“Wait! I can’t do this. I’m not ready!” Are these the words of a patient about to get a root canal? Perhaps this is coming from a first-time roller coaster rider – just as they get strapped in. Or maybe your child shouts these words before they test their swimming skills for the first time. All are possibilities. The truth is they are the words of many a retiring business owner who is about to sell the business in which they have invested their heart and soul. Will this happen to you or someone you love?
The Need for Personal Transition Planning
Why would a highly successful business owner need help with their personal transition into retirement? Because it’s not as easy as it looks. Time and time again, I hear stories of business owners who are practically at the finish line of selling their business and suddenly they call a halt to the process. Not because it’s a poor deal but because they aren’t ready to step into the next part of their journey through life. What a shame! As you might imagine, this is happening after much of the work of putting the transaction into place has already occurred, wasting significant time, money, and opportunity.
When is the right time to start preparing? Ideally, three to five years in advance is a good target. Why so soon, you might ask? Planning and laying the foundation for a successful retirement transition involves putting some of the elements in place before you retire. This allows you to begin addressing some of the gaps that may exist while you’re still working and retire with new activities, a small side hustle or a volunteer role, or an expanded social network already in place – easing the overwhelm of having to figure it out all at once.
Retiring is a major life transition. In fact, retirement is ranked #10 in the list of most stressful life events. Additionally, twenty of the forty-three stressful events listed tend to happen near or in retirement. [i] Leaping into the unknown without a plan can feel like practicing high-flying acrobatics with no safety net. Too often, many soon-to-be retirees never get beyond a vague sense of what life will be like after selling their business. Shouldn’t something as important as the next 25 – 30 years of your life deserve your time and attention to create a written plan?
A Holistic View
What constitutes a holistic view of life after the sale? Clearly, financial considerations are an important component. However, it is a myth to believe that having your finances under control, as the only preparation, will allow this phase of life to smoothly unfold. A holistic view takes into consideration the spiritual, mental/emotional, physical, and social aspects, as well. Attending to each of these areas, in addition to your finances, sets the stage for you to be ready when your business is ready. Consequently, you will be far less likely to pull the plug at the last minute or sink into anxiety or depression after the sale. To give a little jump start to your thought process around this, please consider the following:
For our purposes here, spirituality is defined as the core values that guide how you live your life. They are the principles that drive you and what you hold as most important to you.
What are the top five values that drive you? Take the time to clearly define what they uniquely mean to you. How might these values begin to inform you of what needs to be a part of your post-sale life? What are your initial ideas about how these values will be honored in new ways?
The role that mindset plays in retirement is understated at best. Often, your feelings and ideas of what retirement will be like are a far cry from what reality will bring. As a business owner, you likely have a passion for the product or service that you have offered. Now, you need a new outlet for that passion. Too often, we conflate what we do with who we are. It’s no wonder then, that losing one’s sense of identity is one of the top issues faced in retirement.
Replacing one’s work identity is not accomplished in an afternoon. It requires investing the time to step back to reflect on this question. Who do I want to become? Remember that you still have much to offer the world. Clarity on who you want to become, then leads to exploring what you want to do to express that. The possibilities are endless from some new form of work, to connecting with family, to community involvement, to new hobbies, and so on. What will it be for you?
Addressing your physical health is another key element to your overall well-being in retirement. What role do proper nutrition, exercise, sleep, and relaxation currently play in your life? Be honest with yourself on your current state of physical health and select one area to begin making improvements. The sooner you start, the greater the benefits, and the easier it will be to maintain a healthy lifestyle in retirement.
I encourage you to continue the positive health habits you already have in place and to make a commitment to expand into any elements that are missing. By the time you are ready to sell, you will have strong habits to support your physical well-being during your retirement years. Even if you are already experiencing some type of ailment, taking steps to do as much as you are capable of will support your ability to thrive.
Many of you may already have a strong social network around you. Over the years of owning your business, you likely have connections throughout the business community, charitable organizations, employees, clients, and customers. On an average day, you may interact with dozens of people. After retirement, this daily interaction may be significantly less which feeds a sense of isolation over time. Currently, how much time do you spend around others each week? What will replace that social connectivity after you sell?
As you approach retirement, developing relationships beyond the world of work takes intention. If you embrace the value that relationships and a sense of belonging contribute to your overall wellness, then you will make the time to expand your connections. What groups as you interested in and could start to explore before you sell? What shared interests do you have with neighbors and others in the community?
There are many moving parts to retirement and it constitutes a significant transition in your life. That transition can be an amazing time, or it can be fraught with disenchantment. You get to choose how it turns out for you. Preparing early will allow you to seamlessly move from pre-sale to post-sale with the confidence that you know what is next for you. You worked hard to create the business you have today. That didn’t happen without planning. Doesn’t your post-sale life deserve an equal amount of preparation?
[i] Holmes Rahe Stress Scale Wikipedia, https://en.wikipedia.org/wiki/Holmes_and_Rahe_stress_scale