Paradigms are powerful. The Oxford English Dictionary defines them as “a pattern or model.” The word was obscure until Thomas Kuhn used it referring to a set of concepts and practices defining a scientific discipline in his 1962 book, The Structure of Scientific Revolutions. Now, it is popularly used to define how someone looks at anything.
Our personal retirement paradigm is built from our hopes and dreams (what we expect to do in our senior years) and our financial expectations (money we will need to fulfill those expectations). The paradigm we have constructed about retirement can be hopeful and encouraging, or it can be crushing and defeating.
The image we have of what we want to do is relatively simple. Most can identify things we want to do with our time. We may want to continue serving in ministry, although in a different role. We may long to live closer to family, spending time with children and grandchildren. There is probably a hobby in which we hope to devote time.
Regrettably, the financial paradigm we have constructed of how those dreams will be accomplished may be crushing our hopes. Suggestions we accumulate one million dollars or more before entertaining the idea of retirement are commonplace. In July 2019, CNBC suggested a family would need $1.7 million. In May 2020, Business Insider proposed the number would only be $1.25 million! For those whose life is invested in ministry, this paradigm of retirement can be crushing. For those with talents not bent toward finances, dreams of accumulating such a sum of cash may be off-putting.
We propose a different paradigm. Rather than stockpiling a specific wealth target, view retirement through the model of boating, kayaking, or canoeing a river or lake. Here are 4 thoughts on creating this different paradigm.
- Build your personal retirement paradigm. Most regions have streams, rivers, lakes, or beaches drawing people for relaxation and refreshment. Just as these areas create a positive image, we need an image that compels us toward achieving our goal. Find your favorite peaceful place in nature, the place that begs you to get away from things, to form the paradigm for your retirement. Allow this image to compel you to make financial decisions enabling your retirement dreams to become reality.
- Your retirement paradigm is fed by many tributaries. We are blessed to reside near “the Great Lakes of the South.” Thousands across the USA flock to Melton Hill, Fort Loudon, and Tellico Lakes for rowing, canoeing, kayaking, boating, fishing, skiing, and swimming. What may go unnoticed is the number of tributaries serving as the source of this water. The same is true for us as we build for retirement. The Christian Churches Pension Plan is one of many church-sponsored pension plans providing a monthly income for life. Those in ministry may also use 403(b) plans, Roth IRAs, traditional IRAs, Social Security, savings and investment accounts, as well as income from part time employment to make retirement a reality. The paradigm of many tributaries creating a stream of income may be more realistic and compelling for those in ministry, missions, and nonprofit service.
- A controlled release is vital. In order for any of the Great Lakes of the South to provide these waters, a dam controls the flow of water downstream. The same is true for our retirement paradigm. We must include the concept of controlling spending. When we decide to change gears and alter our service, the temptation to fill all the newly minted free time with activity can drain our resources. We should be careful not to create a sense of panic about spending in retirement, but we must include a well-planned budget.
- Avoid the froth and the foam. Rapids in a river are beautiful. People of proper experience and skill can navigate these waters that may prove much too dangerous for a novice. When it comes to saving and investing for retirement, we suggest including the concept of dangerous waters in our paradigm. There are going to be many suggestions and predictions about investment opportunities that appear alluring but may be better kept at a distance. Consider these recent headlines, “3 Stocks Will Safeguard Your Retirement,” and “These Cheap Dividends Are Going to Zero.” The first article recommended three stocks as safeguards, but it is easy to find others who recommend avoiding each of the three. The second article offers a warning that sometimes the promise of big returns can be too good to be true. Calmer waters may not be as exciting, but they can get us where we want to go. Spreading our retirement funds into many baskets may seem boring, but it can get us where we want to go.
Paradigms work when they inspire us, when they are based upon the talents we possess and our experiences in life. Those serving in helping professions, like ministry and nonprofit service, often have talents and experience much different than those of corporate and financial employment. We all need to build toward retirement. We cannot leave it to chance. We must not blindly hope things “fall our way.” Find the paradigm that compels you to build the future of your dreams; then build the streams of income that will make those dreams reality.