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Banking 101 –
Life beyond work: How to plan for retirement
Starting your retirement planning as early as possible gives you the freedom to choose what life looks like in the next phase of your life.
Making financial and lifestyle choices that will impact you 10 or even 20 years from now can be unnerving, but the truth is that planning for retirement can be a stress-free and rewarding journey. Whether retirement will see you spending more time with the family, focusing on a side project, or travelling the world, taking the time to plan now provides you with the flexibility of retiring on your own terms and gives your dreams the chance of becoming a reality.
When and how to plan for retirement
‘How much do I need to retire?’ is one of the most common questions people ask when planning for the future, but unfortunately, there is no universal answer. Retirement looks different for everyone, and there are several variables to think about when considering your ideal scenario. Will you be travelling? Downsizing? Selling a business? Taking care of family?
Three key questions to ask yourself when deciding how to plan for retirement:
- Where do I want to live?
- How do I want to spend my time?
- What do I want to achieve?
Defining your goals and what you expect to need in terms of income can help shape your plan and how much you need to retire comfortably. Cash flow modelling can help you visualise different scenarios and the potential impact to your expected income over time.
If retirement is more than 10 years away:
Analyse your current cash reserves, investments, non-pension assets and pensions. This will help you understand what your provisions could look like later in life.
If retirement is less than 10 years away:
You may already have an idea of what you want retirement to look like. However, it’s always worth reviewing your financial planning strategy to ensure it remains aligned to your goals. As you approach retirement, you may need to amend your strategy as your shorter term goals change.
Retiring on your own schedule
If you’re wondering how to retire early to pursue new goals and hobbies, the first step is to establish what your ideal day-to-day might look like. Many people who retire early don’t necessarily stop working and choose to set their own hours or reduce the amount of time spent working, opening up more free time to travel, enjoy non-income-producing hobbies or simply relax.
Strategies around how to retire early include establishing how much money you need to enjoy life after retirement, considering your anticipated expenditure against savings, investments and other assets.
Steps to consider when planning how to retire early:
- Pay off as much debt as possible, including your mortgage
- Estimate the length of your retirement
- Calculate your basic annual income and expenditure needs
- Factor in discretionary spending, like travel or hobbies, and later life care
- Review your assets to determine what your retirement income may be
- Review whether this income will cover basic and discretionary spending
- Consider estate planning and who you want to pass wealth on to
- Get advice from an experienced wealth planner
Working with a financial planner can help you create an achievable wealth plan that will give you peace of mind and security and help you take control of your retirement.
Investing in a retirement plan
There’s no better time to start planning than now. If you’d like to discuss how to invest in a retirement plan for your future or review an existing strategy, book a consultation with one of our experienced wealth planners now.
Becoming a client
Take control of your finances today by completing our enquiry form. Alternatively, you can call us on the number below and one of our team will be more than happy to talk about your future.
Related services
Wealth Management • Wealth Planning • Investment Management • Private Banking
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This communication should be considered a marketing communication. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research. It is for information purposes only and does not constitute advice, a solicitation, recommendation or an offer to buy or sell any security or other investment or banking product or service. You should seek professional advice before making any investment decision. The value of investments, and the income from them can fall as well as rise, and may be affected by exchange rate fluctuations. Investors could get back less than they invest. Past performance is not a reliable indicator of future results. The tax treatment of investments depends upon individual circumstances and may be subject to change.
The contents of this communication are based on opinions or conditions as at the date of writing and may change without notice. To the extent permitted by law or regulation, no warranty of accuracy or completeness of this information is given and no liability is accepted for its use or reliance on it.