CPD: The retirement roadmap – helping clients navigate the stages of retirement

Advisers need to be able to help their clients understand and navigate the six stages of retirement.

Retirement marks a truly significant transition in one’s life, representing the culmination of years of hard work, diligent saving, and careful financial planning. This period is far more than just the end of a career; it is a profound pivot point.

While retirement is often eloquently described as a journey, it is critical to recognise that this journey does not simply conclude with the cessation of formal employment. Instead, it evolves dynamically into a complex new phase of life that demands careful navigation to ensure a client’s continued wellbeing, fulfillment and importantly, financial security.

Beyond merely focusing on traditional investment and financial management, comprehensive retirement planning must encompass a broader spectrum of emotional, social and psychological considerations for each client. In this expanded context, the role of a trusted financial adviser naturally transcends traditional investment strategies and extends deeply into providing holistic support for the client’s overall life wellbeing.

As individuals initially enter retirement, they frequently find themselves grappling with a myriad of uncertainties and necessary adjustments. Pressing questions about future lifestyle changes, evolving health needs, maintaining social engagements, and, critically, their sustainable spending capacity, all demand immediate and focused attention.

In this unfamiliar and often challenging landscape, skilled financial advisers instinctively become trusted and indispensable guides. Their support spans from fostering a comprehensive understanding of all available financial resources through to providing crucial emotional support during these major life transitions. Advisers, therefore, play a pivotal role to empower retiree clients to lead genuinely fulfilling and self-directed lives.

Despite how it is often portrayed, retirement is anything but a single, monolithic event. Those who are actively living through it – as well as their financial advisers – know this reality. It has been established through research dating back to the 1980s^[1], and since ratified by more recent, thorough studies, that retirement comprises distinct and identifiable stages. Each one of these stages possesses its own unique characteristics, presents its own specific set of challenges, and requires a tailored advisory approach. Furthermore, the exact amount of time a client spends within any given stage is highly unique to them, varying significantly depending on a wide range of individual personal and financial factors.

The comprehensive cycle begins with the preparatory stage, known as pre-retirement, which leads into the second stage: the actual retirement event itself, whether that occurs as a carefully planned or an unexpected transition. This momentous shift is then traditionally followed by the initial honeymoon period of retirement, which can then give way to a period of disenchantment as the new reality sets in. This is then followed by a necessary reorientation period. Finally, the retiree reaches the settling stage, establishing a new sustainable routine and pace of life that will continue to evolve and adapt throughout the rest of their retirement years.

Stage one: Pre-retirement

The first phase in the retirement process, as identified by scholars such as Robert Atchley^[1], is the pre-retirement stage. This is far more than simply being the final years of employment; it is a vital, intentional period of transition where individuals begin the essential, gradual process of mentally and practically disengaging from their professional lives.

During this time, clients actively start to envision and map out their post-employment existence, moving beyond vague aspirations to taking concrete steps toward comprehensive financial, emotional and logistical readiness. A key component of this preparation often involves exploring formal strategies, such as a ‘transition to retirement’ strategy, designed to ease the shift from full-time work to a new life structure.

It’s also a time when clients may feel the first flutter of fear about their retirement funding. FORO – the fear of running out – is real. Years of inflation coupled with more recent market volatility have reinforced the notion that while people may live longer, there’s no guarantee their retirement savings will stretch that far.

Therefore, at this pre-retirement stage, your role as a trusted financial adviser is paramount. An adviser’s mandate is to guide their clients through a complex myriad of decisions, all aimed at laying the robust groundwork for a secure, comfortable and fulfilling future. This advisory work begins with a thorough and comprehensive assessment of the client’s current financial standing against their anticipated future retirement needs. This assessment must consider the specific income stream required to meet the client’s lifestyle objectives throughout what may be an extended retirement period.

A core component of your value here is to provide clients with an unambiguous and clear understanding of their financial position. By quantifying their current standing and projecting future requirements, you can empower your clients to make fully informed decisions and take proactive steps to bridge any identified gaps between their existing assets and their desired retirement lifestyle.

With increased longevity now meaning retirement may span twenty-five years or more, careful planning is crucial. To provide clients with a strong certainty of income across this extended duration, it is essential to lock down decisions about sustainable income generation during the pre-retirement stage, which includes a detailed consideration of the most suitable retirement income products.

For many clients, the focus shifts to ensuring reliability. Products that offer the certainty of a guaranteed lifetime income, ideally coupled with reasonable access to capital and some form of capital protection, can provide substantial peace of mind as they approach the official end of their working careers. You must expertly weigh the client’s risk tolerance, longevity projections, and income needs to select and implement solutions that maximise financial security while minimising worry. This income planning is the bedrock upon which the entire retirement structure is built, making this stage the most financially intense part of the advisory relationship.

However, the guidance offered in the pre-retirement stage extends far beyond pure financial planning. You can also assist clients to create a structured retirement master plan that intentionally encompasses not only quantifiable financial goals but also personal aspirations and desired lifestyle preferences.

This holistic planning might involve reviewing optimal healthcare and insurance options, as well as collaboratively devising plans for future leisure activities, extensive travel, or meaningful volunteer work. By delivering a tailored retirement plan that aligns precisely with each client’s unique needs and aspirations, you help foster a crucial sense of purpose and fulfillment in the pre-retirement phase, thereby ensuring a smooth, confident transition into retirement and laying the strongest foundations for a secure and satisfying future.

Stage two: The ‘Near’ phase

The Near Phase is the stage immediately surrounding the actual cessation of employment, often referred to as the ‘retirement event’. Ideally, this event is the culmination of years of planning and anticipation, signifying a significant and welcome life transition characterised by freedom and leisure. However, in less ideal scenarios, clients may be forced into retirement due to unforeseen and unplanned events.

Planned retirement

For clients with a structured transition plan, this phase involves finalising financial arrangements. This typically includes setting up income streams from superannuation funds and retirement income products to ensure the client’s desired lifestyle is maintained. Your guidance is essential here for factoring in critical risks such as inflation, market volatility, as well as longevity and sequencing risk.

Unplanned retirement

Unforeseen events can significantly impact a client’s readiness. Of the 156,000 Australians who retired in 2024-2025, 13 percent left work earlier than planned due to sickness, injury or disability and six percent found themselves retrenched or dismissed and unable to find alternative employment^[2].

Your role is critical when it comes to helping clients navigate these unexpected challenges. This involves providing guidance on contingency planning and evaluating appropriate insurance coverage. Clients benefit greatly from the early implementation of flexible retirement income strategies, which better position them for an unplanned exit from the workforce.

The retirement event brings a host of complex financial, emotional and logistical considerations. Beyond the technical financial strategies, you may find yourself providing emotional support and reassurance during times of uncertainty, helping clients adapt to their changing circumstances while staying focused on their long-term financial goals.

Stage three: The honeymoon period

The honeymoon period immediately follows the retirement event, marking a period of newfound freedom and intense relaxation where clients actively savour the fruits of their labour by engaging in desired activities. This period is often characterised by travel, hobbies and anything that brings your client enjoyment.

The duration of this phase is highly individual, potentially lasting anywhere from six months to several years, as each client’s unique experience and enthusiasm determine its length. Despite the initial euphoria and high activity level, this time requires clients to maintain a critical sense of financial stewardship to ensure their new, active lifestyle is financially sustainable over the long term.

Your strategic guidance is indispensable here; you can help clients enjoy this stage without inadvertently depleting their assets through overspending. A key action is to establish a sustainable spending plan that aligns their desires (discretionary spending on travel and entertainment) with their reliable retirement income, while firmly securing essential needs like housing and healthcare.

This period is also crucial for optimising investment portfolios to manage risk and returns, as significant market drawdowns early in retirement can severely jeopardise long-term financial outcomes. By providing this guidance, you enable clients to maximise their enjoyment and freedom while they are young and in good health, without compromising their future financial security.

Stage four: Disenchantment

Fortunately, this phase does not affect all retirees, but for those it does, it typically follows the initial excitement of the honeymoon period. This stage is marked by a letdown when the reality of retirement fails to meet earlier, often idealistic, expectations. Common symptoms include feelings of boredom, isolation, anxiety and disillusionment. These feelings are often provoked or exacerbated by financial concerns or the loss of the structure and social identity provided by work.

In this challenging period, your role often extends beyond financial oversight to become a holistic guide helping the client reconnect with purpose and stability. If a client does become disenchanted, a fundamental step is to initiate a comprehensive reassessment of the client’s current situation and their initial retirement goals.

At the same time, you can conduct an open and non-judgmental conversation to gain insights into the client’s sources of dissatisfaction. What is and isn’t working? Does the disenchantment stem from financial anxiety or non-financial factors?

This provides you with an opportunity to help your client readjust their priorities and expectations. This might involve revisiting the financial plan, adjusting the spending plan to alleviate monetary pressure or confirming that the current plan is robust, thereby assuaging anxieties. The goal is to move your client from generalised dissatisfaction to actionable steps.

Where disenchantment stems from a loss of purpose, you can facilitate solutions by exploring avenues for personal fulfillment and engagement that lie outside the financial portfolio. You could discuss potential structured activities such as a return to part-time work or consulting or pursuing volunteering opportunities that align with their personal values. Both options can help provide your client with a sense of meaning and contribution.

By encouraging clients to cultivate and maintain a strong sense of purpose and structure in their daily lives, you provide essential support that supports your client to transition out of disenchantment and move towards the next, more stable stage of reorientation.

Stage five: Reorientation

This phase follows the potential emotional dip of disenchantment. It is a period where clients, having recognised that their initial retirement assumptions or expectations were perhaps a little flawed, begin to construct a new, more realistic and satisfying lifestyle. This involves questioning their post-retirement aspirations and making deliberate lifestyle choices that align with their needs and long-term financial reality. While proactive engagement in comprehensive retirement planning well in advance of the retirement event can significantly mitigate uncertainty and facilitate a smoother transition into this phase, you can also play an important role in guiding this recalibration.

The core task during reorientation is helping your client cultivate a new sense of purpose and direction in their post-work life. You can do this by engaging clients in a deep exploration of their interests; the activities, relationships or causes that provide genuine meaning and fulfillment. Although this ideal exploration begins years before retirement, it must be revisited and adjusted throughout the retirement lifecycle to ensure the client’s current lifestyle remains aligned with their evolving personal and financial objectives.

By skilfully integrating financial projections to ensure sufficiency and sustainability with lifestyle preferences, you can assist clients to make informed, deliberate decisions that actively support their long-term personal and financial wellbeing and sense of fulfillment.

Stage six: Stability

Sometimes referred to as the ‘Routine Phase’, stability is the stage where retired clients finally settle into a predictable rhythm of life that reflects their preferences, interests and core values. For some, this routine is established soon after leaving full-time employment; for others, it may only solidify after navigating the other earlier stages of retirement.

This stage is typically the longest, often lasting many years, and provides your clients with the enduring opportunity to fully embrace the lifestyle they have worked to envision and create. Even during this settled period, your role retains importance. As clients become comfortable in their routines, their financial needs and priorities continue to evolve, even if only incrementally. Importantly, this stage often sees the emergence of health issues, which can necessitate a reassessment of living arrangements (such as downsizing or moving to aged care) and a significant adjustment to required medical expenses.

A thorough review of retirement goals, income sources and spending patterns is fundamental to ensure that each client’s financial strategies remain aligned with their long-term objectives. Regular check-ins allow you and your client to make necessary adaptive adjustments as new opportunities or challenges arise.

Whether your client decides to pursue a new, costly pastime, undertakes an extended travel plan, or is suddenly faced with unexpected medical expenses, you can offer the essential guidance and support to adapt the retirement plan accordingly, therefore preserving both the client’s financial security and their peace of mind within their established routine.

Ultimately, the stages of retirement confirm that retirement is a complex, multi-faceted journey, not a singular financial event. For the modern retiree, the financial adviser is far more than a manager of assets; you are a continuous partner in life planning. Your role will dynamically shift across the stages: from the crucial tactical setup of income streams and risk mitigation during the near and honeymoon phases, to acting as a vital sounding board during the potential psychological struggle of disenchantment.

You provide the necessary structure for successful reorientation, helping your clients to define new purpose and recalibrate their expectations. By ensuring that financial stability consistently supports evolving lifestyle choices and personal fulfillment throughout, you can provide your clients with the structure and objective guidance necessary to not just fund their retirement but live it with confidence and meaning.

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Notes:
[1] Robert C. Atchley, Retirement as a Social Institution, Annual Review of Sociology, Vol. 8 (1982)
[2] ABS, Retirement and Retirement Intentions, Australia, 2024-25 financial year, October 2025

This material is issued by Allianz Australia Life Insurance Limited, ABN 27 076 033 782, AFSL 296559 (Allianz Retire+). Allianz Retire+ is a registered business name of Allianz Australia Life Insurance Limited. This information is current as at December 2025 unless otherwise specified and is for general information purposes only. It is not comprehensive or intended to give financial product advice. Any advice provided in this material does not take into account your objectives, financial situation or needs. Before acting on anything contained in this material, you should speak to your financial adviser and consider the appropriateness of the information received, having regard to your objectives, financial situation, and needs. No person should rely on the content of this material or act on the basis of anything stated in this material. Allianz Retire+ and its related entities, agents or employees do not accept any liability for any loss arising whether directly or indirectly from any use of this material.