Book Review: How to Retire

 Christine Benz’s How to Retire: 20 Lessons for a Happy, Successful, and Wealthy Retirement is a thought-provoking and practical guide to navigating one of life’s biggest transitions. Drawing on her expertise as Morningstar’s Director of Personal Finance, Benz compiles insights from 20 retirement thought leaders, each contributing a single lesson on what makes retirement fulfilling and financially secure. While the perspectives sometimes differ, the book offers a wealth of guidance for those planning their retirement or already living it.

In this post, I’ll share some key lessons that stood out.

One recurring theme from Benz’s interviews is the challenge of finding purpose after leaving the workforce. Retirement often brings a sudden shift in daily structure and a sense of identity. As one expert explains, “Serotonin gets released by our body as a way of rewarding us for maintaining a higher social status, and we lose that when we leave the workforce. In fact, it’s as if we had a steady supply of a drug while we were working, and then we leave the workforce and no longer receive it.” To address this, the book emphasizes the importance of creating a new sense of purpose through intentional habits.

One contributor suggests, “You should be very deliberate about your habits, create these grooves that you are going to follow for decades. And establish those grooves early on, so that you can develop productive habits that are not going to lead to a disappointing retirement. It seems like you probably want a combination. You want those healthy habits that you’re practicing every day punctuated with those joyful, exciting big plans.” This highlights the importance of balancing routine and spontaneity to maintain a sense of fulfillment.

Another critical component of a fulfilling retirement is identifying a purpose that motivates you to start each day with enthusiasm. One interviewee shares a powerful insight: “Purpose is not something that just falls into your lap. It’s often something you create by being intentional about doing things you think you like and investing in those things, and then seeing whether those investments pay dividends.”

Timing also plays a vital role in retirement planning. Several experts in the book advocate for delaying retirement beyond the traditional age of 65, as it can provide financial and psychological benefits. One striking statistic in the book is that “Research has shown that working six months longer is equivalent to saving about 1% extra of your pay for an additional 30 years.”

For those unsure whether they’re ready to retire, a practical exercise suggested by one expert involves creating a detailed calendar of daily activities for retirement. As they explain, “Forcing someone to go through what a week looks like is a really helpful visioning exercise. Some people have a clear view, but those who don’t should write out what they want their ideal week to be.” This tangible approach can help clarify your readiness for this significant life change.

The book also warns about retirees' financial risks, particularly cognitive decline and inflation. One expert emphasizes the importance of planning for potential cognitive challenges: “The trouble is, people experiencing cognitive decline aren’t necessarily in a good position to protect themselves; they’d ideally implement safeguards in advance. Implementing a simple portfolio and/or hiring a financial advisor to oversee your investments can help ensure that your plan doesn’t run into problems.”

Regarding inflation, another contributor warns, “If you look at economic history and financial history, the biggest risk to any investor in almost any era in almost any country is inflation.” The book suggests strategies to mitigate this risk, such as investing in Treasury Inflation-Protected Securities (TIPS). As one financial planner notes, “If you have a TIPS ladder that is yielding 1.5% in real terms, you can withdraw 4% of that every single year over the next 30 years. That way you’re getting a real income that will keep up with your standard of living.”

Finally, the book reminds readers of the importance of enjoying retirement after decades of hard work. One practical tip is to allocate specific funds for travel or other leisure activities rather than drawing from your monthly budget. One expert explains, “If you’re using the 4% guideline, you get to spend $4,000 a year. That suddenly feels really constricting. On the other hand, if you have $100,000 for travel and you can use it up in the next ten years, that feels a lot more freeing.”

Christine Benz’s How to Retire offers an excellent roadmap for creating a happy and secure retirement. The advice from the 20 contributors provides actionable steps and thought-provoking perspectives that will help anyone approaching this phase of life. From finding purpose and developing new habits to addressing financial risks and making room for fun, the book is a reminder that retirement is not an end but a new beginning. If you’re looking for insights on thriving in your retirement years, this book is well worth a read.