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How to Rehearse or Practice for Retirement Right Now - Episode 18 Thumbnail

How to Rehearse or Practice for Retirement Right Now - Episode 18

In this episode, I talk about the difference between a retirement rehearsal and a practice retirement and how either one can be used to help you determine if you are ready for the intangibles that go into retirement. Afterall, it's not just the dollars you need to think about when it comes to retirement. 

Listen to Episode 18 Here:


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“I can’t live with her; I can’t live without her.”

We’ve all heard this line in one form or another over the years, but it becomes glaring for many when they enter retirement. Something you may not have considered is to have an actual rehearsal or practice for your retirement.

You may be financially prepared for retirement, but are you prepared for or have you considered all of the intangibles that go into it? It’s not just the dollars you need to think about when it comes to retirement. It’s also the extra hours you will now be spending with loved ones and/or your spouse. 

Today, couples age 50 and over make up the highest age group of divorcees. This could be related to poor planning. Not poor financial planning, but rather poor planning in how couples will spend their time together. 

Retirees spend more time together than they did when they had careers, work events, children to care for, or just running around doing life. After all, life is what happens when you’re making other plans, right? 

While working, you’re likely to spend around 10 hours a day, 5 days a week away from at your job and commuting to and from home. Once you retire, that’s 10 more hours per day you are now home with your spouse. And you’ll likely spend 20-30 years in retirement. 

Now, what if you could take a week-long retirement rehearsal to get a feel for what it would be like to be retired? This might be a heavy lift at the moment, but with so many people home because of the COVID-19 stay-at-home order, you could use this opportunity to have a retirement rehearsal.

How to Have a Retirement Rehearsal

You could use your vacation time or “COVID-19 time” to take a week off from work and spend that week doing what you would expect to do when you’re retired.

According to the Wall Street Journal, Americans are losing $54.2 billion of vacation pay each year. This includes employees having more unused vacation time than what their employers allow to be carried over each year and retirees not being paid out their full unused vacation benefits.  

I typically like to recommend spouses take a week or so as a trial run when they are within 2-5 years of retirement. During this week, you should do nothing. Don’t take a trip. Don’t tackle a big home improvement project. Just stay home with your spouse and do what you would do day in and day out, like you would when you are retired.

I’m sure you have big dreams for traveling, golfing or leisure activities, but those things aren’t going to take up the bulk of your time in retirement. The big things are fun to think about and easier to plan for, but there are also the intangible day-to-day interactions to think about.

How many trips are you really going to take in a year? What happens when you get sick of playing golf?

Perhaps you’ll find that you are not ready to retire after all. Maybe you are ready to retire from your current job but you also want to pursue a part-time job or a volunteer opportunity.   

What to Look at During a Retirement Rehearsal

There are two things to consider during a retirement rehearsal:

  • First, what you are spending?
  • Second, how is your attitude?

Your retirement spending

What are you spending your money on throughout the week when you’re doing nothing out of the ordinary? About 90-95% of your retirement is going to be downtime. Pay attention to your spending and use that information to modify your retirement budget. 

Perhaps you will find that you need to increase your retirement contributions or delay retirement. It’s certainly better to find that out before you retire. 

Or maybe you will find that you may spend less in retirement that you thought. In that case, you may be able to plan for more high-dollar items or even retire earlier. Wouldn’t it be nice to use a week’s worth of vacation time, that you could lose if you don’t use it, and find out you can retire 6 months earlier?

Your retirement attitude

When thinking about your attitude, do you find you are bored a lot of the time? Boredom can lead to extra spending that you might not want. 

Here's a little anecdote: Growing up, my mother used to say a “bored person is a boring person.” She was obviously trying to get us to stop bugging her, but I agree, we can usually figure something out, I hope.

If you find you are bored, you could seek out a hobby or a volunteer opportunity or ask retired friends how they pass the time. 

At any rate, take this time to try to envision how it will be for you.

Or Try a Practice Retirement

A practice retirement is bit different than a week-long retirement rehearsal. During a practice retirement you still work, but maybe you work less and begin to enjoy some of the benefits of retirement now.

The last 5 years before retirement tend to be the years with the highest retirement contributions. This is because contributions are often a percentage of income, and your income will typically, hopefully, increase throughout your career.

The first 5 years after retirement tend to be the biggest spending years. This is when retirees often plan more trips and experiences before settling down later in retirement. 

What if you could live your biggest savings years and your biggest spending years at the same time?

During the years where you are making the most money, use your vacation time, work fewer hours, cut back on retirement contributions to just enough to maximize your company match, and do the big things you would do in retirement. 

Maybe you’re not going all in on retirement; maybe you’re working longer but playing sooner.  The biggest thing here is peace of mind and having options. 

Benefits of a Practice Retirement:

  • You remove the temptation to collect Social Security as soon as you retire. Many people think of the day they retire from their job as also being the day they start collecting Social Security, but if you can delay collecting Social Security, it can pay off in the long run. Many of you have heard me speak about the 8% compound return you can receive from Social Security for every year past FRA you wait to draw, if you can wait.

  • Since you are still working, you get to keep your employer sponsored benefits like paid time off and health insurance. 

  • Since you are working longer, you will have fewer years that you need to live off of your savings.

  • You would also have more years of compounding your retirement savings, even without adding new contributions.

  • By planning trips while you are still working, you get the benefit of enjoying them while you are still in good health.

  • You can test out leisure activities you’re interested in and think about what you would really enjoy doing for the next 20-30 years.  

Whether it’s a retirement practice or rehearsal, try to use this “COVID-19 time” to find new purpose outside of your work. I hope this topic raises some awareness for you and gives you some things to consider before you get closer to your retirement years.

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