A happy retirement is more than just money

Reports of Americans being unprepared for retirement have become so widespread that it no longer seems to elicit any emotional response.

The Employee Benefit Research Institute found that 40.6 percent of all U.S. households (where the head of the household is between ages 35 and 64) are projected to run out of money in retirement. Moreover, the average Social Security benefit provides an income equivalent to the poverty level for a family of four.

Daunting numbers indeed, but these conditions speak to priorities undertaken years earlier. Many families would list education as their No. 1 goal, and given the exorbitant cost of college tuition, it only makes sense that their nest egg is less than robust.

This is an important distinction to make, that insufficient retirement savings could be more a function of conscious decisions made in the past than a failure to behave responsibly.

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Furthermore, saving for retirement is not as easy as advertised.

Glossy financial planning brochures with couples in their mid-50s riding a sailboat notwithstanding, this is simply an unrealistic expectation for many households. Given our increasing life expectancy, accumulating enough money in 35 to 40 years of working to sustain us for the remainder of our lives is no easy task.

To put this into perspective, if you take out 5 percent from a diversified portfolio each year, you stand a 58 percent chance of running out of money within 30 years of retirement.

After all, anyone taking withdrawals during the 2008 housing crisis would have a dramatically different outcome than investors who retired in 2009 and lived off market returns in the beginning of retirement. Volatility matters. This would suggest that you need $2,000,000 saved to generate $100,000 in annual income.

It's also worth mentioning that distributions from retirement accounts are subject to ordinary income taxes. In other words, there's a fair chance that a great many savers — unless they make lifestyle sacrifices or wiser investment decisions or have an actual pension — won't be able to maintain their current quality of life once they leave the workforce.

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However, for many retirees, saving enough for those golden years is only part of the formula for a good retirement.

The key to achieving an active, satisfying and happy retirement involves more than having adequate savings. It also entails interesting leisure activities, creative pursuits and mental and physical well-being.

Fortunately, there are a number of viable solutions that might address any financial shortfall, including working part-time at something related to your profession. A teacher, for example, might begin a tutoring service and accumulate innovative metrics that validates his or her approach. A scientist may decide to teach an online class at a community college two days a week.

In lieu of brick-and-mortar offices, entire new job niches are being created online with Twitter handles and YouTube channels, so it pays to get creative. Many of us have hobbies or passions during our working careers that can provide both supplemental income and access to a social network of likeminded people.

"Success in retirement can be defined as waking up in the morning and going to sleep at night and doing exactly what you want in between." -Ivory Johnson, founder of Delancey Wealth Management

If you enjoy gardening, consider working part-time at a nursery a few years before leaving your job. Those who prefer bike riding can create a personal training regiment, teach novices about biking and lead groups through trails for a fee.

During the planning phase, you have time to complete any license requirements and build relationships with business owners and centers of influence. Some of us may even consider moving to a state with a lower cost of living. Perhaps renting out and depreciating your residence in a high-cost state subsidizes the mortgage in one with lower income taxes; sometimes it just takes a little imagination.

If meeting new friends in retirement or after relocation is uncomfortable for you, plan a vacation or getaway with three or four other couples who find themselves in a similar financial predicament: reasonable Social Security benefits, a little home equity and not enough savings.

Success in retirement can be defined as waking up in the morning and going to sleep at night and doing exactly what you want in between.

Write down exactly what you want your life to look like during retirement, and develop a plan to make it happen. You might be surprised to learn that retirement planning has more to do with "what you'll be doing" than "how much you'll have to do it with."