The Five Stages of Successful Retirement

  • Jim H. Lee

I'll confess that I was a probably little too young to be coaching people on their retirement back in the early 1990's. Frankly, it is remarkable that I was able to be of any help at all, given my own somewhat minimal experience with personal finance.

A popular misconception that advisors held at the time was that retirement is a singular "event" that could be completely planned for.

My perspective on retirement is now a little more nuanced. Today, I think of it as a set of stages that can take decades to complete. The early years of retirement are very different than the later years, because priorities change over time.

Here are the patterns that I'm seeing with my clients. Not everyone goes through all the stages, but the general sequence remains the same....

Reinvention (40's, 50's, and 60's)

Before formal retirement begins, there may be a period of personal reinvention or retooling. It might involve stepping away from a corporate gig to pursue a passion project, or return to school. Most notably, it involves doing something else.

One friend of mine left her successful corporate career to become a yoga instructor, which she continues to do into her early 70's. Another friend left her job as a computer programmer to become a professional acupuncturist.

In both cases, they found something that was sustainable and fulfilling. The reinvention stage can easily take two or three decades as a prelude to retirement.

Expansion (mid-50's through 60's)

After the beginning of full retirement, there is a feeling of possibility. For couples that have accumulated adequate resources, this is a great time catch up on a few things and live a little. Items on "the bucket list" get checked-off.

This is the time when people get out to see the world, develop new hobbies, spend time with friends/family, and think about getting a vacation home.

Contraction (70's)

Owning a big house or a vacation home can be fun for a while, but then it becomes... work. Some downsize to a smaller home. More often than not, they choose to live where they have grandchildren. Life is simpler.

Travel destinations become a little more local. Cruises become popular, as they are an easy way to see the world without all the hassle.

Completion (mid-70's through 80's)

In this later stage of retirement, there is an increased focus on participating in family member's milestones. Grandchildren graduate and have weddings. Significant others pass away.

Maintaining self-sufficiency is an achievable goal, however, it is something of a group effort. Professional help is increasingly sought for yardwork and house repairs. Oddly enough, some projects finally get done when spouses are not longer available to complete them.

Visiting the doctor and managing health issues are now front and center. Social networks become increasingly important to avoid a sense of isolation.

Transition (80's and 90's).

At this stage, it is about leaving a legacy, sharing memories, and tying up loose ends. Reminiscing on the past becomes a source of joy and connection. Life can become more philosophical, or less, depending upon one's state of mind.

After this transition, it's a whole different ballgame.


Retirement involves multiple steps. Sometimes it is helpful to have a little coaching to be sure you are going in the right direction.

If you would like a free review of your positioning for retirement this fall, mention The Forward View and contact me at This email address is being protected from spambots. You need JavaScript enabled to view it..

Jim Lee, CFA, CMT, CFP®
Founder, StratFI