I have already imagined exactly what my life will look like once I reach retirement age.
I’m in my mid 50’s and I have a relatively young family. When I turn 65, I may still have children living at home, for whom I will be financially responsible. It will certainly make it difficult to downsize.
I will also, I hope, still be responsible for ageing parents who live nearby.
So I picture an arrangement where I can continue working in a challenging and senior role. I don’t think I’ll be ready to give up work quite yet, and I can see that I will still need to bring in an income.
But I also see myself leaving work early more often, to check up on my parents, do their shopping and help them out, just like my father did for his parents.
I can see myself taking more time off, to go on trips with my sons (if they’re still interested, of course….), to barbecue for everyone in the garden and to enjoy family time.
I’ll probably be looking for flexible work conditions, at least for a few years. And then, when my wife reaches her own retirement age, perhaps I’ll slow down even further.
All this matters, because it affects the way I save for retirement right now. I also know that I need to plan my career trajectory in a certain way, to have this life post-65.
How about you?
If you haven’t retired yet, do you have a clear vision for what you want your retirement years to look like?
You need to develop one, if you haven’t already.
As I mentioned in my last email, retirement is changing as we live longer.
Chances are that you won’t simply stop work at 65 (although you might!). You might continue in your last job for several more years, opt for part-time or voluntary work, or even retire for a bit and then take on a new position, because you want to stay busy.
You need to be clear on what you want, so you can plan your finances for this time of your life in an efficient and successful way.
Your choices might also impact the way you manage your career, your health and your relationship with your family in the present.
Here are some of the questions to ask yourself, to get started:
Are you likely to have family members depending on you?
Will your spouse or partner, if you have one, retire around the same time? If not, what will you do while they still go off to work daily?
Is there an expectation that you are going to help take care of your grandchildren, if you have any, and is this an expectation you wish to enjoy?
Do you intend to spend your free time hopping between exotic locations, or do you plan to spend your days more home-bound, for example cultivating a beautiful garden?
Or, perhaps like the couple I told you about in my last blog, do you think you will prefer to find a light, part-time job so you don’t get bored, and feel you are still contributing?
Create a really vivid picture in your mind of what you want your life to look like. Don’t be content with generalities – get really specific and imagine all the details, because that will help you plan.
Of course, your vision of retirement may change over time.
When you are young you may imagine a leisurely retirement filled with afternoon naps, long morning walks and reading 5 books a month.
But when you approach retirement, the reality of this may not appeal.
When you are used to filling 10-15 hours of your day with work, commute, and family responsibility you will discover these extras hours in a day may leave you bored and dreaming of work, or at best being really busy again!
It is fine if your wishes change. You can always adjust your plans - and your savings.
But the last thing you want is to have to make all the important decisions 6 months before you are due to retire. That will virtually guarantee that you will run into difficulties creating the kind of retirement you really want.
So start imagining your retirement right now – whatever your age. It is never too early to start to plan for the retirement you want.