Section 9
‘Retirement, a time to do what you want to
do, when you want to do it, where you want to do it, and, how you want to do
it.’
Catherine
Pulsifer
GEOGRAPHIC FREEDOM
Environment is important. Retirees reporting
the greatest satisfaction tended to live in places with the following:
● Housing
with low maintenance costs.
● Easy
accessibility to hospitals, shopping and recreation centres.
● Very
secure neighbourhoods with no need for elaborate security precautions.
● A
sense of community and connectedness.
● Availability
of affordable internet.
A word of warning about emigration; what retirees need least is isolation and exclusion.
Retirement in itself can bring shocks that are
difficult to prepare against and has to be eased into gradually. Moving to
another country has to be one of the biggest life choices a person can make,
and should not be made so soon after retiring.
Along with this, emigrating strips you of some
of the supporting factors of the country you’ve previous lived and worked in,
the benefits of which may not have made themselves apparent in your former life:
the ease in which you communicate, make sense of your immediate environment,
partake in the minor rituals of your society (even those that seem to provide
no purpose.) and casual conversations.
These can be things that might not seem so
important when you go without them for only a week or two, as you would
travelling, but there are special occasions and emergencies that throw a new
perspective onto things.
Your country and community play a big role in
your identity and sense of purpose. Perhaps some individuals would be more
fulfilled away from the country they had become accustomed to, but as a general
rule we would say: ‘By all means travel,
but reconnect to your community!’
FINANCIAL FREEDOM
As company structure becomes more fluid,
responsibility for retirement planning will gradually be transferred to
individuals. This goes hand-in-hand with the autonomy we have gained over our
work.
Calculating Need
Asking ‘How much will I need for retirement?’
is a little like asking ‘How long is a piece of string?’ There is no convenient
figure that we can throw out to you. In this section we will take you through
some calculations to help land you in your own ball-park figure. You’ll need to
consider:
● The
age at which you want to retire.
● The
standard of life you intend to live at, both the baseline amount needed to
continue at that level you are accustomed to, but also a higher, more ideal
number that would allow you new luxuries (travel, hobbies).
● Medical
expenses.
● The
extent of your investments and assets able to generate an income.
● If
you have a company pension plan, obtain an estimate of its value from your plan
provider.
● The
government benefits you are entitled to.
● The
amount that would make you feel comfortably protected from the worst case
scenario.
Spanners
in the Works
Good Habits
Squeezing Pennies
Spanners
in the Works
As we have said (perhaps too many times) over
this guide; the unexpected will happen. When calculating your absolute
baseline, take a second to consider how it would feel if to be confronted with
the following occasions:
● You
are made to retire earlier than you would have chosen for yourself.
● Your
spouse, for whatever reason, is no longer able to work in the capacity he or
she once did.
● Your
health takes a hit, and your medical costs suddenly inflate.
● Your
spouse, or any family member really, hits a significant milestone and you
realise that they deserve spoiling; with something far beyond what they’re used
to.
● You
son/daughter is starting university/getting married/entering the housing
market, but they themselves have a very low income. Subsequently, they plan to
enter the housing market, without a leg to stand on.
● A
secondary income you had relied upon suddenly collapses: The lodger leaves. The
deal falls through.
Spend a second just to ruminate on these. Personalize
them as deeply as you can.
How
would you feel to break the bad news to those close to you?
How
would you feel to be capable of generosity?
Of course - not all of these problems need to
be met by cold hard injections of capital - maybe you have a nimble-minded,
cost-free solution - lucky you! - but
for the most part cash is the most direct answer to these problems.
Good Habits
Perhaps the most important single piece of
advice we could give is this:
Start
now.
|
Those that are most
successful in saving for retirement are those that start early.
|
Decide
a budget and stick to it
|
Targets are important:
especially in areas that boil down to numbers. Be flexible - if the first
number was unfeasible, adjust it. If you falter one month, get back on the
horse the next.
|
Confront
debt
|
Debt is like a cancer
- it grows in the shade. Confronting it is a painful, necessary thing.
|
Create
a steady plan
|
Just as you would
with a diet - adjust to a slow and steady pace that you can tolerate to climb
your way out of your obligations.
|
Automate
it!
|
Go
to your bank and set up an auto-pay into your retirement fund.
Not
just this: set up an auto-pay system that pays money into your retirement
fund as close as possible to you receiving it. And once it’s in there, don’t
touch it.
This
takes away the pressure of remembering and the labour of making the payment,
but it also gets you out of the habit of seeing the ‘spikes’ and ‘dips’ of
your balance, as the money makes its passage. You’re better off not knowing
it was ever there, and readjusting to see whichever number remains as the new
norm.
|
Factor-in
inflation!
|
Assume
an inflation rate of 4%.
|
Assume the worst
|
The
worst feeling in the world is ‘Hmmm, I don’t have as much as I thought….’ Don’t
kid yourself by rounding up your income. Round down your
income, and round up your costs - the remainder will be more
motivational.
|
Squeezing Pennies
Perhaps you haven’t saved.
Perhaps it wasn’t possible to save given your
circumstances.
Perhaps time just slipped from your
fingers.
Or maybe you did everything right, but it didn’t matter this time:
Perhaps life wasn’t fair.
If you’re reading this, chances are you have
lived through an economic recession. The sad fact is that even if you do
everything right, things can still go wrong. We can’t prepare for all
possibilities. We can’t cover all bases and blind-spots - any of us can be hit
hard, seemingly at random.
If you are behind others, you have to make
greater sacrifices. You will have to think outside of the box - and weigh up
some options that may not make you so comfortable - but remember the severity of the alternatives.
In
what ways can you use your existing assets to generate an income? Could you
rent a room of your house?
Consider
Semi-retirement - This needn’t necessarily be in the same
capacity and location of your previous work. You could make use of your
experience and time to work on a freelance basis. (www.elance.com
www.fivver.com
and https://www.freelancer.com are
good starting places or you might place ads in the local newspaper.)
This is the continuation of a serialization of this new ebook on active retirement, by a Ugandan, Petero Wamala, and an American, Douglas Winslow Cooper, Ph.D., which ebook is available through amazon.com for $0.99:
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