but you can certainly play your cards to the best of your ability.
The full report contains a wealth of definition, details and discussion of the factors summarized here.