The Emotional Side of Retirement

We all know what has to be done when it comes to our finances for retirement…investing, saving and years of planning. But many entrepreneurs have not thought about how they will emotionally handle this new stage in their lives.

Many definitions of retirement are similar to “the act of ending your working or professional career”. Sounds exciting, doesn’t it?

In my experience one group that generally does not transition gracefully through the act of ending their working or professional careers are entrepreneurs. The following quote from “You Can’t Fire Me I’m Your Father” by Neil N. Koenig sums up the reason why very well!

“Work is fun; it is seductively engrossing and exhilarating when it provides challenge, risk and reward.” This is what entrepreneurs live for and it certainly has a lot more appeal than a traditional definition of retirement.

I would love to be able to create a word to replace “retirement”… for many people that’s one of the biggest hang-ups. There’s an implication that you no longer are as useful to your business as you have been in the past. The roles may change. However, the importance of the knowledge, skills and experience that the entrepreneur can continue to bring to the business can be invaluable. When and how does retirement occur? I think there is no definitive answer to that question (or should there be).

Entrepreneurs quite often are stubborn, independent, confident and resilient. These characteristics work well while building up the business but often work against the entrepreneur when the time comes to pass on, sell or retire from the business. These characteristics cannot be turned off like a switch.

Let’s explore a few emotionally driven areas related to retirement for entrepreneurs.

Control, Identity and Purpose

Understanding how and when to give up control depends a lot on why one wants to keep control in the first place.

Wanting to keep control may arise because the entrepreneur feels no one can replace the skills they bring to the table. It can also arise from the fear that the next owner will do better.

There is also control for control’s sake. That usually happens when recognizing mortality and keeping control of the business is often one of the ways of putting that recognition out of mind.

Then there is control that’s kept because there is nothing else to replace it.

For the entrepreneur, the business may have been the focus of their purpose for decades and that has become their identity. That purpose and resulting identity has been imbedded in structure. However once the entrepreneur retires they may be faced with a future with no structure, no purpose and no identity and that can be daunting.

During the first few months of retirement there are usually lots of activities to be undertaken…then reality sets in. That reality may take the form of disenchantment and/or depression. A feeling of “so this is it?”.

A recently retired entrepreneur expressed these feelings. “When you have a business and become depressed you still have to deal with the business so you get up and deal with the business and the depression…when you are retired and become depressed there may not be anything out there to motivate you to get out of the depression”. That’s a depressing thought in itself.

I feel that the entrepreneurs who have a healthy and happy transition into retirement (or into new careers) are those that have started the planning process early and have created a culture of communication with their families and employees in order to create a future for themselves. One of the questions to be asked is “When not thinking about the business what am I doing when I lose all track of time?”

The answer to the above question may be the foundation on which to build the future. The business which has been an outlet for the entrepreneur’s control, purpose and identity needs to be replaced by something that will provide a similar outlet and create a vital and vibrant future.

At some point in time the entrepreneur will dispose of their business. The disposition may be voluntary or involuntary and may be to a third party or to family, but it is going to go. Let’s redefine the future before, during and after the disposition. That future may or may not include continuing participation in the business.

When a young man asked his 80 year old grandfather what he would change about his entrepreneurial career if he had to do it over, the grandfather indicated that he would have developed interests outside the business early on in his career that would give him greater purpose now.

Because we are living longer and better than generations in the past, I like to look at retirement not as an event but as a process that evolves over a period of time and a process that is just as important as succession planning or preparing the business for sale.

And that period of time will be different for each entrepreneur, their families and their business.

Leave a Reply