What Can You Do ‘Now’ For Your Ideal Retirement:
The ideal retirement. It’s not something most people give much thought to when they first start out at work. Sometimes, (scarily!) they don’t even start thinking about it until it’s nigh upon them. Then there are others who cannot wait to retire. They have a mental list of all the things they want to do. But, here comes the real concern. Without planning ahead, what you hope for your retirement can look very different when the time comes.
What do you need to consider way before you retire?
As it happens, those who cannot wait to retire probably have an unseen advantage. They are actually thinking about their ideal retirement in advance of it happening, so they’re effectively at least one step ahead of those who give it no thought at all.
No matter how old you are, it’s important that you think ahead to a time when you no longer have a regular income to depend on. While retirement does indeed mean lots of newfound free time, it also means that you will need to have accrued ample cash to survive off of for what will hopefully be a long and fulfilling time.
So, ask yourself these questions:
- When you do think about your ideal retirement, what does it look like?
- Are there things you want to do? Hobbies you want to pursue or places you want to travel?
- Would you rather spend your retirement at home, or are there things you’d like to be able to take care of to help others out?
Depending on your stage of life, the answer to these questions will likely change – and that’s ok too! But, you need to ensure you know what you’re aiming for if you’re going to get there. Irrespective of what you want your retirement to look like at any given time, your requirements will all have one thing in common. They need money. So, you need to be thinking about how you’re going to finance them when the time comes.
Don’t fall victim to thinking your pension will take care of it all
It’s important not to be blasé, or worse, complacent when it comes to your retirement. It’s all too easy to think that your pension will cover it. After all, that’s what you pay into it for, isn’t it? Well, yes, but that won’t necessarily mean it will cover all you have planned, especially if you have particularly epic plans for when the time comes.
Think practically about what you will need and how much it might cost
Even with the most simple retirement plans, knowing how much money you will need can be difficult. How much does it really cost to live your ideal retirement?
Of course, it depends what you do, but we can do a simple demonstration to show you why you need to think ahead. Are you ready?
Let’s take something commonplace like Sky TV.
As of today, the TV mogul appears to have a deal on, so it costs £51 per month. Assuming you plan on retiring at 65, and you live for say another 30 years, Sky alone will cost around £18,360. Yes, that’s without factoring them putting the price up!
Daunting, isn’t it?!
Yet, this example isn’t designed to scare you. It’s designed to show you the kinds of numbers you’ll need to factor into your retirement – and why inactivity now, when you stand a chance of doing something about it, can be so destructive if not remedied.
What to do?
Naturally, as advisers, we would be delighted to help you with retirement planning. So, if you’d like some help getting yourself sorted, do get in touch!
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Written by Ian Barnett
Ian is an experienced Chartered Financial Planner as well as being a Fellow of the Personal Finance Society, with over 25 years’ experience in the financial services industry. With a broad range of client experience and expertise, Ian specialises in financial matters from Pre-Retirement Planning to Inheritance Tax Planning and all points in between.