What Is Retirement Lifestyle Planning—and Why It Matters
- W. Scott Hurt, CFP®, CPA
- Sep 26
- 15 min read
While traditional retirement planning focuses on accumulating wealth, retirement lifestyle planning focuses on aligning your money with your actual retirement dreams and daily activities.
Without this planning, you may reach retirement financially prepared but emotionally and practically unprepared for the transition.
At Covenant Wealth Advisors, we've seen it all too often. That’s why it’s essential to prepare in advance—proactively planning for your retirement lifestyle can help create a smoother and more fulfilling transition.
Retirement lifestyle planning goes beyond traditional financial planning by mapping your actual day-to-day life in retirement, ensuring your money supports the experiences and activities you truly want. .
Most wealthy individuals focus solely on accumulating assets but skip the crucial step of designing how they’ll actually live and spend their time in retirement, often overlooking how to maintain their current lifestyle once they stop working.
Key Takeaways
Retirement lifestyle planning focuses on designing your actual day-to-day life in retirement, not just accumulating money
Most wealthy individuals have sufficient assets but lack a clear vision for how they’ll spend time and energy during retirement
Goal setting is essential in retirement lifestyle planning, as it helps define clear objectives for your retirement, including lifestyle, legacy, and financial goals
Lifestyle planning should begin 10-15 years before retirement to allow for gradual transitions and course corrections
The process involves identifying core values, desired activities, relationships, and legacy goals
Without lifestyle planning, retirees often experience depression, purposelessness, and relationship strain despite financial security
Successful lifestyle planning requires ongoing adjustments as your priorities and circumstances evolve
The integration of financial planning with lifestyle planning creates a more fulfilling and sustainable retirement experience
Table of Contents
Are You Concerned About Retirement? We Can Help You Plan With Confidence
RETIREMENT INCOME PLANNING - Estimate when you might retire and what lifestyle your current savings could support.
TAX PLANNING FOR RETIREMENT - Identify ways to reduce taxes in retirement, including Roth conversions and RMD strategies.
INVESTMENT MANAGEMENT - See how a tailored portfolio can align with your retirement goals and risk tolerance.
What Exactly Is Retirement Lifestyle Planning?
Retirement lifestyle planning is the systematic process of designing your post-career life around your values, interests, and relationships rather than just your financial capacity. Unlike traditional retirement planning that focuses primarily on accumulating sufficient assets, lifestyle planning starts with your vision for how you want to live and works backward to create the financial and practical framework to support that vision.
The process involves several key components.
First, you identify your core values and what gives your life meaning. Take time to reflect on your values and priorities when designing your retirement lifestyle.
Second, you envision how you want to spend your time, including work, hobbies, travel, and relationships. Goal setting is crucial here, as it helps clarify your retirement vision and define the objectives you want to achieve.
Third, you consider practical matters like housing, healthcare, and geographic preferences.
Finally, you integrate these lifestyle elements with your financial strategy to create alignment.
”Most of our clients come to us thinking they need a certain dollar amount to retire,” explains Megan Waters, CFP® at Covenant Wealth Advisors in Richmond, VA. “But when we dig deeper, we discover many individuals haven’t thought about what they actually want to do with their time or how they want to feel in retirement. The money is just a tool to support their vision.”
This approach differs significantly from traditional retirement planning. Traditional planning typically starts with retirement calculators and withdrawal rates. Lifestyle planning begins with questions like: What activities energize you? What relationships matter most? What legacy do you want to create? How do you want to contribute to your community?
The lifestyle planning process also addresses the emotional and psychological aspects of retirement. Many successful professionals derive significant identity and purpose from their careers. Lifestyle planning helps you develop new sources of meaning and structure before you retire.
Pro Tip: Start by writing a detailed description of your ideal retirement day, from morning to evening. This exercise is an example of how to begin the retirement lifestyle planning process and often reveals preferences and priorities you hadn’t consciously considered. Get started by downloading our Master List of Retirement Goals.
Why Do So Many Wealthy Retirees Struggle Despite Financial Security?
Financial security doesn’t automatically translate to retirement satisfaction. As more people enter retirement, a growing number are experiencing challenges that go beyond money.
Many retirees experience what researchers call “retirement syndrome” – a combination of depression, anxiety, and loss of purpose that occurs despite having adequate financial resources. This phenomenon affects an estimated 25-30% of retirees, with higher rates among previously high-achieving professionals.
While managing finances is important, focusing only on finances can leave retirees unprepared for the emotional and lifestyle aspects of retirement. The primary reason for this struggle is the lack of intentional life design. Most successful individuals spend decades building their careers and accumulating wealth but give little thought to what comes after. They assume that financial freedom automatically equals life satisfaction, but retirement requires different skills and mindsets than career building.
Identity loss represents another significant challenge. When you’ve defined yourself by your professional achievements for 30-40 years, retirement can feel like losing a fundamental part of who you are. Without a clear sense of purpose and structure, many retirees feel adrift and purposeless.
Relationship dynamics often shift dramatically in retirement as well. Couples who functioned well while both were working may struggle when they’re together 24/7. Adult children may resist their parents’ increased involvement in their lives. Social connections based on work relationships may fade without professional context.
The abundance of choice in retirement can also be overwhelming. When you can do anything, deciding what to do becomes paralyzingly difficult. This is particularly true for high-achievers who are accustomed to clear objectives and measurable progress.
Physical and mental health challenges compound these issues. The stress of major life transitions can trigger health problems, and the loss of structure can lead to declining physical fitness and mental sharpness. Many retirees underestimate how much their work routine contributed to their overall well-being.
How Do You Begin Planning Your Ideal Retirement Lifestyle?
Starting your retirement lifestyle planning requires a systematic approach that balances dreaming with practical planning. The process begins with deep self-reflection about your values, interests, and aspirations. This isn’t about creating a bucket list but rather understanding what gives your life meaning and satisfaction.
Begin by conducting a values assessment. What matters most to you: family time, intellectual stimulation, creative expression, community service, adventure, or spiritual growth? Your retirement lifestyle should align with and amplify these core values. Many people discover that their true values differ from what they assumed during their working years.
Next, envision your ideal retirement across multiple dimensions. Consider your daily routine, seasonal patterns, and long-term goals. Where do you want to live? How do you want to spend your time? What relationships do you want to prioritize? What new experiences do you want to pursue? What legacy do you want to create? Don’t be afraid to explore new ideas for your retirement lifestyle—sometimes an off-the-wall idea can lead to the perfect plan.
Mark Fonville, CFP® at Covenant Wealth Advisors in Richmond, VA, emphasizes the importance of practical considerations: “We encourage clients to think beyond the vacation phase of retirement. What will you do when you’re 75 or 80? How will you maintain purpose and connection as you age? These questions help create a more comprehensive and realistic retirement vision.”
Create a detailed lifestyle budget that goes beyond basic living expenses. Include costs for hobbies, travel, entertainment, gifts, and unexpected opportunities. Many wealthy retirees underestimate their spending in these areas because they’ve been too busy working to fully explore their interests.
Test your retirement vision through trial runs. Take extended vacations to places you’re considering for retirement. Volunteer for causes you might want to support. Pursue hobbies you’ve always wanted to try. These experiences provide valuable data about what you actually enjoy versus what you think you’ll enjoy.
One benefit of experimenting with different activities before fully retiring is that you can refine your plans and make more informed decisions about your future lifestyle.
Pro Tip: Create a “retirement budget” that includes not just expenses but also time allocation. How will you spend your 40-50 hours per week of newly available time?
Spending Time with Loved Ones: The Social Side of Retirement
One of the most rewarding aspects of a fulfilling retirement lifestyle is the opportunity to spend more quality time with loved ones. After years of balancing work and family, retirement offers the chance to reconnect and strengthen relationships with family and friends. However, many retirees find that leaving the workplace can also mean losing the daily social connections that came with their job. To maintain a vibrant social life, it’s important to be intentional about nurturing these relationships.
Consider making regular plans with family—whether it’s weekly dinners, monthly outings, or annual vacations. Scheduling time with friends, joining group activities, or even volunteering together can help maintain strong social connections and provide a sense of community. These shared experiences not only enrich your retirement lifestyle but also support your mental health and overall well-being.
Don’t overlook the practical side of staying connected. Travel expenses to visit children, grandchildren, or friends can add up, so it’s wise to include these costs in your retirement plans.
A financial professional can help you account for these expenses, ensuring your retirement adjustment is smooth and your social life remains active. By prioritizing relationships and planning for the associated costs, you can create a retirement lifestyle that’s both emotionally and financially fulfilling.
Maintaining Mental Health and Emotional Well-being
A truly enjoyable retirement lifestyle goes beyond financial security—it also means taking care of your mental health and emotional well-being. Retirement is a major life transition, and it’s normal to experience a mix of emotions, from excitement to uncertainty. To support your well-being, make it a priority to engage in activities that bring you joy and a sense of purpose.
Staying connected with others is a powerful way to boost mental health. Whether it’s joining a community group, participating in local events, or simply spending time with friends and family, social connections are essential for happiness and resilience as you age. Pursuing hobbies, spending time in nature, or volunteering can also provide fulfillment and help you maintain a positive outlook.
It’s important to be proactive about your health as you get older. Regular exercise, a balanced diet, and mental stimulation can help reduce the risk of age-related issues like cognitive decline or depression. If you notice changes in your mood or mental health, don’t hesitate to seek support from professionals or community resources.
By making your mental health a central part of your retirement lifestyle, you’ll be better equipped to enjoy this new chapter and maintain your overall well-being.
Staying Active and Engaged: Hobbies, Fitness, and Community
An active and engaged lifestyle is a cornerstone of a fulfilling retirement. With more free time, retirees have the perfect opportunity to explore new interests, revisit old passions, and become more involved in their communities. Whether you’re interested in painting, gardening, learning a new language, or playing music, pursuing hobbies can add excitement and meaning to your daily routine.
Physical activity is equally important for maintaining both mental health and physical well-being. Consider incorporating regular exercise into your retirement plans—activities like walking, swimming, yoga, or group fitness classes can help you stay healthy and energized. Community involvement, such as volunteering, joining clubs, or participating in local events, not only keeps you active but also fosters a sense of belonging and purpose.
When planning your retirement lifestyle, remember to factor in the costs of staying active and engaged. Expenses like gym memberships, class fees, or hobby supplies can add up, so it’s wise to work with a financial professional to align these interests within your retirement plans. By prioritizing activity and engagement, you’ll set the stage for a retirement that’s both enjoyable and rewarding.
What Are the Most Common Lifestyle Planning Mistakes?
The most frequent mistake in retirement lifestyle planning is waiting too long to begin the process. Many people start thinking seriously about their retirement lifestyle only months before they retire, leaving insufficient time to make necessary adjustments or prepare emotionally for the transition. While many plan to retire at a certain age, unexpected circumstances may require them to adjust their plans.
Ideally, lifestyle planning should begin 10-15 years before retirement. But, if you've passed that window, start now. What's important is that you think about your lifestyle before you actually retire in the first place!
Another common error is planning retirement as a permanent vacation. While relaxation and recreation are important, most people need more structure and purpose than constant leisure provides. The initial honeymoon phase of retirement typically lasts 6-18 months, after which many retirees crave more meaningful activities and challenges.
Underestimating the importance of social connections represents another significant mistake. Work provides built-in social interaction and professional relationships. Without intentional planning, many retirees find themselves isolated and lonely. Successful retirement lifestyle planning includes strategies for maintaining and developing new social connections.
Many couples make the mistake of assuming they’ll automatically enjoy spending significantly more time together in retirement. While some couples thrive with increased togetherness, others need space and individual pursuits. Failing to discuss and plan for these dynamics can create unexpected relationship stress.
Financial integration errors are also common. Some people create elaborate lifestyle plans without considering the financial implications, while others let financial constraints completely dictate their retirement vision. The most successful approach involves iterative planning where lifestyle goals and financial resources are balanced and adjusted together.
Perfectionism can paralyze the planning process. Some individuals spend years trying to create the perfect retirement plan instead of starting with a good plan and adjusting as needed. Retirement lifestyle planning should be viewed as an ongoing process rather than a one-time decision.
Finally, many people fail to consider their evolving needs and capabilities. A retirement lifestyle that works at 62 may not work at 75 or 85. Successful planning includes flexibility and contingency planning for different life stages and circumstances. It's also important to have a plan in case you need to retire earlier than expected, as unforeseen events can force a change in your retirement timeline.
How Much Should Your Lifestyle Influence Your Financial Strategy?
Your desired retirement lifestyle should significantly influence your financial strategy, but the relationship should be bidirectional. Your lifestyle goals inform your financial planning, while your financial reality may require lifestyle adjustments. The key is finding the right balance between dreams and practicality.
Start by quantifying your lifestyle vision. If you want to travel extensively, research actual costs for the types of trips you envision. If you plan to pursue expensive hobbies, get realistic estimates for equipment, instruction, and ongoing expenses. If you want to support family members or charitable causes, factor these goals into your financial projections.
Consider the timing of your lifestyle goals. Some retirement activities are more expensive in the early years (adventure travel, active hobbies) while others may increase with age (healthcare, assistance with daily living). Your financial strategy should account for these changing expense patterns throughout retirement. Plan when you will access different investments or retirement funds to support your lifestyle at various stages, ensuring you have the right resources available as your needs evolve.
Geographic arbitrage can significantly impact your lifestyle possibilities. Your retirement dollars may stretch further in certain locations, potentially funding a more luxurious lifestyle or extending your financial security. However, don’t let cost considerations completely override your lifestyle preferences.
The sequence of returns risk becomes particularly important when lifestyle planning drives higher early retirement spending. If you plan to front-load your retirement with expensive activities, you’ll need larger cash reserves and a more conservative early withdrawal strategy to protect against market volatility.
Tax planning should also align with your lifestyle goals. If you plan to be in a higher tax bracket in early retirement due to increased spending, it may make sense to accelerate Roth conversions or other tax-planning strategies while you’re still working.
Pro Tip: Create three lifestyle scenarios (conservative, moderate, and ambitious) with corresponding financial requirements. This approach provides flexibility while ensuring you have a realistic baseline plan.
Are You Concerned About Planning for Retirement? We Can Help You Plan With Confidence
RETIREMENT INCOME PLANNING - Estimate when you might retire and what lifestyle your current savings could support.
TAX PLANNING FOR RETIREMENT - Identify ways to reduce taxes in retirement, including Roth conversions and RMD strategies.
INVESTMENT MANAGEMENT - See how a tailored portfolio can align with your retirement goals and risk tolerance.
Frequently Asked Questions
Q: How much money do I need to support my desired retirement lifestyle?
A: The amount depends entirely on your specific lifestyle vision, but most financial advisors recommend having 10-12 times your annual expenses saved by retirement. Start by creating a detailed budget for your desired retirement lifestyle, then work backward to determine the required savings. Remember to account for inflation, healthcare costs, and taxes when calculating your needs.
Q: What if my spouse and I have different retirement visions?
A: Conflicting retirement visions are common and require open communication and compromise. Schedule regular conversations about your individual dreams and concerns. Consider creating separate budgets for individual pursuits while maintaining a joint budget for shared goals. Professional counseling or financial planning sessions can help facilitate these discussions.
Q: Should I pay off my mortgage before retiring?
A: This depends on your overall financial situation and lifestyle goals. If having a mortgage payment stresses you or limits your retirement activities, paying it off may be worth it even if it's not mathematically optimal. Consider your interest rate, tax situation, and how the payment affects your desired lifestyle when making this decision.
Q: What if I get bored in retirement?
A: Boredom is a common concern, especially for high-achievers. Combat this by maintaining some structure in your schedule, pursuing challenging activities, and continuing to learn new skills. Consider setting goals for your retirement years, whether they're related to fitness, travel, creativity, or service to others.
Q: How do I handle the loss of identity when I retire?
A: Identity transition is one of the most challenging aspects of retirement. Begin developing interests and relationships outside of work before you retire. Consider how your professional skills might transfer to volunteer work or hobbies. Many people find that retirement allows them to explore aspects of their personality that were suppressed during their working years.
Q: Should I move to a different location for retirement?
A: Moving can be a positive change if it aligns with your lifestyle goals and financial situation. Consider factors like cost of living, climate, proximity to healthcare, social connections, and activities. Try extended visits to potential locations before making a permanent move. Remember that you can always move again if your first choice doesn't work out.
Q: How do I plan for healthcare costs in retirement?
A: Healthcare costs can be substantial in retirement, potentially consuming about 15% of your income. Research Medicare options and supplement insurance well before you retire. Consider long-term care insurance and health savings accounts if eligible. Factor geographic location into your healthcare cost planning, as costs vary significantly by region.
Q: What if the stock market crashes right before or during my retirement?
A: This scenario, known as sequence of returns risk, is a major concern for retirees. Mitigate this risk by maintaining 2-3 years of expenses in cash, using a conservative withdrawal strategy, and maintaining flexibility in your spending. Consider delaying retirement or working part-time if markets are unfavorable when you planned to retire.
Q: How much should I plan to spend on travel and hobbies in retirement?
A: This varies greatly based on your interests, but many financial advisors suggest budgeting 5-10% of your retirement income for discretionary activities like travel and hobbies. Front-load these expenses in your early retirement years when you're more likely to be active and healthy. Create specific budgets for your planned activities to foster realistic expectations.
Conclusion
Retirement lifestyle planning transforms retirement from a financial finish line into a purposeful life design project. The most successful retirees are those who invest as much time and energy in planning how they'll live as they do in planning how they'll pay for it. This planning process requires honest self-reflection, practical research, and ongoing adjustments as your circumstances and priorities evolve.
The integration of lifestyle planning with financial planning creates a more holistic and satisfying retirement experience. Rather than simply accumulating assets and hoping for the best, you can create a retirement that reflects your values, supports your relationships, and provides ongoing meaning and purpose. The key is starting early, remaining flexible, and viewing retirement as an opportunity for growth rather than just an endpoint.
Remember that retirement lifestyle planning is not a one-time event but an ongoing process. Your vision may change as you age, experience new things, or face unexpected challenges. The most important step is simply beginning the conversation with yourself and your loved ones about what you want your retirement to look like.
Would you like our team to just do your retirement planning for you? Contact us today for a free retirement roadmap experience.
Our comprehensive approach integrates lifestyle planning with financial strategy to help your retirement vision become reality.
About the author:
Senior Financial Advisor
Scott is a Financial Advisor for Covenant Wealth Advisors, a CERTIFIED FINANCIAL PLANNER™ practitioner and a Certified Public Accountant (CPA). He has over 17 years of experience in the financial services industry in the areas of financial planning, tax planning, and investment management.
Disclosures: Covenant Wealth Advisors is a registered investment advisor with offices in Richmond, Reston, and Williamsburg, VA. Registration of an investment advisor does not imply a certain level of skill or training. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. The views and opinions expressed in this content are as of the date of the posting, are subject to change based on market and other conditions. This content contains certain statements that may be deemed forward-looking statements. Please note that any such statements are not guarantees of any future performance and actual results or developments may differ materially from those projected. Please note that nothing in this content should be construed as an offer to sell or the solicitation of an offer to purchase an interest in any security or separate account. Nothing is intended to be, and you should not consider anything to be, investment, accounting, tax, or legal advice. If you would like accounting, tax, or legal advice, you should consult with your own accountants or attorneys regarding your individual circumstances and needs. This article was written and edited by a CERTIFIED FINANCIAL PLANNER™ professional with the assistance of AI. No advice may be rendered by Covenant Wealth Advisors unless a client service agreement is in place. Hypothetical examples are fictitious and are only used to illustrate a specific point of view. Diversification does not guarantee against risk of loss. While this guide attempts to be as comprehensive as possible but no article can cover all aspects of retirement planning. Be sure to consult an advisor for comprehensive advice.
