I work with honest, hardworking people. ‘Normal’ people who’ve put the years in to their work and want to enjoy as stress-free a retirement as possible. They’re not rich but have done enough during their working lives to have prepared for (or earned!) a comfortable retirement.
But just because you’ve retired and, on the face of it, seem to have enough money to live on, the story doesn’t end there. At least, it shouldn’t.
Financial security is the holy grail for a lot of us. Surely, after health and family, financial security must be the most important thing. It provides peace of mind and the ability to do things with your life.
But what do you do now? What do you do with your time and any surplus money you might have? You can’t change the essence of a person. I’ve come to learn that over the years. Just because a person has ‘more than enough’, it doesn’t mean they’re going to go out and buy a Ferrari. It doesn’t work like that.
So what are the issues you might be facing? Despite having finished work (perhaps, you retired years ago), what concerns do you still have about money?
Have I REALLY Got Enough?
This is a relatively straightforward one to work out and I’ve referred to this in a previous blogs. To keep things simple, you need to do the following:
- Work out what the cost of your lifestyle is.
- Tot up your guaranteed income (things like your state and final salary pensions).
- Build in any one-off expenses (great holidays, gifts to family, etc.).
This should give you a good idea if you’re going to run out. You can also factor in some estimates on care costs to see what the position is.
If you DO have enough, great news! If you DON’T, there are things you can do about it. Better to know what the destination might look like before you get there!
One of the biggest concerns my retired clients share with me is the impact care fees might have on their capital. Even though, on the face of it, they have more than enough, there’s a lingering thought in the back of their minds that care fees might erode it all.
- I might have to sell the house.
- I may not be able to leave anything to the children / grandchildren.
- If I run out of money, what impact will it have on the quality of the care I receive?
These are all biggies and I understand why they’re a concern. If you need to go in to care, it’s likely that this will be expensive!
That said, you’ll still receive the same level of income you’re currently getting and there’s also the scope to rent out your home to pay towards costs. Whilst there’s likely to be a drain on your capital, it might not be as stark as you first imagined.
Enough to Be Daring?
You’ve probably got to retirement in a financially secure position by learning, from a young age, to live within your means. It’s a brilliant philosophy. Don’t spend what you don’t have.
That said, too often I see people who clearly have more than enough, but struggle to change this engrained essence within them. Life’s not a rehearsal and you never know when your health will stop you doing things.
Think about things you’ve always wanted to do. Things you’ve toyed with but always put off because they might seem ‘irresponsible’ or indulgent. isn’t NOW the time to be doing them? Why have you saved all these years anyway?
I get great pleasure hearing from clients who’ve done some amazing things. Things they may have only once dreamt of. Once they’ve got over the, often significant, hurdle of ‘can I afford it?’ or ‘isn’t that a bit extravagant?’, they’re all systems go!
Helping the Children / Grandchildren
We all know it’s harder for younger people to get a start in life these days. Many are priced out of the property market and the world of employment is ever more competitive.
How nice would it be to be able to give them a ‘leg-up’. To be able to give the ones you love a competitive advantage in life. Of course, you need to know you can afford it but, in my view, giving with warm hands is far better than giving with cold hands.
You Might Think Differently
These are just my thoughts. But they’re thoughts based on my experience of doing my job for well over 20 years. I understand the issues people wrestle with when it comes to money. MONEY = EMOTION.
I’m always saddened when I see situations where clients could do more with their lives, but don’t because of fear. It’s completely natural, however, it’s a mindset that can be overridden with the right help, support and planning.