Retirement. The act of ceasing to work, usually a decision related to aging. Right now, a whole generation of Baby Boomers is facing retirement and, as I read somewhere, “sitting on the front stoop of old age.” Ten thousand, yes that’s 10,000, of us turn 65 every day. This astonishing statistic will continue through 2030.
I’ve been working recently with a group of family business owners on successfully transitioning their companies to the next generation of leaders. One key element of successful transition is for the owner to realistically look at their own retirement in order to effectively let go and move out of the business with dignity and grace. One school of thought is that security is a key to letting go.
Personal financial security. This is a biggie. Knowing that you will have an income adequate to meet your needs in retirement is where security begins. For many Boomers, this is a challenge. Research shows that almost 60 percent are relying on Social Security for all or most of their retirement income. Some 45 percent have no retirement savings and of those who do have savings, 30 percent have stopped contributing to their accounts. In addition, 45 percent of Boomers have substantial debt. Put this together with the fact that we’re living longer, and the challenge is magnified. Getting a clear and realistic picture of your retirement income situation is the first step in letting go and preparing to move into retirement.
Security of a functional family. Successful transition of the family business from one generation to the next depends on one key word: family. In order to retire with security, the owner needs to know that the relationships of all family members involved are sound. What family messes need to be cleaned up to allow you to retire with confidence?
Security of a strong business. Letting go and moving gracefully into retirement is a lot easier when you’re leaving a strong and financially sound business behind. What do you need to do to get your business in order?
Emotional and psychological security. Gaining the emotional and psychological security to go confidently into retirement is a challenge for many Boomers. The thought of waking up with no place to go can be terrifying. The loss of identity that comes from giving up a business role is difficult. What do you need to do, on a personal level, to get yourself prepared for the psychological and emotional changes that retirement and aging will bring?
The first step in the retirement process is pre-planning — making an assessment of what ducks you need to get in a row to retire with confidence and grace. It’s never too soon to start that process toward building the security you need to assure that you will be ready when it’s time to step off of that “front stoop.”
An experienced business executive and organizational consultant, Jan Flynn teaches at the J. Whitney Bunting College of Business at Georgia College & State University.