“When it comes to happiness and well-being in retirement, having enough money to retire may help, but it turns out not to be a primary driver of happiness in retirement. Instead, retiree satisfaction is much more driven by what retirees actually do with their time in retirement.
Accordingly, the authors of a study leverage the data in the University of Michigan’s national Health and Retirement Study (HRS) to evaluate what retirees actually do with their time, and their well-being in retirement. Activities were broadly divided into two groups, including “passive” activities (e.g., staying at home and watching television) versus more “active” activities (e.g., socializing, walking, exercising, working, volunteering).
Of the roughly 11 hours of daily time outside of sleeping and “essential” daily activities (e.g., eating, housekeeping, dressing, etc.), the researchers found an average of 3.05 hours watching television and 2.81 hours staying at home alone… which were actually the activities least associated with happiness. By contrast, retirees spend an average of 1.68 hours socializing, and 0.66 hours walking or exercising, which were found to be the highest and second-highest happiness activities, respectively.
More generally, the results found that retirees spending more time on “passive” activities tended to be less happy than those engaged in “active” activities. Which in turn is important because the researchers also found that passive activities increased, and active activities decreased, as retirees themselves aged (and ostensibly became less mobile and able).
Accordingly, the researchers suggested that as retirees age, it actually becomes exponentially more important for them to try to figure out how to remain social and engaged. Though notably, the researchers also found that, at least currently, retirees aren’t very good at using their resources to do so, as there was virtually no relationship between retiree wealth and the activities they engaged in, beyond a connection that those with greater affluence did tend to spend less time watching television. [You should think about ways to] maximize the activities most likely to actually make [you] happier and more satisfied in retirement. (Especially in late retirement).” Some ideas on how to do this in part 2 of 3 of the series.
Research article providing insights:
Time Allocations And Self-Reported Happiness Of Retirees (Tao Guo, Yuanshan Cheng, Philip Gibson, & Louis Pantuosco, Journal of Financial Planning)
Quoted from Michael Kitces of Nerd’s Eye View at Kitces.com, as part of Michael’s weekly compilation of information for planners; source https://www.kitces.com/blog/weekend-reading-for-financial-planners-apr-20-21-2/ , which [I’ve edited] for a public audience for clarity and emphasis where needed.
The Trick To Keeping Friends As We Get Older (Retirement Insights Series Part 2 of 3) – Scheduled 1 Jan 2020
The Four Transitions Of Aging (Retirement Insights Part 3 of 3) – Scheduled 29 Jan 2020