Retirement for most people is a daunting consideration – it is letting go of consistent security (often found through work and income) to financially support yourself (and dependents) for the rest of your life.
We often ask clients, what is your ‘purpose’ in retirement? A consideration that varies significantly from person to person.
When planning for your retirement purpose, a worthwhile starting point is to look at the balance between needs (day-to-day living) and lifestyle (travel, shopping, entertainment) activity. Add to that some planning around your ‘reserves’, such as a buffer if something changes in your situation (such as ill health) and potentially some financial legacy to gift your children and beneficiaries.
By breaking this down we can work with our clients to prioritise what is most important to them and work together to implement a plan that provides the ‘purpose’ they are looking for in retirement.
Using these key categories as building blocks can provide you with an investment framework that is more likely to deliver outcomes that are aligned to your goals. This can be done by identifying appropriate investments for each of the categories and how different investments might be needed to provide either capital preservation, a regular income stream or investment growth over time.