By Michael Watkins and Chris Donkin
Having led others for so long, executives close to retirement often struggle with the prospect of leaving and slowly fading into the background. In this guide, Michael Watkins and Chris Donkin outlined how senior leaders can plan, prepare, and even look forward to a fulfilling life after retirement.
When Reed Hastings announced his departure as CEO of Netflix in January 2023, his succession felt natural and even inevitable. The same was true when Jacinda Ardern stepped down as Prime Minister of New Zealand that same month. Both transitions appeared effortless, but such smooth handovers are rare. Most senior leaders struggle significantly with the decision to step down, often holding on long after their optimal departure date.
If you’re a senior leader contemplating retirement, you are likely facing this struggle firsthand. Your challenges are more complex and nuanced than most succession literature suggests. Through our research and extensive work with retiring executives, we have found that the barriers to a successful transition are primarily psychological rather than practical—and addressing them requires a deep understanding and strategic action.
Understanding the inner struggle
The psychological barriers to retirement run far deeper than most leaders initially recognize. These barriers are not merely professional concerns but profound psychological constructs built and reinforced over decades of leadership. They are intricately woven into the fabric of one’s identity, self-worth, purpose, and mortality. Understanding these barriers and acknowledging their power is the crucial first step toward navigating a successful transition.
The Identity Paradox
The traits that propelled you to leadership and sustained your success can become significant obstacles in recognizing when it’s time to step down. Determination, resilience, unwavering commitment, and the ability to overcome challenges have defined not just your leadership style but your entire approach to life. The cognitive dissonance becomes fundamental: how can stepping away be the right choice when persistence has always been the answer? This paradox explains why many capable leaders hold on too long, potentially compromising their organizations’ future success and their own legacies. The traits that were once assets become liabilities in the face of succession.
The Emotional Reality
The intellectual understanding of retirement timing often collides with emotional unreadiness. This disconnect between rational acceptance and emotional resistance creates a complex internal struggle that can paralyze decision-making. The emotional dimension of retirement extends far beyond the simple fear of change—it encompasses feelings of loss, questions of self-worth, and deep-seated anxieties about the future.
The Support System Shift
The corporate infrastructure surrounding senior leadership is an invisible yet essential part of daily operations. This support system goes beyond mere convenience; it extends your capabilities and amplifies your impact and efficiency. The potential loss of this infrastructure is more than a practical challenge; it signifies a fundamental shift in how you interact with the world and your ability to create change.
The Existential Question
Retirement forces a confrontation with the end of a career and questions about personal legacy, mortality, and meaning.
The most profound challenge is confronting the existential implications of retirement. For leaders who have dedicated decades to their organizations, this role transcends mere employment—it becomes a core part of their identity and purpose. Retirement forces a confrontation with the end of a career and questions about personal legacy, mortality, and meaning. This existential reckoning demands a fundamental reevaluation of how you define yourself and your worth beyond your professional achievements. The challenge is not just about leaving a role; it’s about reconceptualizing your place in the world and your sources of meaning and purpose.
Managing the psychological transition
The psychological journey of retirement requires as much strategic planning as the operational handover of your role. While organizations typically have detailed protocols for succession planning, the psychological transition demands equal, if not greater, attention. This internal journey must be approached with the same rigor and strategic thinking that characterized your leadership career.
Understanding Your Emotional Timeline
Research has identified distinct emotional phases that executives typically experience during retirement transitions. The journey begins with an anticipatory phase marked by mixed emotions of anxiety and excitement. Many leaders enter a period of euphoria and relief upon retirement—a psychological unleashing from years of pressure and responsibility. This initial honeymoon phase, however, typically gives way to a more complex emotional landscape.
The second phase often brings unexpected challenges as the reality of the transition sets in. This period can involve feelings of disorientation, loss of purpose, and questioning of identity. The timing and intensity of this phase vary, but its arrival is nearly universal. Understanding this emotional arc helps normalize the experience and provides a framework for managing these challenges proactively.
The final phase involves reinvention and renewal, where leaders begin to craft their new identity and purpose. This stage requires active engagement in creating meaning beyond traditional professional achievements. The timeline for reaching this phase varies significantly, and preparation, support systems, and individual psychological readiness influence it.
Creating Psychological Anchors
The transition from structured leadership to retirement requires establishing new psychological foundations. These anchors serve as stabilizing forces during periods of uncertainty and change. They provide continuity of purpose while allowing space for new growth and discovery.
The transition from structured leadership to retirement requires establishing new psychological foundations. These anchors serve as stabilizing forces during periods of uncertainty and change.
Effective psychological anchors combine structure with flexibility, maintaining connections to areas of expertise while fostering new interests and relationships. They should be deliberately designed to support intellectual engagement and emotional well-being. The key is creating systems that provide stability without recreating the constraints of corporate life.
Working with Transition Coaches
Professional support during this transition can be invaluable. Transition coaches specialize in the unique psychological challenges faced by retiring executives. They bring expertise in identity reformation, status adjustment, and creating new purpose narratives. Their role extends beyond traditional executive coaching, focusing specifically on the psychological dimensions of retirement.
These specialists help leaders navigate the complex terrain between their executive identity and their emerging post-retirement self. They provide tools for managing the psychological aspects of transition, from processing the loss of power and influence to developing new sources of meaning and fulfillment.
The coaching relationship offers a structured space for exploring anxieties, testing new ideas, and developing strategies for emotional resilience. It provides accountability and support while helping leaders maintain perspective during challenging transition phases. Most importantly, it helps transform what could be a period of decline into an opportunity for growth and reinvention.
This work often involves developing new metrics for success, redefining relationship dynamics, and creating frameworks for decision-making in this new phase of life. The goal is not to eliminate the transition challenges but to develop the psychological tools and perspectives needed to navigate them effectively.
Building meaningful post-retirement activities
The transition from executive leadership to retirement requires a fundamental shift in the conceptualization of engagement and purpose. The challenge is not to fill time—your network and reputation will generate more opportunities than you can accept—but to create a portfolio of activities that provides genuine fulfillment and leverages your capabilities in meaningful ways.
Beyond Traditional Board Work
While board positions represent a natural extension of executive experience, the most fulfilling post-retirement careers often transcend conventional corporate roles. The key lies in identifying opportunities that align with your interests while allowing you to apply your leadership experience in fresh contexts. Consider roles that challenge you to think differently, engage with new demographics, or address problems from different angles than those you encountered as an executive.
Creating Impact Through Teaching and Mentoring
The transmission of knowledge and experience to future leaders offers a particularly rewarding path for retired executives. Teaching and mentoring roles provide intellectual stimulation while offering the opportunity to shape future business leaders. These roles demand a different kind of leadership—one focused on developing others rather than directing outcomes—and often lead to unexpected personal growth as you articulate and examine your own leadership principles and experiences.
Entrepreneurial Ventures with Purpose
Post-retirement entrepreneurship fundamentally differs from traditional business leadership. Retired executives can pursue ventures driven primarily by purpose and passion, free from the pressures of shareholder expectations and quarterly results. These endeavors often focus on solving societal challenges or addressing market gaps identified during their executive careers. This allows them to combine their business acumen with personal values in ways not always possible in a corporate setting.
Navigating family dynamics
The personal aspect of retirement can be just as challenging as the professional shift. Moving from having limited family time to being constantly present demands careful navigation and clear communication. This change influences not only daily routines but also the core dynamics of relationships that have developed over decades of executive life.
Redefining Domestic Roles
The domestic sphere often has well-established systems and patterns developed over years of executive focus. Retirement requires carefully renegotiating roles, responsibilities, and decision-making processes. This adjustment needs sensitivity to existing patterns and recognition that efficiency in domestic matters may not align with corporate management principles.
Managing Expectations
Retirement expectations often differ significantly among family members. These differences extend beyond daily routines to encompass fundamental questions about lifestyle, time allocation, and future plans. Resolving these differences requires the same level of strategic thinking and communication you applied to corporate challenges but with an added layer of emotional complexity.
Creating New Shared Experiences
The development of new shared activities and interests becomes crucial in retirement. This process involves more than simply spending more time together—it requires building new patterns of interaction and finding fresh ways to connect outside the familiar context of business life. The goal is to develop activities that create mutual engagement while respecting individual interests and needs.
Maintaining Personal Space
Preserving individual autonomy while increasing togetherness becomes a crucial challenge in retirement. This balance requires a conscious effort to maintain separate interests and activities while building a new shared life. The key is developing patterns that allow for independence and togetherness, creating a sustainable rhythm for this new phase of life.
Making the transition work
The practical aspects of retirement require as much attention as the emotional and relational dimensions. Time management becomes more complex when one moves from a structured corporate environment to self-directed days. The challenge is creating enough structure to maintain purpose and productivity while preserving retirement freedom.
Financial planning should go beyond traditional retirement considerations to include the practical aspects of new activities and ventures. This planning must address both personal fulfillment and practical needs, creating a framework that supports your chosen post-retirement activities while ensuring long-term security.
Cultivating and maintaining support networks is crucial during this transition. These networks should go beyond professional connections and include individuals who offer emotional support and guidance during this significant life change. The aim is to build a diverse support system that helps people navigate retirement’s practical and emotional challenges.
Looking forward
The most successful transitions we’ve observed share a common element: the retiring leader shifted their mindset from loss to creation. They viewed retirement not as the end of their leadership journey but as the beginning of a new chapter.
The art of stepping down lies not in denying these psychological barriers but in acknowledging and working through them while building a meaningful next chapter.
The most successful transitions we’ve observed share a common element: the retiring leader shifted their mindset from loss to creation. They viewed retirement not as the end of their leadership journey but as the beginning of a new chapter where their experience and wisdom could be applied in different, often more personally meaningful ways.
Your next chapter awaits. The question is not whether you will write it but how you will approach it. Will you hold on for too long, potentially diminishing your legacy? Or will you begin now to create a transition that honors both your achievements and your organization’s future?
The goal is not to replicate the intensity and structure of executive life but to create a new chapter that provides meaning, impact, and personal fulfillment while utilizing the valuable experience and insights gained throughout your leadership career. By recognizing the psychological challenges and actively working toward your next chapter, you can create a transition that meets both your personal needs and your organization’s future.
