On my wedding day, I worked in the morning, got married at noon in Probate Court and then ventured back to the office to work in the afternoon. One of my colleagues mercifully posted a big “L” on the door of my office that day, and I got the point. I left work and celebrated my wedding day.
I wonder if I’ll repeat that banality on my final day on this earth? I seem to be heading in the direction where I’ll work the morning of the day of my funeral.
At what point in the lives of estate planners does the “L” need to be posted on our office door with the note next to it, “Ever think of Retirement?”
For estate planners, “Done” (as in retired) is a 4-letter word we push off until our other graduation day, the not-so-welcomed one.
Unlike other areas of the law, estate planners can’t really retire, or retire easily, because our clients need us for as long as we’re around. And, we like our clients, our practices, our wisdom, our respect and our importance to those with whom we’ve worked for and alongside.
With this in mind, what do we do? We don’t want to be thinking, “Oh, I should have retired a bit ago,” as we’re circling the mortality drain.
Like the planning we do for clients, we need to develop heuristics as to how to approach retirement.
Status Quo Bias
Behavioral economists talk about the status quo bias, the concept that we’re loathe to take actions even when not doing so interferes with rational financial decision making.
In work, if we promised clients drafts of documents by Friday, and Friday rolls around with no chance the clients will receive the documents, what do we do? Often, we may ignore the promise, hope the clients forget (they won’t), not want to face the music and say nothing when Friday rolls around. Compare that approach with a 15-second-to-comprise email to the clients that says, “Sorry not to have the documents to you today, but couldn’t quite finish the drafting. Will have them to you next week.”
That email is a win-tie in terms of client reaction, and in all events better than sending nothing. And yet, most of us won’t always send the email. Status quo, doing nothing, is much easier even though not rationally financially maximizing.
The same status quo bias exists in our view towards retirement. At age 50, we know that we won’t be able to work with the same drive, the same mojo, the same energy and the same stamina at 65 as we do now. Are we doing anything today to address it?
Usually we’re not: “I’ll deal with that topic as soon as I finish organizing my photos, music, passwords, accounts and accumulated stuff in my house.”1
Partial Retirement?
Isn’t this the typical assumption: Once I retire, I’m done. No more will or trust discussions for me. No more reading Trusts & Estates. I won’t be doing anything work related.
Part of that conclusion is based in good logic, and part is based on mental loafing.
On the mental loafing, many of us don’t realize there are alternatives to completely stepping out of the estate-planning area.
On the good logic, the estate-planning profession demands constant learning, attention and focus on detail. Estate planners need to be well versed, evolutionary, focused and always mindful of changes in the law and changes in best practices.
It’s scary to think that we could be as smart as we are if we’re only 50 percent involved, as in working three out of seven days a week.2 When we think of partial retirement, we can’t imagine being involved only 50 percent of the time we work and, therefore, dismiss this alternative to working full time.
Let’s examine this prototype, the four on, three off, in more detail to fully understand its practicality and how to get there.
The “4-3 Model” and Its Progeny
Let’s assume that as with most estate planners, you’re available daily to address urgencies. In the estate-planning world, they occur daily, as we know. They also crop up at 2 a.m., on Saturdays and Sundays, and in the middle of meetings. I’ll often get texts that say something like: “Sorry to bother you [at 1 a.m.], but I really need to talk to you.”3
We can assume that in your new phase, you may not want to be on call seven days a week and in the early morning hours. The starting point is then to define what your work schedule will look like.
As an example, a pleasant transition could be to a 4-day work week, no evenings and no weekends, what I refer to as the “4-3 Model.”
Until you define the boundaries of your work life, there’ll be no boundaries.4
And, if there are no boundaries, there’s no purpose in planning further.
Therefore, let’s assume you’ve defined the boundaries, and, for illustration purposes, those fences5 are as noted above, four days on, three days off.
Intersection of Hope and Reality
If you look at email or texts seven days a week or answer phone calls during this period, you won’t be able to do the four days on, three days off protocol.
If an emergency arises during the three days off, and you haven’t obtained coverage to handle emergencies, you won’t be able to adhere to the protocol.
Therefore, you must take steps, like the following, to be able to get away from “Hope,” that is, “Gee, I hope no one calls me the three days I’m not working. I hope nothing bad arises. I hope life is pleasant and the Middle East has worked out their conflicts during those three days”—and move into “Reality,” that is, “You need a copy of your power of attorney within the next five minutes? Well that’s no problem. Lou is out, but you and I have worked together, and I can get that to you.”
Step 1: Identify, update and make a list of all of your clients. We should be doing that in any event. But, no doubt we fail a bit on this part.
As a sub-step, divide that into three categories: those clients you like (should be 90 percent), those you can’t remember (we’re getting old, aren’t we?) and those that are the epitome of evil. Probably a good idea not to worry about transitions with regard to the last category. In fact, perhaps an exit before transition would be a good step.
Step 2: Recognize that no one can provide the level of service and thought that you’re providing. Recognize also that though you look in the mirror and see your 30-year-old self, your clients see the actual
60 year old you are. They’re already wondering who’ll take over when you’re being sucked down the drain.
The reality is that you need to select a successor and get her involved. Yes, your chosen successor won’t do planning as well as you, but may actually do it better.6
Step 3: You need to have competent people on your team and start matching up your clients with your successors. Spend time with those people, and if they’re not already in your practice, start hiring them.
Step 4: Identify when you want to start working less. You’ll need a one-to-five year runway.
Step 5: Start drafting the letter to clients that will give them the good news: that you won’t be retiring, but will be slowing down.
Step 6: Before sending the letter, start involving your successor on your client matters. We should have been doing this from the get-go, but then again, perhaps we should have studied more for the ACT?
Step 7: Make the plan a reality. This is the hard part. This is where good intentions run smack dead against the status quo brick wall. We need a catalyst, an instigator, a match that lights our retirement candle.7
Test the Hypothesis
Establish a time away, or times away from the office, when you’ll be without email, text or communication. How about a month in Siberia?8 Target that date: one year from now, two years from now? By that time, all your clients must be transitioned, because you’ll have no communication ability.
When the day comes, let ’er fly. You’ll have let your clients know beforehand. But, once you’ve gone on that month vacation, that two month sabbatical, you’re really gone.
When you come back, your clients will still be there (mostly), but many will have gotten used to working with others. You’ll have demonstrated that you can be unplugged. And, there will have been coverage.
When you come back, you can now free of guilt, free of doubt and free of needed transition, switch to your 4–3 Model.
A New Phase
We don’t want the “L” on our office door the day of our wedding, and we don’t want the “L” on our door the day of our demise.9 As with forest fires, only we can prevent the “L” from occurring. Take the steps, continue the practice of law and enter into a new foray in your practice in which you can be in, and out, pursuant to a schedule that allows you to experience life and law in a new way.
Endnotes
1. “I do wonder if I’ll ever use that outfielder’s mitt again. It was really excellent when I played left field, a few years ago, when was that? 10? 20? But, someday I’ll get back out there.” Moral: Hard to throw away stuff.
2. Here’s my theory on our intelligence. At about age 40, there are two intelligence variables, moving in different directions. First, there’s “knowledge depreciation” daily. This occurs because by age 40, our brains have reached capacity, and information regarding the identity of all goals scored by Patrick Kane have consumed that capacity. As new knowledge comes in—you know, that important stuff from the news and twitter, it forces the old knowledge out. Concurrently, at age 40, we’re working even harder to develop new knowledge in the estate-planning area. For a while, post-40, the net effect is that new knowledge is greater than the depreciating and evaporating old knowledge. But, the tide turns at some point to the negative.
3. My head on the pillow needs to talk to me more at that time of the day.
4. That could be one of the most unintelligent comments I’ve ever made. But, unintelligence doesn’t subtract from the veracity of the point.
5. In our current political environment, fences are a fun topic, aren’t they?
6. Same problem as the mirror. We aren’t 30 when our age is 60. And, we’re not the most brilliant planner out there, though we may think otherwise. Irrational elevation of our self-importance, like the status quo bias discussed in the article, is another one of those behavior finance biases most of us have.
7. Preferably that match isn’t bad news from your doctor.
8. Go for a longer multi-month sabbatical. What have you always wanted to do but haven’t? Do it now, pre-retirement.
9. Even if I’m not then here, I’ll be spiritually here, and my spirit won’t like to see that “L.”