Apparently, there are stages in the process of receiving the pension. The process is not as simple as waking up one day to find a check in your mailbox. Let’s call these stages Delight, Depression, Sticker Crash, Fear, and Acceptance. If you’ve been a smart planner, you can go from stage 1 to stage 5, perhaps with an additional trip to Direct Deposit. If you have done everything right, in Acceptance, you will possibly smile and give thanks. You have maxed out your 501K and have backup investments. You already know how much you will receive each month and how long your funds will last.
However, if you are like many of us and have not been thinking too much about all this, you can go through all the stages. It’s delightful to realize that someone will actually send you a check for the rest of your life. Enjoy it! Party a little. Think about never going to work again, even if you know that will not happen. For some, depression appears too early, as they somehow feel strange. If you lose your job in Britain, they say you were fired. Getting a pension can make you feel redundant and invisible.
Sticker Clash – Can’t think of another term for the sight of that first check. For some of us, it is much smaller than we expected. First, remember that interim checks (the first few months for most people) are only about two-thirds of the actual check. Second, breathe.
Fear comes immediately after Sticker Shock if the number on that check is significantly lower than expected. Don’t get lost in fear. Immediately make a list of all your other assets and sources of income. Then if you’ve never done it before, find a trusted financial advisor right away. A good advisor can tell you how to make up for lost time and, realistically, exactly how much you can expect to make up. Remember that you are increasingly likely to work until age 70, the maximum age for Social Security. Schedule an investment tune-up and bite the bullet.
Acceptance comes differently for the team that doesn’t plan. At this stage, it is acceptance of responsibility. Acceptance of the ability to create a different future. Acceptance that all is not lost.
I am not a financial planner or financial expert, but I can offer some advice. Know your financial position now. Go online for forms and resources, NOW!
