This is the question on many people’s minds – what should you do when you retire? Some of you may have firm plans in mind – for example, you know where you’re going to live, what you’re going to do and how you will spend your days. However, many people reach retirement without having any planning in place. Often, this can result in situations such as retirees not being able to afford that last-minute luxury cruise they had in mind…
Why is it so important to plan for your retirement? The sooner you plan, the better your retirement will be. Planning for your retirement in advance allows you to save for longer and helps you make sensible plans for how you will spend your hard-earned money. After all, none of us really knows how long we will live for…it could be 100! So, in this article, we look at some examples of retirees who chose some interesting ways to spend their golden years.
“Getting old is a fascinating thing. The older you get, the older you want to get!” Keith Richards
Debbie & Roger – living on the canals
Having worked hard all their lives in professional corporate roles, Debbie and Roger reached their late 50s and decided to make use of the “pension freedoms”, which allowed them to draw down from their pension income to set up home on a narrowboat. The couple decided to sell their home and split the profits into ISAs, investments and high-rate saving accounts. Currently, they are blissfully winding their way along The Grand Union Canal!
Narrowboats are an increasingly popular way for people to spend their retirement. One of the reasons is due to the cost of a narrowboat, which is far cheaper than the cost of a house – you can buy a good quality narrowboat for less than £50,000. Many people view this as an idyllic way to see the country, constantly touring across the UK’s canal systems. Some people rent their homes out while they’re on the water, but many sell up completely and move their money into savings and investments. This can help to ensure they maximise any potential returns on their money, rather than pennies being trapped in bricks and mortar.
Kim & Linda – living ‘Down Under’
This same sex couple only found each other at a later time of life and they decided to push forward their plans for retirement, so they could enjoy their remaining time together. As they are both in their late forties and without any children, they decided they wanted to live in Australia by the time they were both 55 years of age. Due to their current age, this is only a short window of time, but as they both have good pensions and a mix of savings and properties, they decided to reorganise their money. Kim and Linda chose to invest some of their savings and transfer the rest of their money into financial products that will achieve higher rates of interest over the long term. If this is something you’re interested in doing, then please talk to our team who will be able to advise you.
Living abroad is another popular theme for retirement, especially in nearby countries such as Spain, France or Portugal where it’s easy to make the trip back home to the UK. If you’re considering buying property abroad, always check the regulations of that country in terms of whether you will have full ownership of the land and property. If you’re considering selling up to achieve your dream, then make sure you have suitable ways to manage any profits from your house sale in terms of savings and investments. It’s important to create a sound financial buffer, just in case your plans fall through or you change your mind.
Rakesh & Alisha – living to travel
Although this couple are only in their thirties, they decided to start making plans for their retirement as soon as they were married 10 years ago. Rakesh has family members located across the world and Alisha’s family are based in the UK and India. The couple were inspired by the idea of travelling across the globe when they were older to visit their relatives and possibly even live abroad. Rakesh and Alisha have three children, so they wanted to create a plan for their futures too. They decided to save as much money as they could to create a way for them to support their family and travel extensively once they retire. They decided to build a robust financial strategy that included a small yet diverse investment portfolio, which they could increase over time, they set up pension schemes for every family member and a Life policy through Rakesh’s small business, as this gives them some tax relief. They also decided to use the Help to Buy ISA to purchase their first home, making use of the 25% government top up.
By creating a varied portfolio of savings and investments earlier on in life, Rakesh and Alisha have made a good start towards funding their retirement. Should they choose to travel the world or stay in the UK when they retire, it really doesn’t matter – they will have the choice to do exactly what they want due to the money they have saved.
So, whether you’re planning to conquer Mount Everest, create a new life Down Under, or you’re looking to set sail across the high seas, the earlier you save in life the more choices you will have when you retire.
“Old age is like everything else. To make a success of it, you’ve got to start young.” Theodore Roosevelt
If you would like help creating a successful retirement plan, then please get in touch to speak to one of our financial planners. We will look at your income, lifestyle, pensions, savings, investments, property, assets, and any business interests you might have to help you create a suitable retirement plan for a better future.