You know what they say about practice -- it makes perfect.

So it's not surprising that, in an era that offers so many ways to screw up your golden years, "practicing retirement" is becoming a more common strategy.

"Many people haven't saved enough to retire, so they are anxious because they realize they will have to keep working in their 60s when they had hoped that they would be having fun," explains Christine Fahlund, a senior financial planner with T. Rowe Price. Don't panic, she says: Instead, practice.

Simply put, practicing retirement is a way to dip your toe in the retirement waters and see if they're too hot, too cold, too "just not you yet," or just right. Are you really ready financially -- and emotionally? Where are the gaps in your plan?

"The best thing about practicing retirement, it's not the Super Bowl. If you drop the ball, you pick it up and try again," says Fahlund. The goal is to figure it out in your 60s, so you're set when you fully retire by 70.

Giving Yourself More Time to Prepare

So what does a retirement tryout look like? Much of that answer will depend on your needs and goals. However, first, it's likely you'll need to come to grips with the notion of delayed -- but not denied -- retirement.
Generally, assume that you are going to keep working through your 60s -- though perhaps part-time. If you do have to keep up the full 9-to-5 routine, then take comfort from the fact that, in practice retirement, "your attitude about work will be different if you're also doing fun things," says Fahlund. Because full retirement is delayed, she explains, you can take your foot off the savings gas pedal a little bit, and use that money to explore some of the things you have in mind for later.

"Maybe you envision spending your days sailing -- buy the boat now while you're working," says Fahlund. "You want to pay off big ticket items before retirement. Take some trips and see if it's indeed what you want to do." You'll have more discretionary income during these transition years to start seriously pursuing your retirement aspirations well before you might have expected, she adds.

Working longer is the real key to the practice retirement formula. Those extra years of salary -- even if only part-time -- are critical. And working longer pays off emotionally as well: "You stay sharp, lively," she adds.

The Benefits of Delayed Gratification

The hallmark of practice retirement is balance: between working and playing, spending and saving. Beyond that, there are a few tenets at the heart of the strategy:
  • Keep working, full or part-time;
  • Don't touch your nest egg;
  • Delay taking Social Security benefits;
  • Keep invested in a diverse portfolio (you can stop contributing to your retirement plan, though you may want to continue to do so, at least up to the amount that qualifies you for the employer's match).
It's not hard to see the sense in this. By continuing to work and postponing the day you start receiving Social Security benefits, you position yourself for higher payments for the rest of your life, points out Fahlund. Every year you wait to take Social Security benefits, they increase about 8% (in today's dollars) -- almost doubling in purchasing power by age 70. And because the increases are based on government formulas and not investment returns, they are not impacted by market conditions. For a better idea of how practice retirement scenarios can play out, check out this chart and other information from T. Rowe Price..

On the Road Again ... And Again

Doreen Orion and her husband literally did a test drive of retirement. "My husband came home one day and out of the blue announced he wanted to 'chuck it all' and travel the country in a converted bus for a year. Neither of us had ever stepped foot in one, or in an RV." They are both physicians, specializing in psychiatry. "I demanded to know, 'Why can't you be like a normal husband in a midlife crisis and have an affair or buy a Corvette?' " recalled Orion.
She told him she'd never do it, but she relented, and she's glad she did. They traveled from the summer of 2004 to the summer of 2005. She worked part-time during that year, doing insurance review work -- all she needed was Internet access and a telephone. Since then, they've spent a couple of winters away on the bus. Every time they came home to Boulder, Colo., "we were seriously bummed," says Orion, who like her husband is in her early 50s.

They tasted retirement, loved it, and have put their house on the market, so they won't have the expense of a mortgage.

"It's far cheaper to live in an RV," says Orion. "There is a huge shortage in our specialty all over the country. We can each just go somewhere for a month or so, work in a hospital or clinic and leave. I don't know how long we'll plan to be on the road. I have no idea where we'll go, but we'll stay in a place for a few weeks. If we like it, we stay longer. If we don't, we just pull up stakes."

At this point, the couple has no target date for full retirement. Once their house is sold, they will work very little, perhaps 10 hours a week each while on the road -- just enough to meet their minimal expenses and to avoid having to tap the proceeds from the sale of the house.

"One of the things we loved most about life on the road was, unlike our regular lives, nothing had to be planned," she said. "We had so many wonderful adventures, but even the misadventures -- fire, flood, armed robbery and finding ourselves in a nudist RV park, just to name a few -- enriched our lives. We never knew what the next day would bring."

It also taught her new priorities: She put aside her passion for fashion. "I realized I no longer wanted to support a lifestyle. I'd much rather support living a stimulating life and getting to spend time with the person I love on a constant adventure. I no longer go to the mall," says Orion. Her new love is writing: She wrote about their adventures in her book, Queen of the Road.

'I Felt My Mind Turning to Gelatin'

Willi Rudowsky, 63, says she didn't know she was "practicing retirement" when she quit her job at Williams-Sonoma (WSM) in San Francisco 11 years ago and moved to St. Petersburg, Fla. "But that's exactly what I did," says Rudowsky, "And, I didn't like it. The yoga, bike-riding and volunteering just didn't work for me. I felt my mind turning to gelatin." Though she loved being able to schedule trips without having to ask her boss for time off, the lack of structure bothered her.

Three years into her "new life" she went back to school, started taking courses, liked it so much that she kept going until she got a master's degree in journalism. She now works part-time, handling customer service issues for Poynter's News University. That leaves plenty of time for Rudowsky and her husband to support local theaters, music venues, museums and serve on their condo board, among other things.

"I'm in no hurry to stop working," she says. "I don't do it for the money; I do it for the intellectual experience. When I fully retire in three years, I will exercise more, travel more, maybe travel to Calcutta. I don't believe I will run out of money before I run out of life. I will gradually replace my job with more of what I am doing outside of work now. I worked out all the kinks in my practice retirement, so I will -- I hope -- just slip into it."

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May 19 2011 at 7:12 PM Report abuse rate up rate down Reply

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May 19 2011 at 11:13 AM Report abuse rate up rate down Reply

First, this article makes the assumption that you will be ABLE to work through your sixties...self employed, not laid off or downsized, no health issues, no caregiving, have money to go back to school, or are "hireable". Most are not. It ignores the idea that, by sixty, you probably have already worked a good 45 years, and statistically probably have only 20 years left, if you are lucky, Your body is naturally starting to break down, good nutrition, exercise or not.It is impossible to live on Social Security alone. It pretty much only covers your medicare and the supplemental parts you have to buy to keep them from taking your bank account if you get sick. The most important thing about retirement is figuring out how to face the toughest challenge of your life: finding intrinsic happiness with very little money, a body that will fail you, the dwindling of your longest known friends, and having very few others, if any, who care. But it can be done, so buck up and just be thankful you're still here.

May 19 2011 at 10:15 AM Report abuse rate up rate down Reply

Wall street and the Bankers dipped into lots of retirement plans, Amazing times.

May 19 2011 at 12:59 AM Report abuse rate up rate down Reply

We may be ok. If interest rates ever get back to 5%, and they will, we are looking at a retirement income of about $15,000 per month, $180,000 annualy. 3 pensions, 1 annuity, and SS times 2. If a couple crap out, then maybe $120,000. Thing is, we never spent $120,000 a year when we were younger and "acquiring". But, who knows. We tried hard.

May 18 2011 at 6:56 PM Report abuse -1 rate up rate down Reply

Ah yes, the golden years. I still haven't quite figured out what the Golden Years are. Don't plan on doing all the things you wanted to do before you retired, you won't have the energy. Don't make to do lists, that's a mistake. Take it one day at a time. Be spontaneous. Don't look at the clouds, look right through them and see that beautiful sunrise and sunset that you would otherwise miss. Retirement doesn't make you, it gives you the chance to give meaning to the word. Never stop looking for that pot of gold at the end of the rainbow.

May 18 2011 at 4:59 PM Report abuse +1 rate up rate down Reply

Let me put it this way---GOLDEN YEAR'S MY AUNT FANNIE!!!!!! More like GOLD PLATED and will tarnish fast.
Social Security is a joke. Would be fine if the thieving govt. had left the money there and not used it over the years as a slush fund. AND NOW, give it to every illegal Tom , Dick and Jose that comes down the pike.
If I ran my household like the govt. has for many year's,I couldn't afford to pitch a pup tent in my daughter's back yard.
Not against govt. , just BAD GOVT.!!!!!!

May 18 2011 at 12:09 PM Report abuse +1 rate up rate down Reply
1 reply to woodscrawler2's comment

The government did not steal the money, it's all still there. SS is secure until 2037, and even after that it can be self sustaining if the maximum income level is raised a small amount. And NO, illegals cannot receive Social Security, even if they paid into it when they were working here. You must be a citizen or legal resident to collect. Stop watching Faux News, they are mushing up your brain.

May 18 2011 at 4:03 PM Report abuse +2 rate up rate down Reply

This is the most ignorant story ever written.

May 18 2011 at 11:41 AM Report abuse +2 rate up rate down Reply

Wait until 70 to get social security? If you collect at 70 instead of 66, you have to wait until 80 to break even. If you drop at 71, your whole lifes contributions are retained by your government. Or excuse me you get a one time $255 death benefit. Take the money & run..........

May 18 2011 at 10:00 AM Report abuse +4 rate up rate down Reply

Retirement becomes what you make of it but obviously starts with can you afford it. Based on your health, etc, you should decide when to take social security not when it pays you the most. It doesn't do much good if you are not here to enjoy any of it. Recognize that there are bumps along the way, don't plan for them but plan for smoothing out the bumps and go for it. I retired at 55 partly due to cancer but now 13 years later am enjoying life, volunteering, playing golf, traveling and doing all those things you hope to do in retirement. Look at your health, your family and you finances and then jump of the side of the cliff if you can!!!

May 18 2011 at 8:03 AM Report abuse +4 rate up rate down Reply
2 replies to MR H's comment
Judy & Garry

Cancer would make us all take stock of our lives, and I feel for you, but what were you, a business owner, a teacher or government employee? Most of the proletariat in the private sector would find it difficult if not impossible to retire at 55 without experiencing deprivation. If you are enjoying volunteering, golf and traveling, then you've got yours. Good for you. In many cases if you were diagnosed with cancer, your employer would dump you as soon as they could without a lawsuit.

May 18 2011 at 3:17 PM Report abuse rate up rate down Reply
1 reply to Judy & Garry's comment

HEY Y'all...I wasn't any of those, but a middle manager who did the smart thing and lived within my means. Raised two great kids, sent both to college and then put as much into savings as possible. Cancer surgery worked and I am now cancer free and thankfully I am enjoying life as best I can. You can make do if you plan, ifyou wait for someone to "help" you retire you are going to have a very very long wait.

May 18 2011 at 5:43 PM Report abuse rate up rate down
Judy & Garry

Cancer would make us all take stock of our lives, and I feel for you, but what were you, a business owner, a teacher or government employee? Most of the proletariat in the private sector would find it difficult if not impossible to retire at 55 without experiencing deprivation. If you are enjoying volunteering, golf and traveling, then you've got yours. Good for you. In many cases if you were diagnosed with cancer, your employer would dump you as soon as they could without a lawsuit.

See full article from DailyFinance:

May 18 2011 at 3:23 PM Report abuse rate up rate down Reply