Retirement is something that happens to everyone eventually. It’s one of those things that seems so far away when you first start working, and something that can just creep up on you without you realising how fast the years have gone.
A degree of planning is a huge part in ensuring you have a successful and happy retirement experience so it’s super important to think well in advance for how to retire in a way that best suits you and your family.
We know that there are so many things to think about and consider when looking into retirement! That’s why we have written this article, to explore all the various factors that may influence when and how you choose to retire.
Factors Influencing Retirement Age
There are a number of factors that you may need to consider when looking at retirement, and this is different for each and every person. The most important step is to start thinking about your retirement early, and meet with planning experts so you don’t end up caught out when the time comes.
One of the most obvious considerations for deciding on a retirement age is financial. Many people in today’s world feel like they will never be able to afford to retire. We would urge those folks to start thinking about strategies that they can draw upon like investments, or pension plans.
Investment opportunities are a great way to have a sum of money that can be self-sustaining into your retirement. It is important to plan for market downturn, and also how you will have enough funds to access for your short-term, medium-term, and long-term plans.
A pension is often offered by the government to give a country’s elderly citizens a way to retire. However, with inflation this is rarely enough to live on. But, it can be a great way to have a reliable source of income. Check out your local government or work-provided pension plans to know what you will be working with in your retirement.
The final source of income in retirement is savings. It is important to make sure you plan for the unexpected when saving up for retirement, and also to make sure you budget enough to keep yourself and your family healthy and happy.
Health and Wellbeing
Health and wellbeing are probably the second most important driving factors for retirement age, and they can be a bit more difficult to predict than financial factors. You never know when your health will impact your ability to keep working.
Wellbeing is also a very important consideration. Most people who reach retirement age are excited to have the time to focus on themselves and their wellbeing again! Make plans to keep your wellbeing at the front of your mind throughout your retirement.
Personal Goals and Aspirations
Another perk of retirement is the ability to work on personal goals and aspirations. Maybe you have always wanted to learn how to become a baker, or a wood carver. Having a little bit of extra money in the budget for following your non-career related aspirations can help to keep your wellbeing in check, and keep yourself happy and fulfilled well into retirement. These aspirations may influence the time you choose to retire.
Alternatively, you may choose to delay retirement by a short time if you are near a personal goal related to your career. Look into the options you have within your company, if there is a mandatory retirement requirement it is important to plan around this!
Early vs Traditional Retirement
When it comes to retirement age, most people will be looking at either an early retirement, or traditional retirement. Traditionally retirement is retirement at or after the age of 65, but there is no law saying that you have to retire at this time.
Advantages of Early Retirement
Early retirement is retiring before the age of 65. While retiring early may seem appealing, it is really important to consider how you will support yourself for the rest of your life.
Here in New Zealand, retiring at the age of 65 gives you access to superannuation, the government pension plan. Retiring before this age means you may not qualify for superannuation or other social security schemes, which may impact your financial plan.
However, there are also really strong advantages to retiring early if you can afford to. For one, it gives you much more time to work on mastering those personal goals and aspirations.
Advantages of Traditional Retirement
Traditional retirement might seem like a bit of a downer considering the alternative is being a free agent, but it also comes with some great advantages. First and foremost, you are more likely to have appropriate savings and better options for healthcare into the next stage of your life.
It also comes with the benefit of keeping yourself nice and active, both physically and mentally. It is really important to consider how your mental health may suffer if you have a very active lifestyle now, but slip into a more sedentary one after retirement.
Retirement Planning Strategies
However you plan to retire, it is essential that you do so with a plan. Here are some strategies that can get you started down the right track for your retirement plan.
Setting a Retirement Goal
The most important step is setting a retirement goal. This can take many forms, including aiming to have a set amount of savings with an acceptable return rate for any investments, or having assets that you can sell when the time comes.
However you plan to manage your retirement, make sure that your retirement plan has enough flexibility to cover any unforeseen emergencies, like natural disasters, unexpected healthcare costs, or sudden loss of expected support.
To make sure you have an acceptable goal, consider how much you currently spend on necessary expenses, how much you need to save for your goal, and how many years you have left in your working life. You should also consider any dependents, and what kind of quality of life you want to be able to maintain for yourself and your family.
Consulting with Financial Advisors
Because financial support is a huge factor in planning for your retirement, we strongly urge you to use financial advisors to make a financial plan to support yourself. This will also help you to create a personalised plan, where you can account for your individual passions, goals, aspirations, wants and needs.
While there are a number of factors that may need to be considered in your retirement plans, we have covered the main three factors that every person needs to consider; financial, goals and aspirations, and health and wellbeing.
The Botanic is designed to support you throughout your retirement, so enquire today to learn how they can support you in your personal retirement journey.
Ultimately, the time that you choose to retire is up to you, and you can choose to do so at whatever age suits you best. In order to be best prepared, we strongly advise that you begin planning early, and take advantage of the knowledge of experts to create a strong retirement plan. Doing this will ensure that you are in the best possible place for your eventual retirement.
Remember that life is about more than working, and you should always be focused on what makes you happy. Planning for your retirement gives you the opportunity to plan to achieve and focus on whatever you desire. So, start planning your retirement today if you haven’t already!