Your Retirement - What Will You Actually Do?

When we start working with a new client who's, say, aged 50, it's always interesting to get down to what they want to aim for in life. After all, if life is not about thoroughly enjoying doing things you love most, what is it about?

So when the 'Retirement Reality' study from an insurance company came out the other day, it was something that we took notice of. It looked at what retired people actually did in the first year or two of their retirement.

Two decades ago, most people believed they would spend retirement:

babysitting grandchildren (30%)

gardening (29%)

reading (29%)

But today's go getters now see retirement as the next stage to their lives and having a long list of ambitions to fulfill (86%). Switching off the alarm clock (52%), becoming spontaneous (49%) and saying goodbye to stress (48%), are the most valued parts of this new stage of life. Also, (52%) say their partners become a bit more romantic!

They tend to have over 30 social events a month, and comment that relationships have never been better (67%). Indeed 72% think it's the best year of their lives, and they do not feel that society will view them as 'old' until at least age 68.

Photography is very popular (25%) as is socialising with friends (36%). The 2009 'Things to do before I die' lists include:

Getting to see a few of the Seven Wonders of the World (47%)

Finally learning to speak a new language (23%)

Buying or hiring a motor home or camper van to tour Europe (22%)

Dating a younger man / woman (12%)

Driving a fast sports car like a Ferrari (11%)

Launching their own business (11%)

Learning to play various musical instruments (11%)

Sky diving! (9%)

Going to events like a music festival (9%)

Learning to surf (7%)

Looking at what our clients decide to do just after retiring this list perhaps looks about right, with travel, boats and sports cars very often up there at the top of the list.

We're not sure regarding number 4, as to whether it's more risky than sky diving :)

They were also asked, if they could go back 20 years, what they would do differently with the benefit of hindsight.

The most common advice they would give to themselves would be:

Be more disciplined and save more (47%)

Be more savvy with pension planning (41%)

Look forward to retiring rather than dreading it (24%)

Think more carefully about their spending budget in the first year of retirement (20%)

Retire even earlier (21%)

Prepare more thoroughly for the first year into retirement (19%) as it can prove expensive

Quite a few retirees who took part in the survey also said that when they were planning ahead for retirement they found it confusing and advice was not always clear.

This topic is something we are very passionate about, as we spend a lot of time talking to clients about what they really want to achieve in life.

20 years ago people got financial advice that centered on buying policies to 'save for the future'. You can still do this of course by dealing with the banks or various salespeople. However, developments over the last few years now mean you can choose to use a Fee Based Financial Planner who will truly focus on what is important for you.

We constantly find that when agreeing to work with a doctor or dentist, say in their late 40s or early 50s, they have no financial strategy whatsoever. What they do have is a jumble of policies and investments they have collected over the years, and a vague idea that there will be NHS/State Pension benefits to come.

One of the most common things we find ourselves doing is cancelling quite a few protection plans, as sometimes the salesperson has not taken into account the generous NHS benefits that our clients build up after 20 plus years. If you combine this with older children and less debt, the savings that can be made are substantial. Savings here can be spent or saved to help fund your goals in life.

Getting back to goals, if you decide to get more serious about your finances, the first thing your planner will do is ask you to write down your goals, aspirations and your timeline. For those of you who have not been through this process when thinking about your future, we thoroughly recommend it as it will help you focus on what really matters.

Remember:

"Dreams are just dreams without a deadline!"

The Financial Tips Bottom Line

Plan ahead - if you are not working 50-60 hours a week, what are you going to do with your time in retirement?

ACTION POINT

Get organised and write down what you really want to achieve in life before, and during, retirement.

How much will this cost?

When by?