Posted by: drdata921 | December 20, 2013

How Will You Deal With Uncertainty in Retirement

Uncertainty is the only certainty there is, and knowing how to live with insecurity is the only security.

John Allen Paulos – Academic, Mathematician and Author

If there ever is a time of life more marked by uncertainty, it has to be retirement. Take your retirement finances as an example. Despite years of planning and saving for this magic period, you still have no way to know whether you will have enough. Why is that? Simply, because many of the factors that will affect your retirement financial security are beyond your control. Add to that the 20 – 30 year period where so much can go wrong OR right and you have a recipe for uncertainty. But, we know that uncertainty in your life can be both a dirge and a positive experience.

Uncertainty can lead to stress, but it can also lead to positive experiences as well. If everything is always predictable, you lose some of the excitement of life. Perpetual sameness is comforting to some, but would bore most of us to tears. However, if uncertainty creates a constant threat to your well-being, be it financial, physical, or psychological, then it can have a detrimental effect on your quality-of-life.

So, how well do YOU deal with uncertainty? Psychologists have developed a personality scale that measures “tolerance for ambiguity,” how well people deal with ambiguous and uncertain situations. Some people thrive in the face of uncertainty. They see this as a welcome challenge and are quite able to roll with the punches and adapt. Others only function well when everything is certain and predictable. When faced with uncertainty, they become stressed out which can lead to depression and physical illness. Obviously a high level of adaptability is the desired state for a retiree. However, everyone is different.

Notwithstanding the fact that psychologists treat tolerance of ambiguity as a personality trait, is this something that you can learn? What I am asking is whether the ability to cope with an uncertain environment is something that is in your genes (or set in stone due to your upbringing) or something that you can learn at any time in your life. Can you become more resilient in how you handle volatile economic conditions or uncertainty in your personal life? Certainly, retirement will challenge you on both of these. Things are about to change and will require you to adapt to a whole new life-space. This is not necessarily a bad thing. However, any changes as major as those your will face as you enter retirement can throw you off stride for a time.

Here are some coping strategies that I would recommend to help you deal with uncertainty and prosper in the face of major changes:


The time to plan your life in retirement is not the day that you retire, but well before. Many people spend years planning their retirement finances. You can bring some certainty to this by learning what is required to be successful and having an intelligent savings strategy. However, believe it or not, many retirement planners think that the real challenges in retirement are not necessarily financial. A much larger challenge is how you convert from daily activities in the “work-a-day” world to much more freedom in retirement. The good news is that in retirement you will be freer. The bad news is that in retirement you will be freer. If you want a positive experience, you will need to plan for it. As I have noted in this blog before, it is not difficult to fall into inactivity and spend your life in front of a TV. In the working world you had deadlines and other pressures to keep you moving forward.

In retirement you need to create a whole new set of motivations. What gets you out of bed in the morning? What creates the excitement for you? How will you find meaning in your retired life? You need to close your eyes and envision your perfect life in retirement. Then map out a plan to achieve that vision. Your retirement can be anything you want it to be. However, you need to take the bull by the horns and make it happen.


This may be just a special case of the first point above. However, it is important to call this out separately. If you face the future with dread, then you may become stressed out. However, here is a better solution: Rather than dread what may or may not happen in the future, develop a battle plan. Think of all of the challenges that can happen, financially and in your personal life and come up with a plan for how you will handle it. Shift your mentality from “bad things may happen – woe is me” to “if and when bad things happen, here’s what I will do.” Helplessness is stressful, but you can relieve the stress by anticipating and developing a planned reaction. You will be surprised at how much more confident you will feel!


Here is something that psychologists know and you should too: Stress is self-inflicted. The negative emotions associated with stress are not generated by what is happening to you, but by how you interpret the situation and react. Do you know people who are inscrutable – nothing ever seems to bother them? Do you know others who are a constant ball of negative energy – if the sky is not falling, it’s about to? It’s all in the attitude that you adopt about things that happen in your life. If retirement challenges are things to worry about, then you could be in for a constant state of distress. If retirement challenges bring new experiences that you see as exciting, then things will be much more positive. It’s all in the attitude that you adopt and this is totally up to you. Adopt a positive, optimistic attitude and retirement will be a much more pleasant experience. The choice is yours.

Now, some of you may think that I am just being “Dr. Sunshine” – sounds good, but it’s just a lot of feel-good psychobabble. So, let me recommend a book that will bring this idea home. It’s “Man’s Search for Meaning” by Viktor Frankl. Viktor Frankl is a holocaust survivor who came to one realization while incarcerated in a Nazi concentration camp. You can’t always control what is happening in the world around you, but you can control how you react to it. This epiphany helped him survive the experience.

This obviously is a little more extreme than the challenges you will face in retirement (or at least one would hope), but the concept is the same. You can approach the world with a gloom-and-doom attitude or you can approach it with optimism and the belief that you can handle anything that comes your way. To quote I Ching – the ancient Chinese book of wisdom: “The RESPONSE is EVERYTHING.”



  1. Read “Man’s Search…” in High school …. Wonderful book. I also would like to recommend “Do Less, Achieve More” by Chin-Ning Chu. Sounds like a business book, but really more about not fighting against what life brings us… Helpful for control freaks like me!

    • Thanks for the Chin-Ning Chu reference. I have ordered the book and look forward to the read. What is really interesting is how important attitude and personal psychological perspectives are to life satisfaction. We do, to a large extent, shape our own realities by how we interpret and respond to the world. Something to think about.

      • Look forward to your thoughts on the book!

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