Making informed decisions about retirement
Planning for Retirement is about making more informed decisions.
Over the years we have acquired knowledge and personal insights and have grown to
trust our insights and intuition. This type of knowledge is called tacit knowledge,
and it is difficult to articulate, codify, or transfer to others. When it comes
to retirement planning, tacit knowledge plays a significant role.
Your emotional connection to retirement, your personal experiences and
how you envision your ideal retirement, the Lifestyle you want, and your sense
of fulfillment are influenced by your unique life experiences and aspirations. Don’t
discount these in your planning.
Your tolerance for financial risk in retirement is based on your
financial experiences, attitudes toward Money, and personal comfort level. These
play a substantial role in determining how you approach investment decisions
for retirement.
Tacit knowledge also guides your timing decisions. When to retire, when
to start drawing from retirement accounts, and when to make financial
adjustments are often influenced by personal experiences and judgment.
Your preferences for where you want to live, your social network, and
the activities you want to engage in during retirement are influenced and are
often shaped by personal values and past experiences.
Effective retirement planning involves a balance between tacit and
explicit knowledge. Explicit knowledge provides the factual foundation for
making informed decisions, tacit knowledge contributes to the personal and
emotional aspects of retirement planning.
Explicit knowledge is formal and codified information that can be
easily communicated, documented, and transferred. We use calculators,
spreadsheets, and financial planning software to estimate retirement needs,
project investment returns, and create budgets.
Information about retirement accounts, such as or Retirement savings
and government programs, and their associated rules and tax implications,
constitutes explicit knowledge. We gain this knowledge through government
websites, financial institutions, and financial advisors.
We also gain knowledge by paying attention to different investment
strategies, such as asset allocation, diversification, and risk management
techniques. Finally, our knowledge of estate planning, tax laws, and
regulations that impact retirement savings is essential to our planning. This
information is well documented, and we can access it through legal documents, tax
codes, and guidelines provided by professionals.
Ideally, individuals should use both types of knowledge to create a
retirement plan that aligns with their financial goals, values, and aspirations
while also adhering to sound financial principles. Consulting with financial
advisors, learning from the experiences of others, and staying informed about
financial matters can help us navigate retirement planning.
Originally Published on https://boomersnotsenior.blogspot.com/
