When it comes to planning and saving for your retirement, there’s loads of information already out there. This means it’s now easier than ever to put together a financial retirement strategy that’s well-informed and well-considered.
Knowing exactly what will happen once retirement actually arrives, though, is trickier. Every experience is different, and you can’t be certain that adapting your lifestyle will be easy. It’s also impossible to foresee every possible event.
That’s why we’re embracing the trend of going for a ‘retirement test-drive’. This means taking some time out of your usual working schedule to follow – as closely as you can – the routines and lifestyle choices that you are envisioning for your retired life.
Aside from hopefully being relaxing, this gives you a chance to spot any potential pitfalls before you’ve reached the point of no return.
Start spending according to your retirement budget.
- For at least a month (but ideally for several months), restrict yourself to the amount of money that you’ll have once you’ve retired.
- Are you able to live as comfortably as you anticipated? Is it enough money for you to make ends meet? Find out now, while there’s still plenty of time to go back to the drawing board.
- If there’s cash left over from your current monthly budget, you can set it aside to give yourself a better head start once you retire for real.
Experiment with the new hobbies and activities that you’re planning to take-up to make sure your retirement doesn’t become dull.
- This serves a couple of purposes. From a financial point of view, finding out whether these hobbies are for you now saves you from wasting money as a retiree if turns out you don’t like them. If you do enjoy yourself, you’ll have the opportunity to pick up any expensive equipment or memberships while you’re still earning.
- At least as importantly, you’ll be able to see whether they’re actually going to engage your brain, help you make new friends and give you plenty to do now that you’re no longer regularly heading to work.
- If you’re planning to make big lifestyle changes – such as moving abroad – then it’s probably going to be difficult to replicate that before you actually retire. However if you can take a trip to your place-of-residence-to-be and stay there for a couple of weeks, you’ll get a sense for how costs will differ from what you’re used to.
Put Extra Thought Into These…
Other big changes might include adopting a pet, or spending a lot more time jet-setting on luxury holidays. When you can’t ‘test-drive’ these decisions, make sure you put extra thought into both the obvious financial costs and the not so obvious.
Ultimately, the plan should be to take a few weeks away from your job while you’ve still got a year or two before retirement, and use that time to get a real sense of what life is going to be like.
Involve your spouse and any other family members who might be affected – and remember, it’s not often that we get the chance to glimpse at what our future may be like! So take advantage: use the opportunity to get a sense of both the financial implications of retirement and whether it will be satisfying for you.
Overall, you should be seeing retirement as a smooth transition rather than a sudden change of circumstance; taking a test-run can help make things smoother.
This post was written by the team at equityrelease.co.uk, a site which provides facts and information about the process for people looking into equity release plans – as well as the ability to compare over 50 plans.