Let's Begin

Dear Deven,

I can’t thank you enough for listening to me yesterday and more importantly for offering to become the ‘guinea pig’ for the planning service I wish to offer. I can write a full length post expressing my gratitude, but that will be a digression. I’m skipping that step hoping that you understand.

When you dwell deeper on the service I wish to offer, you will realise that it is a very involved and highly engaging process. I don’t know of people who offer it formally, though planners have played their role since time immemorial.

What is the need to plan for retirement?

I’ll introduce you to a few of my friends.

Vinay was an ex-colleague of mine. In the midst of explosive growth in the corporate ladder, in his late 40s, he quit job, paid more attention to his passion of cycling, opened a wood-work workshop for himself and spent more time with his growing sons.

Sunil, a doctor & teacher at a medical college, in early 40s moved out of a thriving practice in a city to a small town, scaled down practice and spent more time dwelling within.

My brother Chetan at 34 opted to move out of an MNC and take up a less engaging assignment with a much smaller company. With the time he saved, he has been giving more attention to his son.

There are more people I know personally and even more, we know publicly, who have slowed down, changed course in their 30s, 40s even in their 50s. There are many others who have picked pace at around the same age. Amitabh Bachchan did that well into his 60s.

As I see it, these people retired from the course, pace and scale of their professional life. We begin with certain objective / goal post. When we reach, we change course or at least have the option to. A large majority, however, carry on with the momentum long after they’ve reached – because they’re unconscious.

Retiring from work at 60 is an obsolete norm. Firstly, because in our times, the objective of earning livelihood gets achieved in 15-20 years instead of 35 and secondly, with life expectancy reaching 80-85, there is a lot more time to be used post the working life. The need may get even more acute for our children. When you look around, you find a lot of people, who are quite miserable in the last couple of decades of their lives. That’s not because their material needs are unmet or unaffordable, but because they haven’t planned this phase of their life.

What should one plan for?

Retirement planning, in the above sense, is not about planning for adequacy of financial resources to meet basic needs. It is about becoming conscious of what your updated needs are and planning to get to them. This is a very interesting exercise – becoming conscious of updated needs. We’re all unique. By the time we’re in 40s, our journeys bring us to very different places. Few needs become redundant, few become bigger and few newer ones arise. Also priorities change significantly. There is an acute need to balance bandwidth, resources in favour of certain needs and reduce exposure/dependence on a few others. It’s like portfolio rebalancing. It does not mean that the earlier direction and decisions or priorities were wrong. It just means that we’ve grown and we need to be cognisant of that fact. Factors like quality of food, habits, upbringing of children, contribution to the society, time for introspection, etc get introduced and also assume importance. ‘Adequate financial resources’ is a necessary pre-requisite, but surely not a sufficient one. The act of rebalancing may also alter the notion of ‘how much is enough’.

Where does one begin?

• A genuine agreement with the need for planning is an excellent starting point. 
• Next up is infusing energy into the planning exercise. Energy comes in when you look forward to, in fact are impatient to get into the execution. When the next phase pulls you, there’s no need for renunciation. Think of the people I introduced above. They didn’t renounce anything at all – in fact they lightened the burden of obsolescence while retaining all that is important.
• With energy stocked up, one can begin from anywhere. Maybe by listing the three most critical priorities, maybe by painting a picture of what a dream life will be after 60, maybe by taking stock of your networth and include the non-financial assets like health, relationships, skills, hobbies, etc.

I’ve given options of starting point. You may opt to use any other starting point as well. Undirected beginning with high energy is good. My role will be to moderate and direct the thought process and planning. Sooner than later, it may get uncomfortable, tiring and even chaotic. But as long as it is energising, there’s no problem. Planning and execution are not necessarily sequential in entirety. Execution, however, is a very different ball-game.

My responsibility is to ensure that my moral compass, ideologies, likes & dislikes do not 

interfere with your planning. It is also to keep up the commitment and earnestness to the process.

The exercise is a mutually beneficial one, but we ought to not get blinded by the value it adds to the other. Both of us are in need of the exercise, but we are doing it for ourselves alone.

I’ve written this exclusively for you. Involving your wife may benefit immensely. But don’t pass it on to anyone outside of the two of you.

We will communicate over a blog so that there is a trail of communication. You can respond in the comments section. I will summarise my understanding of your comments in my reply in the next post.

Over to you.