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7 Reasons You Shouldn't Fear Retirement

Tom Sightings
A retired couple sits on a bench in Enghien-les-Bains, north of Paris, August 26, 2013. REUTERS/Christian Hartmann

Many people panic at the thought of retirement. How can you live without a regular paycheck? What do you do every day if you don't go to work? Well, stop and take a deep breath. Ignore all that anxious advice you get from people trying to push a political agenda or sell a financial product.

Of course, you should use some common sense and plan ahead for retirement. Figure out your financial future as best you can and take care of yourself by exercising and eating right. But here are seven reasons those of us who are retired, or nearing retirement, can look forward to a reasonably comfortable lifestyle:

1. Social Security is there for you. Rumors aside, Social Security is not going broke. The system has resources to pay full benefits until the year 2033. That gives politicians 20 years to make some adjustments. But even if nothing changes, Social Security will still be able to pay 75 percent of its obligations. Nobody wants to take a 25 percent pay cut, but it's not the same as going broke. Meanwhile, the average monthly benefit for a retired worker is $1,233 a month. That's not a lot to live on, but it's a start.

2. You likely are saving enough to retire. A survey by the Employee Benefit Research Institute reported that 56 percent of baby boomers and generation Xers are saving enough for retirement. That means 44 percent are not. But many of that 44 percent have built up some savings. It probably won't be enough for a lavish retirement, but could (along with Social Security) keep them out of poverty. Furthermore, it's the younger gen Xers - people in their 40s - who are more likely to be behind on their savings, and they have time to catch up.

3. You will spend less than you think. Unless you plan a grand tour of Europe, your living expenses will go down after you retire. You'll pay lower taxes because you will no longer face payroll taxes. Your housing costs should go down if your mortgage is paid off. You might even qualify for a senior discount on real estate taxes, or decide to downsize your family home and live in a less expensive place. Presumably you will not be supporting your kids. And don't forget: You will no longer have to save 5 to 10 percent of your income for retirement.

4. Your medical bills will be taken care of. At age 65 you're eligible for Medicare, which is a better deal than Obamacare. It's true that Medicare does not pay all your medical expenses. That's why it's important to purchase a supplemental insurance plan, which is typically a fraction of the cost of regular health insurance. It's also true that if you become incapacitated and go into a nursing home, the expense can be astronomical. But Medicaid pays that bill for a lot of people, and long-term care insurance is available for those with higher incomes and assets to protect.

5. You could be healthier. Experts don't agree whether working is good for you or not. It likely depends on what kind of job you have. But many people see an improvement in their health after they retire because their stress levels go down, and they have more time to exercise, cook healthy meals and take care of themselves. But it is important to stay active. So now's the time to follow your dream, whether it's starting your own business, writing your memoirs, researching your family background or selling crafts on Etsy.

6. There is no war on seniors. If you follow the media, you might think Ben Bernanke has declared war on seniors by keeping interest rates low. President Obama has supposedly declared war on seniors by raiding Medicare to pay for the Affordable Care Act. And Republicans are attacking the federal deficit by targeting Social Security. But as long as seniors vote in large numbers and support lobbyists in Washington, politicians will be loathe to make major cuts in retiree benefits.

7. You'll be happy. A researcher from Princeton University found that people are happiest in their mid-20s, then again in their mid-to-late 60s. But remember, happiness depends as much on a positive approach to life as it does on external factors. As you get older you will inevitably lose friends, and experience physical ailments and limitations. How happy you are with all these changes depends as much on you as it does on the changes themselves.

Tom Sightings is a former publishing executive who was eased into early retirement in his mid-50s. He lives in the New York area and blogs at Sightings at 60, where he covers health, finance, retirement and other concerns of baby boomers who realize that somehow they have grown up.

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