In What The Happiest Retirees Know, author Wes Moss highlights 10 attributes that can help you be a HROB – Happiest Retiree On the Block – and not an UROB, or Unhappiest Retiree on the Block.

He writes that data from the Financial Planning Association south of the border found that “only 18 per cent of U.S. households have enough wealth to cover pre-retirement consumption when they retire, meaning most Americans will not be able to maintain their pre-retirement lifestyle in retirement.”

As well, only half of U.S. citizens are even saving for retirement, writes Moss. “Very few people are prepared for the full retirement journey, and many don’t think they will ever be able to quit working,” he explains.

Here are the 10 habits that form the core of this humorous and well-written book.

Excellent money habits — $500K in savings

He writes that the happiest retirees “have $500,000 or more in savings, their mortgage payoff is complete (or at least in sight) and they have multiple streams of income.”

While $500,000 sounds like a lot of money, it is an attainable goal if you start young, he writes. He recommends that people save 20 per cent of their pre-retirement income.

“If you simply take $100 each month and invest it, assuming a 10 per cent return and that your investment compounds monthly, you’ll have a sweet $637,000 at the end of those four decades,” he writes. If 10 per cent returns seem high, Moss notes that the U.S. S&P index has averaged over seven per cent a year for the last 20 years.

Having more than one stream of income is key as well, he writes. For retirees, this could include “multiple pensions, (government retirement benefits), rental properties, investments, or part-time work.”

It’s essential to know in advance what your post-retirement income and expenses will be, so that that you can find, and fill, any gap between what’s coming in and what’s going out.

Curious and adventurous – at least three core pursuits

Moss writes that the happiest retirees have “3.6 core pursuits…. The unhappiest retirees only have 1.9.”

“Most of the core pursuits fell into four categories. There was part-time work, like teaching, consulting, and decorating. Then there was exercise and health – activities that included hiking, biking, swimming, walking and cooking. The arts were a big one, with painting, pottery, and music topping the list. And then there was adventure, such as travel, cruising, RVing, piloting and sailing.”

His list of Top 100 Core Pursuits includes yoga, tennis, golf, knitting, pickleball, skiing, joining social clubs, and much more.

Live close to independent kids who have their own homes

Moss writes that the happiest retirees live near their kids or grandkids, no more than two or three hours away.

He stresses, however, that the kids need to be independent – living away from home and on their own, without a lot of parental support. “Retirees were two times unhappier if their adult children still lived at home,” he writes. As well, “unhappy families average $714 a month in support of their 20-, 30, and 40-something-old `kids.’” The happier retirees spend less than $500 a month of their kids, he continues.

Times are tough these days, he concedes. As of September 2020, 52 per cent of young adults in the U.S. were “living with their parents… it’s the highest percentage since the Great Depression. No wonder parents are depressed.”

“If your children are not financially independent, you are 1.5 times more likely to be an unhappy retiree,” he warns.

They are married, and have either never been divorced, or divorced once

His research found that retirees who have never married, or have been divorced two or more times, are less happy in retirement than married couples where each partner has either never been divorced — or divorced only once.

You only get one do-over in marriage, Moss concludes.

They stay connected

Moss notes that the happiest among the retired are those with “at least three close connections/friendships.” Friends, he writes, “are a better happiness currency than money. You heard me correctly. Money can’t buy friends – but friends can buy happiness.”

You should see friends every month and belong to at least one group. An ideal way to merge the two concepts is to travel with friends.

They are healthy

“Happy retirees are fans on the `ings,’” he writes. This means “walking, swimming, biking, and hiking.” They “gravitate toward a healthy diet,” and enjoy a drink – particularly “white wine and gin.”

They have good home habits

“Happy retirees live in nice houses, but not McMansions,” Moss notes. “It’s OK to be comfortable. It’s less OK to have exotic zebras grazing on the 400-acre ecofarm you call home.”

They also tend to stay in the same neighbourhood, and “don’t downsize… this is a new habit gleaned from my most recent study. (They) don’t downsize into a smaller place, mainly because they anticipate their kids and grandkids will be coming home to visit.”

They also focus on paying off their mortgages first, not last. “It’s a surefire thing. Once that prodigious debt is off your shoulders, no one gets to take a four per cent bite out of your joy,” Moss notes.

They exhibit excellent investor behaviour

Moss writes that the happiest retirees invest more in stocks that pay dividends than bonds, and avoid trying to time the market and avoid short-term risks by taking a long view on investing. Their investment decisions are not “based on emotion… they are not fueled by fear. They take time to take stock (pun totally intended.”

They are, he says, careful when turning investments into retirement income, and on making sure they don’t run out of money in retirement through adherence to the “four per cent rule” on annual withdrawals.

They are masters of the middle

Happy retirees, Moss writes, are “smart spenders. Sure they may have had times in their lives when they were carrying a little too much credit card debt or struggling financially, But for the most part, they’ve prioritized saving over spending – and they don’t deprive themselves needlessly.”

The UROB (unhappy retirees) have a few characteristics as well, he writes, such as “the obsessing over money thing” and placing too much emphasis on status – a big house and a flashy car.

This is a different way to look at the whole retirement picture. We recommend that you find a place for this book in your retirement library.

If you are saving for retirement, as the book suggests, putting away a set percentage of your paycheque towards retirement is a smart way to pay your future self first.

The Saskatchewan Pension Plan allows you to make pre-authorized contributions from your bank account. Alternatively, you can set up SPP as a bill in your online banking app and set up automatic, monthly SPP “bill” payments. The difference is that this will be a bill that pays you back.

Check out SPP today! And, in breaking news, SPP’s Variable Benefit is now available coast-to-coast-to-coast for all SPP members!

Join the Wealthcare Revolution – follow SPP on Facebook!

By Sheryl Smolkin

This month’s interview is with author and financial journalist Jonathan Chevreau. Jon was the Financial Post’s personal finance columnists for nineteen years, and subsequently the Editor in Chief of MoneySense Magazine for two years until he declared his personal “financial independence day” on May 20th, 2014.

He has relinquished the leadership role at MoneySense, but as editor-at-large, his work is still frequently featured. He also writes for many other online venues and in November of last year he launched his ambitious North American portal, The Financial Independence Hub.

I last interviewed Jon for savewithspp.com in the summer of 2012 about his financial novel Findependence Day. Today I’d like to explore what he describes as “the profound difference between the traditional concept of retirement and the paradigm shift he calls financial independence.”

Q. To start off Jon, what is the difference between financial independence or “findependence” and retirement?
A: Well Sheryl, I always say that when you’re findependent you’re working because you want to not because you have to, financially speaking. But of course the lines blur. For the media and the financial service industry, it’s retirement, retirement, retirement. They don’t really distinguish between the two concepts.

For super frugal people, financial independence can often occur decades before traditional retirement. When you talk about the “early retirement extreme” movement, what these people are really talking about is being financially independent.

Q: So in fact you have coined the term findependence to apply to people at various ages, not just older workers?
A: Yes. The Financial Independence Hub is relevant for people at all stages of life.

Q: You’ve left the corporate world. But you seem to be busier than ever, with all of your freelance writing, your blog, and spin-offs from your book Findependence Day. How would you describe your current status?
A: Busier than I want to be, really. I think you can relate to that one as well. On the Hub I reviewed books like Encore and I talk about this new phase of life. If you believe in extended longevity and a lot of people leave corporations, either voluntarily or involuntarily, in their late fifties, early sixties, I say there’s a fifteen to twenty year sweet spot.

You’re no longer an employee, but I don’t think you are ready to take year-long cruises and do nothing but watch TV, play golf, read and play internet bridge. I think that fifteen year period, is the new “encore stage.” You could also call it part-time or phased retirement.

Q: How many hours a week do you estimate you’re currently working for compensation and on your own projects?
A: I got into this in December (2014). I read a bunch of internet books. I was keen on “Multiple Streams of Internet Income” by Robert Allen, and a book by Tim Ferriss called “The Four-hour Work Week.” I decided by having more passive income and less renting my time out, I could go to a four-hour week. Unfortunately, it hasn’t really worked out.

It turns out that the path to a four-hour workweek for me is a nine-hour day. I would say that I probably still spend 40% of my time on the MoneySense blogging contract. Another 40% is spent on the Hub which is not billable time. About 20% of my time is taken up with other things like one-off speeches, book sales, blogs and articles.

Q: What are the pros and cons in your view of your current working arrangement, as compared to working as a full-time salaried journalist?
A: As a freelance contractor there are no employee benefits, sick days or paid vacations. I had a “man cold” last week and I had to barrel through it. Luckily, of course, I don’t have to commute.

It’s hard to match my previous gross income but it can be a little bit better on an after- tax basis depending on the legitimate employment expenses I can write off. When I balance it with the lack of commuting, I think it’s a better life-work balance. But like anything else, there are trade-offs.

Q: Do you think that Canadians across the board are working longer and contemplating encore careers, or is this really restricted to knowledge workers and entrepreneurs?
A: Well I think that’s an apt observation. When you’re a knowledge worker there’s a real blurry line between working and playing, because I think we actually find it quite fun to absorb lots of information on subjects that fascinate us. Whereas, as you point out if you are a labourer, the body is not as apt to keep on going past sixty-four or sixty-six.

Q: Youth unemployment is running around 14 %. Are older workers, who continue working, clogging up the pipeline for young people and mid-career workers who are trying to get a leg up on the employment ladder?
A: Well that is one perception I’m not sure is true. I suppose if we’re talking about a big corporation with your traditional pyramid, where basically there are only a couple of people at the top, then yes, older workers might be clogging up that traditional pipeline.

But I think when you’re talking about all the people leaving companies and then contracting back their services, at that point they just become a valuable asset. Younger people can still move up the ladder, and they can still access the expertise and skills of the older codgers, like me if they are retained as freelance suppliers to the company.

Q: Some people opt to work longer for their current employers or continue on a contractual basis. Then there are others who want more flexibility or to try something new. How can older workers go about finding an encore career?
A: They can go to findependencehub.com and check out the book reviews. Encore, the Big Shift, there are tons of these books out there. For some it might be going back to school, getting an MBA. A lot of people make complete changes. For example, Eleanor Clitheroe left Ontario Hydro and went to divinity school.

I have a friend who is actually downsizing and moving to the country, so that he can go from being a set designer to doing true art. Every second journalist I know wants to write the great Canadian or American novel. I compromised by writing Findependence Day which is a financial novel.

Q: Money won’t buy happiness but it helps. What are some of the factors that you think contribute to a happy retirement, other than having enough money?
A: There are obvious things.  Health, happiness, relationships, family, networks. There’s a book by Wes Moss called “You can retire sooner than you think.” One of the things he talks about is a retiree should have at least three or four passionate interests. This is why I decided to put internet bridge back on my list. Reading, volunteering and exercising would be others.

I think the biggest single thing is of course your partner. I’ve talked to people in the financial service industry, who’ve been divorced. They say the biggest mistake they ever made financially-speaking was to get a divorce, because their net worth was cut in two right off the bat. But obviously you don’t stay together for financial reasons if you don’t have a harmonious relationship. 

Q: Well the relationship issue is interesting and I think one of the things that I think about all the time, is you don’t know how much time you’re going to have. You’re worried about financing thirty years of retirement but who knows if you’ll have it. So if you put it off and you put it off you just might miss those golden years.

A: Various people have joked that financial planning would be the easiest thing to do on Earth if you just knew when you were going to die. Unfortunately, most people don’t.

Q: How long do you think you will continue to work?  Do you see full retirement any time in your future?
A: I have a vision, that eventually I will have a website that brings in lots of passive streams of income. My idea of a nice retirement or findependence is every three years, to leisurely write a book working four six-hour days a week. Then I would go on tour to promote it and bring in another stream of income. Instead of grinding out words for multiple clients I’d like to be financially independent enough to work on one big project.

Q: Thanks very much for talking to me, Jon. It’s always fascinating to talk to you.
A: Well thank you for allowing me to share some of my thoughts, Sheryl. I think you’re doing a great job, too, on Retirement Redux.

—-

This is an edited transcript of a podcast interview of Jonathan Chevreau conducted by telephone in March 2015.