After laboring over the logistics of retirement—including saving, planning for expenses and figuring out where your income will come from—it’s time for a more-fun decision. How should you celebrate? A big party? A once-in-a-lifetime trip? Here are just some ways you might mark the occasion—and tips on doing it wisely, so you stay on-track financially.
5 ways to celebrate retirement today
It’s one of the biggest occasions of your life. Make it memorable (and financially smart).
A trip of a lifetime
And many are saving now for future excursions: In the year after COVID-19 brought many travel plans to a halt, 58% of boomers were more likely to have set aside unused travel funds for future getaways.
Source: AARP 2021 Travel Trends Report
1. Announce your next venture
We send out notices when we’re getting married, to announce the birth of a child or when we move into a new home. Retirement is as big a milestone as these other life events, so why not let friends, family, and even professional acquaintances in on the news with a celebratory announcement?
It’s not only about sharing the joy of the moment—there also are practical reasons for letting people know that you’ll no longer be working full-time in the job, company or industry in which you’ve invested years or decades. Including personal contact information or introducing your next post-retirement venture—be it a consulting business, passion project or charitable endeavor—will give people an opportunity to reconnect with you and support you in a new way.
2. Party smartly
A party is perhaps the most obvious way to ring in retirement, but maybe a big to-do isn’t your style, or COVID-19 cases in your area have you looking for a different way to celebrate now.
A virtual celebration offers another way to reminisce with the people you’ve worked with throughout your career. If you’re not digitally savvy, there are virtual event planners who will help you put on an online party to remember. And a digital bash has the added benefit of being easy on the wallet.
If you’re partying in person, of course, the age-old advice still holds: Set a budget and resolve to stick to it. “[Focus on] inviting the people you really want, not every person you’ve waved to in the hallway,” says TIAA Financial Planning Strategist Rob Stevens. Keeping the guest list in check will save you money on things like catering and rental fees for tables, chairs or a tent.
Stevens also suggests thinking about what party details are most important—and personal—to you: live music or recorded favorites, a sit-down meal or finger foods? Then you can adjust your budget, splurging on what feels most worthwhile.
3. Build a bucket-list trip into retirement planning
If you already know that traveling in retirement is your dream—whether it’s one big trip or annual excursions—then build it into your long-term financial plan to take advantage of the power of compounding. “[Your trip] doesn't have to be too extravagant, but if it is, it’s best to put money aside months, if not years, in advance,” says TIAA Financial Planning Strategist Mark Schrader.
If you have the means, “you [might] put an extra $15,000 or $20,000 into the plan for the first five years [of retirement],” he suggests. “As you work with your financial planner or financial professional, put it in the plan, test it out and adjust as needed from there.”
Once you have your budget in hand, it’s smart to consult a travel professional to help you put together trips that check off your must-see list, and suit your comfort level, too—whether that means a day-long flight and strenuous hike to Machu Picchu or a leisurely—and relatively local—river cruise. That pro can also guide you on nitpicky-but-essential planning details, such as travel insurance.
4. Give back—and go beyond
Making a donation to an organization connected to your career is a meaningful way to mark the occasion. And you may be able to make your donation go farther if you time your gift right. “Check before you retire to see if your employer does matching,” says Shelly Eweka, TIAA’s Senior Director, Financial Planning Strategy. “If you [make the donation] before you retire, you can potentially double it, depending on what the provisions are.”
It’s also possible to make a sizable donation that’s a source of income for you. Many non-profits and universities have charitable gift annuities, through which the sum you donate is invested. You receive a regular payout from the investment, Schrader says, “and once you pass, the charity keeps the remainder.”
5. Give yourself a gift that won’t set you back
You may see retirement as the time to finally splurge on the things you see other retirees enjoying—a she-shed for the backyard, an RV, or a gold watch to mark your years of service. But is it a purchase you’ll still cherish in a year?
Before you make that big purchase, consider another option: “Give yourself the gift of peace of mind,” Eweka says. She suggests making sure you have a source of lifetime income and setting yourself up for having no—or close to no—debt. “Then you'll always be able to provide for yourself and not have to depend on others.”