I believe I have written about this topic before, but with the amount of conversations I have been having with many clients and friends on this same subject over the last 12 months, it feels appropriate to raise it again.
Retirement usually involves one or a combination of the following:
The general perception of retirement from all the marketing and advertising material you see is retirees spend the rest of the years playing golf, bowls, fishing, travelling overseas, caravanning, smiling and laughing and visiting their financial planner regularly for a coffee (whilst still smiling and laughing!) to review their investments.
Whilst this may be true for some, the reality is retirement can be very different and very difficult!
It is a natural human emotion to have feelings of relief, elation, even triumph when successfully managing the sale or transfer of a significant asset or reaching the end of your working life. In many instances this event represents 4 or 5 decades of dedication, toil, stress, blood, sweat & tears so it is no surprise for the next few months the new retiree is on a natural “high”. They may now be debt free, have money in the bank they never thought possible, have so much spare time to do all of things they have dreamed about doing for the last 20 years. The overseas holiday is planned, the new golf clubs purchased and you never have to work again. Life just could not be better!
It is common for us to see some clients experience a sense of loss, sometimes grief after the initial novelty of retirement has worn off. For many there is a significant change in lifestyle and this adjustment is the most challenging to deal with. Some examples of these challenges include:
When clients talk to us about winding down their business or working life, which may involve ceasing work completely, in the majority of cases their initial need for advice is around managing the tax consequences of these transactions and making sure they have enough money to live on for the rest of their life. In the majority of cases these issues can be addressed.
But it is also important to ask the following questions:
For some retirees they will be satisfied fishing, golfing, bowling, travelling, volunteering and spending time with the family each day – which is great. This is what the brochures tell you retirement is.
But for others retirement is different. The challenge is to recognise what you want your retirement days to look like (aside from the money) prior to the big event happening which will hopefully make retirement easier to deal with.