There Are No Rules for Retirement
The saying goes; rules are made to be broken. The same applies to retirement. The very definition of retirement has changed and when you’re planning for later life, there’s no set template for building the perfect retirement plan – it’s all up to you.
Everyone has a different idea of the dream retirement. Some people want to travel the world, spending their time discovering new experiences while others want to settle down in their favourite place, enjoying the rewards of their hard work.
The same can be said for the journey. How you achieve your life goals and reach your retirement number is personal to you. Some people will buy their first property and live there for their entire life, using a pension and savings to build a nest-egg.
Others might turn to investment as a way to support their income, building a portfolio that can be utilised throughout their life.
And this is all before we think about life’s challenges. We never know what’s around the corner that could drastically alter our circumstances, meaning its vital we have a plan flexible enough to accommodate big changes.
The only constant that should be at the back of your mind when planning your future? There are no rules, it’s all about how you want to retire.
Throwing Out the Old Rules
When people think about the stereotypical retirement, it’s typically considered a singular, life-altering event. One day you hit a certain age and suddenly you’re not working and life is all golf courses, bingo and cruises.
Obviously in the modern day this simply isn’t true. More than ever, it’s important to recognise that retirement is a constant process – from the moment you start planning for later life until the day you officially become a pensioner.
Similarly, everyone’s definition of retirement is different and it’s no longer just about ‘not working’. Some people are happy to work through retirement doing something they love. Some people are retiring much sooner than the standard age. By rights, while some people will love the idea of kicking back and enjoying a life of leisure, it’s not the same for everyone anymore.
Working to No Rules
So we’ve established there’s no rules to retirement but you still need a plan. Planning is vital for ensuring a smooth transition into your retirement and shouldn’t be confused with the idea of set rules.
Instead, no rules means taking a proactive approach to your planning when you’re younger and thinking of retirement as a constant process that includes multiple stages of life. It means starting a savings pot for a rainy day or taking that Christmas bonus and investing it for the future. You might not have a clear objective but at least you’re working towards something.
While we’re on the subject of objectives, it can be a good idea to think about what you want to achieve. Writing down your vision and goals will make it real and reality is the best motivator. Having a tangible, realistic goal to work towards will unify your efforts into building success.
Consider doing this as early as possible. Time is the most valuable currency you have, especially if you’re considering a route of investing or long-term saving, as you open up the power of compounding.
Any investment that utilises compound interest will most likely be a huge improvement and demonstrates the power of planning for your retirement early. Remember this is just one way to achieve your goals and there’s many other alternatives open to you.
If you’re not thinking about retirement, there’s never been a better time to start. At SevenCapital, we’re exploring the concept of retirement and how people can start planning early to make the most of their time.
Whether you’re looking to build a framework to meet your retirement or you just want to know some interesting facts about the subject, our 2020 Retirement Guide has it all. Download your free copy of the guide today.