January 2013

Perspectives from Anna - Some insights Into Phased Retirement and Retirement Decisions from the Retiree's Point of View

By Anna M. Rappaport

This column was motivated by my recent work in updating my website (annarappaport.com), and thinking about it, and by a session at the 2012 Society of Actuaries annual meeting focused on retirement decisions. We were very fortunate to have Paula Hogan, a leading financial planner, as a guest presenter. Paula was very interested in the ideas around life portfolio and managing our lives in retirement and wrote about them (click here to read). It was further motivated by the fact that I am just starting on a project of which phased retirement is an important part.

Since retiring from Mercer at the end of 2004, I have given a lot of thought to managing retirement and have been an active phased retiree. Many people have focused on managing income and assets. This article focuses on a different aspect of managing retirement: managing life beyond money. (It assumes that financial management is under control and that there are adequate financial resources.)

Building and maintaining a life portfolio: From my perspective each of us should have a life portfolio as well as a financial portfolio. Just as the financial portfolio requires focus and management, so does the life portfolio. However, the strategies that make sense for the life portfolio are very individual, and there are few established guidelines for defining and managing a life portfolio. Some of the observations about my decisions and life portfolio are as follows:

  • I view myself as a phased retiree. I have stayed very active professionally and hope to continue to do so.
  • I seek consulting assignments consistent with my interests.
  • Volunteering in areas that I view as important is a good way to give back while at the same time doing something that I enjoy.
  • Research, writing and speaking are all a big part of what I do.
  • I am also an artist and have worked to balance actuarial and retirement system focus with art.
  • I place a high value on family commitments and do not get involved in projects that will create difficulty with other priorities. This is a choice that someone with a regular job often can’t make.
  • I work regularly to maintain contacts.
  • I only undertake projects that are of interest to me, and which I can do on my own without staff. I may partner with others and have others help me.
  • Advisory group roles can fit well into what I want to do.
  • I am creative, and seek to apply my creativity in both professional work and art. In my art, I have focused on several areas of innovation. My website describes what I have been doing.
  • I want to feel that what I do has value.

As we age, we may become limited in what we can do. Ideally, the life portfolio has some flexibility to adjust to limitations. I think it is important to include some elements in a life portfolio that can be continued even if one is physically limited or significantly involved in caring for others. That will mean that a physical limitation or care giving responsibilities will not require one to give up the entire portfolio.

Some people will work on building a life portfolio long before they retire, and others will not start until after they have retired. My view is that it is better to start on this before retirement and to have some pieces of a life portfolio in place, or ready to be put in place quickly. A friend who is now doing significant volunteer work for the Society of Actuaries observed that getting elected to the Pension Section Council two years before retirement opened up a new world to her, and helped her build her portfolio. While I strongly support thinking ahead and building a portfolio over time, it is also important to maintain flexibility and not get committed to too much.

Building a brand and using it: It is important to define what you want to do and to be selective about what you decide to take on. Think about what you want to be identified with and what you want people to ask you to do. Today many people are aware of the need to build a brand earlier in life, and to use it to manage a career. That need does not go away for a phased retiree. In fact, since there are no well formed expectations about what a phased retiree might do and how such a person fits in, the need tends to intensify.

I participated in a panel on Women’s Leadership this summer and I commented that it is also important to remember that appearance is a part of branding. Women particularly can be remembered because of what they know or because of how they look or both. My view is that it is desirable to dress and maintain an appearance that supports one’s professional goals and is not a distraction. However, as a phased retiree, I feel I have more freedom to make personally appealing choices with regard to jewelry, colors, etc. However, if my goals were to get appointed to corporate boards—a goal often held by phased retirees—then it would be extremely important to dress that part and maintain an image that would make people comfortable with me in that role.

Part of using your brand is communicating it. After retiring from Mercer at the end of 2004, I established Anna Rappaport Consulting in 2005. Once I did this, I developed a brochure and shared it with many people to let them know what I was doing. Regardless of whether one has a paper brochure, I think it is important to have a focused and brief statement about who you are and what your goals are. I also developed a website and this is discussed below.

Use of technology/website: Technology has been critical to my life portfolio choices. The professional work I do can be largely done from any location online and by telephone. Access to a good computer and printer is key. One of the things I no longer have is “tech support” from my employer. I still need support and it has been invaluable to find a local person who can come to my house and help when I have a problem or need something set up. An early step in making phased or full retirement work can include upgrading technology—including telephones, internet service, computers, printers, etc.

An important part of telling my story has been to have a website. The website was first developed in 2005 and it has just been updated. The development work also helped me to define my story better. For those interested, the website is annarappaport.com. This link was also placed on brochures and business cards. The brochures were extremely helpful in the first three years to tell people about what I am doing.

I have spoken to other phased retirees who do not have websites and feel that they do not need them. I felt that I needed a website if I was to be viewed as a credible speaker and advocate. Even if someone knows me, I feel that they need the website if they want to tell their boss about me with credibility. I do not believe the website attracts people to me, but it is a reference point for people who hear my name. The topic of when one needs websites would be a worthwhile discussion topic.

There has been a great deal of discussion recently about the use of technology and social media. LinkedIn has been very valuable to me in locating people with whom I had lost touch. Overall, this is an area where I still have a lot to learn, and my use of social media is somewhat limited. I have tried posting ideas and questions to various group sites on LinkedIn to see if we could get discussions started—but without too much luck to date. I have to decide how much effort I will put into building more skills in the formal social networking area. However, I have spent a lot of effort building the website. Another good discussion topic would be the best balance of the use of personal resources between building websites and various social media.

Others thinking about this may be interested to know that I used professional help both in formulating the story and in implementing the website, and for me, that help was critical. This exercise forced me to think about what I want to do and what I do not want to do. It also encouraged me to identify good examples of my work and decide which to show to others. In the recent revision of my website, I decided to do several things beyond merely updating:

  • Incorporate an improved design.
  • Group all of the presentations into the three topic areas where I am the most active. Select a few slides to show how ideas are presented in the slides.
  • Change the balance between art and actuarial work, display more art and talk about what I have been doing.
  • Add a blog. I hope to be able to keep it up pretty well, even in the absence of voluminous feedback.

Securing opportunities: Opportunities can be found in many areas—think about the life portfolio. One never knows what opportunities will come along. Opportunities most often happen because of seeds that have been planted along the way. As a phased retiree, I have learned that there are many pro bono roles available, that they can be very gratifying and that people appreciate good work. It is much more challenging to get paid consulting work, and more difficult than most people think it will be. For any individual, I believe there is also an issue of deciding what one is professionally qualified to do, can manage independently and what one wants to do. This answer will differ for each individual. I encourage people to be realistic as they think about these trade-offs and constraints.

My strategies for keeping my story in front of people include maintaining contacts, participating in committees and panels, seeing people, a website, limited use of social media, and periodic update letters. I keep up with people and when I am traveling I try to connect with people beyond the meeting I am attending. On a number of occasions, I have organized a dutch treat dinner with a small group. The dinners have been a great success. I also attend a few face-to-face meetings each year.

I do something else to tell my story: Every year or two I have sent out a paper letter to more than 200 contacts updating them on what I have been doing. While this seems very old fashioned, I get many compliments on the letters. Because few people do this today, I think they stand out and help people to remember that I am available and professionally active.

Measuring life portfolio success: As a phased retiree, my life is very focused on meeting my personal goals. A simple way of deciding if things are working out is to periodically (at least once a year), think about what one has been doing. If you are doing things that you are happy about and proud of, then I would call that a success. On the other hand, if you do not have a story about accomplishments that you feel are worthwhile, then it may be time to rethink your goals and strategies.

Sometimes we get derailed from doing what we want to do because of the needs of family members who need care and support. From my perspective, that is also important and a good reason to put some of the other life portfolio issues on hold.

Other observations: I have tried to avoid overhead so that I am not under pressure to earn a minimum consulting income just to support the overhead. I do not have employees, an outside office or billable hours goals.

Some support is essential to me. That includes a local tech support person who comes to the house, website support, someone who can help with editing and making PowerPoint presentations look nice, and peers who are available to review articles. Family members and friends have been critical to my solutions to these challenges.

Time management during phased retirement is entirely different than while one is working, but is just as important. This requires new skills, discipline, the ability to set priorities, and insight into when it is best (or possible) to say no. With regular employment, one usually has a defined structure to the week. As a retiree involved in different activities, every day may be different, but there are still commitments that require adhering to schedules. One has many options about what to do and can get many requests for help and it is important to be able to choose. It is also important to be able to decide how much time to spend on a project before moving on to the next.

I balance my focus on actuarial and retirement issues with an interest in art. There are many other areas where one can also find a very different interest. One of my friends who is an animal lover balances her interest in retirement issues with volunteering for PAWS. (PAWS is a champion for animals—rehabilitating injured and orphaned wildlife, sheltering and adopting homeless cats and dogs, and educating people to make a better world for animals and people.) She has been able to use the skills from her working career in several ways. She does training, helps provide computer support, and helps match cats to families. The training uses her consulting and presentation skills, the computer support uses some of her technical and financial skills, and the matching builds on the skills she had in working with clients and supervising employees. The skills that actuaries have through their working careers can be valuable in many different settings.

It is valuable to have flexibility in our schedules, so that as we meet new people and encounter different ideas that sound interesting, we have time to test them out and see if they have appeal, both to ourselves and to our potential audiences. One of the advantages of being retired is that we can experiment with going down different roads and seeing what we might find.

Retirement is a time of transition. At that point we move away from established long-term obligations to a period of new activities and new freedom. We have many choices and challenges as we build our own life portfolios.

I hope this article will be of interest to those who are trying to design their own life portfolio and make phased retirement work for them. This would be a good discussion topic for the Pension Section LinkedIn site. We would love to see some postings from retired (or phased retired) actuaries that could generate additional ideas and solutions for this increasingly important phase of our lives.

PS: Thanks to Carol Bogosian and Cindy Levering for reviewing my draft and adding some interesting ideas.

Anna Rappaport serves as chairperson of the Committee on Post-Retirement Needs and Risks.