Choosing how to run your financial race

I knew I’d run out of gas well short of the finish line at my normal pace. Finishing comfortably would mean adjusting my plan and pacing myself differently. In the end, I finished reasonably well and the race was a good experience, even if it did take me longer than normal.

It made me think of a past article I wrote comparing training for a marathon to investing for retirement. The point I was making: reaching your goal of slowing down or stopping work with enough money to last the rest of your life requires a saving program that you begin early and contribute to often.

But what if (like my recent race) you didn’t start early enough or contribute regularly enough – or both? If this applies to you, your retirement plan could be facing the same issues I was with my half marathon. All is not lost, but if we continue with the current behaviour, time might in fact work against us.

Putting in more long runs in the few days leading up to the race really didn’t provide me much benefit, even if and when I had the time or energy. In the same way, making large savings near the end of your career has limited benefits and becomes less possible if you weren’t already saving.

One option I had was to forfeit the race and run another one later in the year – when I had more time to train. This was certainly a consideration (although I was reluctant to lose the non-refundable registration fees) and it would have given me an opportunity to build up my miles. Similarly, postponing your retirement date and working longer should allow you to build up enough savings.

In the end, I chose to enter the race but set a slower pace, meaning I would be running for longer. I also walked for one minute out of every 10, which aided in recovery but extended my running time. Overall, I reduced my performance expectations in order to reach my finishing goal. In financial terms, by reducing my expenditure I had a diminished experience but still satisfied my objective.

So, what does all this mean for your financial security plan?

If you’re close to retirement but don’t feel you have sufficient savings, you still have options:

• Work longer
• Slow down by working part time
• Decrease your retirement spending and live on less
• All of the above

For people who say “I’ll never be able to afford to retire,” don’t lose hope. It may just look different than you imagined, but you’ll eventually reach the finish line.

The information provided is general in nature, and should not be relied upon as a substitute for advice in any specific situation. For specific situations, advice should be obtained from the appropriate legal, accounting, tax or other professional advisors