Planning for Retirement
Requires a Good Pair of Shoes
By Lloyd M. Gordon, President
GEC Consultants, Inc.
Skokie, IL 60076
A friend of mine named Charlie opened his restaurant one morning as he had done more than five thousand times before. The weather was snappy cold, but not worse than it had been a hundred times previously. Suddenly, a sensation of foreboding sent a shiver through his well-clad body and as he twisted the key in the lock of the rear door of his restaurant, he began to sweat. Quickly he removed his outer wear, hung them in the office and started the coffee brewing.
Charlie always started the coffee brewing first thing every morning. Today was no exception. But last night's question seemed to gnaw at a secret place in his thoughts that was very private to him. Still perspiring, he turned on the cooking equipment. He wondered why the question his eldest son John had asked him last night was affecting him in this unique way?
John had asked point blank, "Dad, when do you plan to retire?"
"Nonsense," he silently responded through clenched teeth, "But why did John bring up the question of my retirement? " As he had last night. Charlie still had no answer.
Where are you now on the retirement ladder?
If fate is kind to us, all restaurateurs have an opportunity to retire. They can do what they wish, when and where they want to do it. From the very first day we began our journey in business we had our shoe on the first rung of the retirement ladder. Most of us didn't even realize it then.
What type of life style have you grown accustomed to enjoying?
Now the years have past and the responsibilities toward our family may have grown softer. We begin to see that we can now look forward to a time when we can enjoy our life. A key question for us is what lives have we grown to enjoy and do we wish to maintain it, or do we seek change and new vistas?
How many years will it be until you wish to draw income from savings and retirement funds?
Do you want to stop working altogether and retire?
If this is your dream, you must develop a strategy for utilizing the assets you have accumulated over the years and make them produce the results you seek in complete retirement.
Or do you wish to work part-time as you feel like it?
Retirement for you may be "taking it easy" and working only if and when you desire to do so. This possibility relieves all pressure from you to accomplish any defined tasks. A goal like this requires a different type of retirement orientation than the previous plan.
Or do you desire to stay fully active but be selective as to the projects to undertake?
In this instance you can brag about never retiring. In fact you certainly can but because the pressure to succeed will be removed you will be in a more relaxed mode. This requires yet another approach to retirement scheduling that differs from the two previous plans.
Have you factored in the impact of inflation into your retirement planning?
Inflation is the most critical unknown in your retirement equation. What you imagined as a satisfactory retirement income some years ago when you first began to plan, and what you will actually require in future dollars when the day for retirement arrives can be shockingly different. You must give this serious consideration.
Do you have a contingency plan if you become disabled or severely ill before your retirement date?
Few of us can picture us actually being helpless and unable to fend for ourselves. Such things occur and when they do they can demolish even the best thought out retirement plans. You must hedge your bet and have emergency resources for such an eventuality.
If you are married, have a family or have people for whom you are financially responsible, how have you fit them into your retirement planning?
When you retire, will you have obligations beyond those for yourself and your spouse? If yes, then you may require special plans to take care of yourself and them in your retirement years.
Have you planned so that alternative expenses such as college tuition for your children are not taking the money that would ordinarily go toward your retirement?
Will such a circumstance destroy your retirement nest egg? If you haven't made arrangements for such diversions of your retirement income, you should give thought to that now. There may not be enough money to go around in that vision of the future.
At retirement what happens to your role in your business?
Will you hire someone to take over your management role?
Have you developed a management team that can keep things running if you're not actively steering the ship? It may already be too late for this, but then again each person's circumstance is unique. If this is your strategy, then begin to consider the actions you must take now.
Would it be cost effective to lease out your business or have you thought of other options related to selling?
If you don't prefer to operate your business personally, you can make plans to lease it or sell it. If you own the real estate, you have the option of leasing it or selling it along with the business. You should make plans now and it is never too late to set the plan into motion that you desire for your retirement.
What are the tax consequences of your retirement plan from your business?
The way you structure your tax liabilities if you sell or lease your business can be crucial to your personal retirement plan and the income you have for your retirement years. This should be discussed with a professional once you select a course of action for stepping out of your involvement in the daily operation of your business.
How will your life style change, or will it stay the same?
Good retirement planning should permit you to create an image of yourself in the retirement mode. It should show you doing things you enjoy with people that please you. Above all, it should all be affordable.
Will you have a lot of time on your hands that could make you ill at ease?
You should give thought to how you will spend your time. If you are the energetic type, you don't want to plan for doing small things that will bore you. However, if you are worn out, you may seek activities that are calming and restful to fill your time. Good use of your time is essential for a satisfactory retirement scenario.
Mr. Lloyd M. Gordon, President of GEC Consultants, Inc. has an MBA from the University of Chicago. He has concepted more than 390 restaurants and has been consulting for over 44 years. He helps people enter the restaurant industry, points the way to profitability, and helps keep them successful. To discuss "Planning for Retirement Requires a Good Pair of Shoes" he can be reached at 847-674-6310.
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