Personal finance

This retirement planning gap is ‘hidden in plain sight,’ Harvard professor says

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For many people, retirement planning is all about money: how to invest, how much to save, when to claim Social Security, how to best withdraw from accounts. The list goes on.

Finances in retirement are an acute fear. About 2 in 3 people worry more about running out of money than death, according to a recent poll by Allianz Life.

Yet, there’s a notable lack of attention and concern given to the social aspect of retirement, experts said.

It’s a facet of retirement planning that’s almost “hidden in plain sight,” said Robert Waldinger, a clinical professor of psychiatry at Harvard Medical School.

Waldinger is the fourth director of the Harvard Study of Adult Development, which began in 1938. The study, the longest running of its kind, has tracked thousands of Americans throughout their lives and across different generations for the past 86 years.

A core (and perhaps surprising) finding: Having good relationships — whether with partners, friends, family or others — is the “strongest predictor” of living long, healthy and happy lives into old age, more so than health factors like high blood pressure and cholesterol, Waldinger said.

Money is the “obvious” focus when it comes to retirement planning, Waldinger said.

“[But] if you want to be happy, it’s mostly not about the money,” he added.

Put another way: “Social connections are really good for us” and “loneliness kills,” Waldinger explained in a 2015 TED Talk titled “What makes a good life?” It’s one of the most viewed TED Talks of all time.

How stress impacts our health

Relationships play a big role in preventing and relieving stress.

When someone is stressed, their body revs up into a fight-or-flight mode, triggering reactions like an increased heart rate, Waldinger said.

Having someone to talk to or even complain to at the end of the day about a particular stressor helps the body calm down and return to equilibrium, he said.

Someone who’s unable to do that stays in a low-level fight-or-flight mode. Higher levels of stress hormones like cortisol build up, breaking down body systems, increasing inflammation and contributing to health issues like arthritis, diabetes, heart disease and weakened immune function, Waldinger said.

Loneliness and isolation are stressors, in and of themselves, he added.

The mortality impact of being socially disconnected is like smoking up to 15 cigarettes a day, the U.S. Surgeon General said in a 2023 report on the nation’s loneliness “epidemic.”

Stressors “break down our bodies in all kinds of ways,” said David Sbarra, a psychology professor and director of the Laboratory for Social Connectedness and Health at the University of Arizona.

People also often try to regulate the negative effects of stress via drinking, smoking or doing drugs, which are other pathways to adverse health impacts, Sbarra said.

By contrast, having broader social networks and more social activity delays and slows cognitive decline, for example, Waldinger said. The Harvard study found that married people also lived longer than their single counterparts — five to 12 years longer for women and seven to 17 years longer for men, on average.

Why retirement can be stressful

The transition into retirement “is a period of stress,” Sbarra said.

For one, there’s an “upheaval” associated with identity transition. Retirees close one chapter of their lives and must choose the contours of their next chapter, he said.

That stress can become chronic if people don’t manage the transition well, and physical health may suffer as a result, he added.

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Relationships and the quality of those connections “play a key role” in helping regulate stress. However, the bulk of many people’s close relationship needs may be met at work, Sbarra said. In such cases, retirement strips away those interactions.

“Some people say, ‘It’s too late for me'” to make new social connections, Waldinger said.

“One of the things we know from study: It isn’t too late. People make all kinds of new connections and friendships when they’re older, in all phases of life,” he added.

Does money play a role in retirement happiness?

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This isn’t to say money is not important. Experts say finances do have a bearing on happiness in retirement, to a point.

“You need to have your [financial needs] met,” Waldinger said.

Just as the lack of strong social connections is a cause of stress, so is the lack (or perceived lack) of financial resources, said Yochai Shavit, director of research at the Stanford University Center on Longevity.

However, if the goal of retirement is to live a happy, healthy and fulfilling life, having social capital is as important as financial capital, he said.

“We are very strategic when it comes to our money and planning for retirement, and perhaps not strategic in the same way … when it comes to planning our social and emotional capital,” Shavit said.

3 steps to strengthen your relationships

The Harvard study shows it’s not just quantity of social connections that’s important; it’s the quality of your close relationships that matters, Waldinger said.

For example, living amid conflict is “really bad” for our health, he explained in his TED Talk. A “high-conflict” marriage without much affection is perhaps worse for health than getting a divorce, for example, he said.

Further, loneliness is a subjective experience, he told CNBC. Some people are introverts who may only need one or two meaningful relationships, for example.

“You can be lonely and have a ton of people around you, or not be lonely and be a hermit on a mountain,” he said.

Near-retirees or retirees who want to assess the quality of their relationships and/or strengthen their existing connections can take three steps, Waldinger explained.

First, ask: Do I have enough people I feel connected to in my life? Am I connected to others in the way I want to be?

“It’s really [about] checking in with yourself,” Waldinger said.  

Second, assess if you can improve relationships with the people already in your life who you value and enjoy spending time with. Can you do more with what you already have?

This could be anyone: perhaps a sibling, friends or romantic partner. For example, you could replace screen time with people time, liven up a relationship by doing something new together (like long walks or date nights), reach out to a family member you haven’t spoken to in years. Even talking to someone on the phone, or sending a text or e-mail, can help.

“It doesn’t have to be heavy lifting,” Waldinger said.

Third, assess if you can form new connections.

Among the easiest and quickest ways to do this is by doing something you enjoy or care about alongside people you don’t know yet, Waldinger said.

For example, join a gardening club, political campaign, church group or a campaign to prevent climate change, he said.

It becomes easier to start conversations with new people because you both have this thing in common, he added.

The people in the Harvard study who were happiest in retirement were the ones who actively worked “to replace workmates with new playmates,” Waldinger said in his TED Talk.

“Relationships are messy and they’re complicated, and the hard work of tending to family and friends, it’s not sexy or glamorous,” he said during that TED Talk. “It’s also lifelong. It never ends.”

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