Retirement planning goals are often set without proper consideration of both known and unknown life transitions and in isolation from influences that might impact your retirement plan and based on an assumption that your life will unfold without any hiccups along the way.
This approach can mean that if your life does not go according to plan, your retirement will be compromised and you could be denying yourself the opportunities that come with planning and foresight.
The retirement planning process should not be completed in a vacuum and should look forward to your future and consider what life events will happen and what might happen.
These life events should be reviewed each year and reevaluate their importance, as your thoughts and circumstances change. This constant review helps you to always be prepared for the unexpected.
You can live a long, and happy retirement, by preparing for life events and transitions for the following reasons:
- Retirement Goals
We all like to think that life will proceed in a perfectly straight line. However, this is rarely the case. Retirement goals require careful thought and consideration of many ‘what if’ scenarios. The creation of a timeline of life events extending out to 30 to 50 years, will help you refine and expand your retirement goals.
- Retirement Calculations
Does your current retirement plan cease at the age of 65 – the mythical retirement age? There is life after 65 and you need to make sure you have a plan extending beyond the age of 65 so that you are prepared and also make the most of your opportunities.
- Non-Financial Retirement Goals
By planning ahead of time and exploring what is possible, you can start to implement plans to achieve what you may have not thought possible. For example, your 10-year goal may be to complete a new degree and fund the cost. By simply being aware of this life event, can assist in developing an action plan to complete this goal.
- Transition to Retirement
We have a tendency to adapt our lifestyle to the income we have to spend. Having an understanding that we need to plan for the next 20 to 30 years and for many different events, can assist in reviewing these lifestyle costs and turning our attention to aligning our spending and retirement goals with our values and purpose.
- Retirement Planning Transitions
Life is full of events and some are more certain than others! These known and unknown life events need to be considered, to reduce the potential impact on your retirement plan. The better you are prepared for a life event – mentally, physically, and emotionally, the more financially secure will be your retirement plan.
- Retirement Planning Strategies
The process of noting all the possible life events and possibilities will assist you in seeing the impact of one life event will have on another and assist in the choice of appropriate retirement planning strategies for your circumstances.
- Retirement Review and Update
Understanding what life events may impact your retirement plan will assist in the regular review and update of your retirement plan as your life, the circumstances of those around you, and also related legislation change.
The constant review and update assist in making sure you are using the appropriate strategies available for your circumstances, retirement phase, and legislation.
As part of your retirement planning process, consider preparing a financial timeline stretching out for 30 to 50 years and consider key life events some of which are known and others unknown, which may impact your retirement plan.
For further tips on how to prepare for retirement, download the attached ebook “How to live an Inspired Retirement” or listen to the “Real Life Financial Planner”, Geoff Ivanac on our retirement podcast, “Real Life Retirement Radio”.
General Advice Warning: Any advice on this site is general advice only and does not take into account the objectives, financial situation or needs of any particular person. It does not represent legal, tax, or personal advice and should not be relied on as such. You should obtain financial advice relevant to your circumstances before making any decisions.