How to handle retirement

Retirement is not a golden age for those who thrive on power and attention. The loss of status can be devastating.

Postponing retirement has proven health benefits. But how long can you hang on?

Coming to the end of your last job as an executive, director or professional is not easy. Apart from wondering whether you have enough money to live in the manner to which you have become accustomed, you also stare directly into the abyss — an abyss not just of boredom but of early mortality.

Regardless of socioeconomic group, a landmark Shell study found, employees who retire at age 55 and live to be at least 65 die sooner than people who retire at 65. “After age 65,” it says, “the early retirees have a 37 per cent higher risk of death than counterparts who retired at 65. The risk of dying was about 80 per cent greater in men than it was in women.”

THE DEAL: Read more from The Australian’s business magazine, July edition out tomorrow.

An ongoing research project by the National Institute on Ageing in the US found that “retirees who worked a year longer (over the age of 65) had an 11 per cent lower all-cause mortality risk. Even the unhealthy group reduced their likelihood of dying by 9 per cent if they delayed retirement.”

The good news is that more than 60 per cent of people who get there do enjoy their retirement.

But for many CEOs and chairs, the end of their last gig is very traumatic. Some never get over it. The first problem is that it’s a clear signal that you’re not going to live forever. As someone has doubtless said before, life is like a half-built rollercoaster: you keep going up for a long while and then you rush down to the end. A big career and all the trappings can be like billboards that stop you seeing the end until it’s too late.

The second problem is relevance. To go from constantly being asked your opinion, flattering media profiles and speeches at international leaders’ clubs, to a non-event can lead to a struggle for relevance. As president Harry Truman said on stepping down: “Two hours ago I could have said five words and been quoted in every capital of the world. Now, I could talk for two hours and nobody would give a damn.”

Most CEOs and chairs can distinguish between real friends and people who want a relationship for commercial reasons. But it can still come as shock when the phone stops ringing. Of course it’s harder if you are a narcissist. (Not that there’s anything wrong with that - an employee of Oracle CEO Larry Ellison is reported to have said: “The difference between God and Larry is that God does not believe he is Larry.”)

Speaking at the 2013 launch of a study into narcissism as a leadership trait among CEOs, Macquarie Graduate School of Management dean Alex Frino said: “Narcissist leaders can inspire others and are very effective in situations where you need change and creativity.” But they need constant validation and praise. When the job ends, most of that drops away.

The reality is that for successful executives, retirement comes as a shock. You run the risk that all you have built will be discarded by your successor. And you probably haven’t put as much thought into it as you should — if you had run your company the way you have prepared for your retirement, you would have been forced into retirement a long time ago.

In a wonderful paper on retirement Manfred Kets de Vries, clinical professor of leadership development at INSEAD, wrote: “Loss of status, loss of recognition, loss of income — the connotations of letting go can seem overwhelmingly negative. It is clear that the problems of retirement syndrome have to be addressed on both the individual and organisational level. Organisations are notoriously negligent in this regard.”