Only 3 per cent retire with enough savings for a comfortable lifestyle - that could well last 20-25 years. And about 40% retire with virtually no savings at all. But because you're reading this magazine, you are probably in that demographic cohort considered to be "under employed" (meaning you want to work but can't find a job) however you're most likely to be in that 30 per cent with the capacity and motivation to create for yourself some extra income in retirement.
The five pillars for achieving a better lifestyle for your retirement years are
· Health & Wellbeing - Mediterranean diet, exercise, meditation
· Family & Friends – social relationships,
· Extra income - retirement startups, profitable hobbies, house renovations, reverse mortgages, an online business
· Best place to retire – “college towns”, the sunshine states, overseas
· Maintaining a zest for living – optimism
Over 50% of your fellow retirees will live into their 90s.
For a man aged 65, the probability is that his "estate event" will occur at age 89. For a woman (same age) her probability is age 92.
A village in the south of France has a lot of appeal - including their national health and hospital services.
A small town in the South - but with easy access for the family to visit - can be very attractive
If you truly like warm temperatures, then Arizona will be high on your list to consider.
Our No. 1 choice within the USA
Our No. 1 choice for retirement within the USA – chosen very selectively from the myriad of locations who describe themselves as top retirement locations – is the municipality of State College in Pennsylvania.
College towns keep you physically young, and mentally stimulated. Another advantage of college towns is that you can boost your retirement income by renting out a spare bedroom to students.
The reality is that well paid, permanent jobs for seniors are rapidly evaporating - however there are exceptions. We're all now members of the global economy (did you realise that the Russian invasion of the Ukraine caused the world-wide milk glut?) so the solution to finding a job today is to find where international events have less impact.
For many of us the 1950s image of an idle successful retirement - fishing and golf - has now been replaced by the desire to do what we truly want to do, whatever and wherever that is. But until we find our true interests and passions, finding Involvement can be frustrating.
Your ideal retirement could be travelling, playing card games, mentoring micro business startups, or collecting the grandchildren from school.
Obviously we're all going to need extra income, but that's not why I advocate working as long as you can - it's because social interaction with your peers has positive health impacts.
We all need to plan for health care and other costs associated with ageing, and then we all should be open to a phased move into retirement (whatever that means today) which includes learning new skills and sharing time with an extended network of family and friends.
Everyone is different, however for an broad overview of your own Personal Guide to the Five Pillars (before focusing on each pillar individually) here is a sneak preview about a possible successful retirement lifestyle available to everyone: Planning for Retirement.
So looking forward into those years after age 65, the four pillars we need to focus on specifically for any success with practical retirement planning are
Of the four pillars, your finances are probably the most important, as money gives you options.
Now let's start. Use those four pillars as chapter headings for your checklist, and I recommend that you buy a ring-bound school exercise book at your local paper supply store, and spread the chapters - and subsequent sub-chapters - throughout.
And it’s best - when
planning - to assume that you will live another 20-25 years after the date when you opt out of the workforce and begin your "retirement" (whatever that means today).
And I fully endorse the approach of Professor Robert Reich, of the University of California at Berkeley. He says "most Americans believe that their retirement years with resemble Club Med with on-site health facilities. Snorkeling in the morning and extra oxygen in the afternoon. But no-one can afford it because they haven't saved enough to achieve this ideal successful retirement".
Statistics released in 2010 show that most Americans have never given any serious thought to retirement investment plans. The facts are:
and these figures probably haven't changed much since then - although now with more baby boomers retiring, the percentage of those living exclusively on social security could be expected to be slightly higher.
Now it has become obvious that you can't rely on permanent paid employment in retirement - those jobs don't exist - however a specialist college professor would say that we all need a retirement financial plan, and maybe he would be right, but life is not linear, so it's important to keep some flexibility.
There are many ways to make extra money for your retirement, and I can tell you some that stand out. Retiree employment is more about hope than reality, however part-time jobs are an obvious option (provided you are younger than 70 and can find an employer who likes your skill set) as would be a genuine internet business that you can work from home.
Self employment is a real option for any retiree. Jobhack.org offers something similar for the young unemployed and bored. This is how they recommend that their clients proceed:
Challenge 1: Think Like A Job Creator
Challenge 2: Create A Brand
Challenge 3: Build An MVP (Minimum Viable Product)
Challenge 4: Acquire A Customer
Challenge 5: Pitch An Idea
Of course, if you are yet to retire, and are thinking of early retirement (whatever that is these days) you’ll find solid advice here. And of course my views on practical retirement planning include positive advice if you are thinking of a career change as you move into retirement.
However my principal focus here is to help you explore opportunities for an above average retirement income, so that you'll have options for 20-25 years of comfortable retirement.
My initial solution to the financial aspects of practical retirement planning (I was in my 50s) was to acquire some investment property, and soon I started a property investment portfolio with a few negatively-geared investments.
Property is an excellent asset for a successful retirement, because the rents you receive continue to rise. So you have an income, and a defence against inflation.
Negatively geared investments work best when values are rising, but in times when capital appreciation is slow, the trick is to focus on “buy-to-rent” properties.
However if those days are past you, equity release programs i.e. reverse mortgages should be seriously considered it you are in serious financial difficulties. This is one approach to relieve financial stress in retirement.
Sadly, the term "retirement planning" has come to refer to just one single component of the transition to a successful retirement i.e. financial considerations. But there is a broader view, as precise calculations about the future ignore everyday life events such illness, death of a spouse, issues with mature aged children, loss of capital and natural ageing.
I’m sure that you have searched the web for “retirement planning” with the result that you will have been offered introductions to hundreds of “financial planners”.
However the recommendations by financial planners are only for the wealthy, and in any event, they are seriously flawed (e.g. they focus only on your finances, they assume a straight line draw-down - which doesn't allow for major medical or accommodation expenses - and of course those recommendations ignore the devastating impact of inflation).
We have a different approach - given that most of us are not wealthy, we need to seek an alternative source of income in our retirement. And our proven solution to this issue is to focus on "profitable hobbies".
But this magazine has a broad view of planning for a practical and successful retirement, and we address various non-financial issues associated with retirement - such as intrepid travel for seniors and retirement abroad (my favourite location would be a village in the south of France).
You can re-invent your life - or undertake a career change after 50.
Even if you're close to retirement, or already retired, it's not to late to use your career knowledge to become a consultant, to become a small business entrepreneur, or do something else that gives you the stimulation to jump out of bed each morning.
The reality is that unless we do something stimulating, we will be terribly bored for those 20-25 years of retirement. And as social security was never designed for a population that is living far longer than ever before, it is simple too expensive for the government to maintain. So we have to distance ourselves from any thought that "big brother" will continue to provide for us.
Consequenlty we focus on practical successful retirement planning, with a focus on lifestyle and extra income (via profitable hobbies) for Mr & Mrs Average. Including the oxymoron: retirement vacations.
Along the way, as a property investment consultant (initially within a group and then in my own practice) I would invariably meet people who - for whatever reason - were unable to commence a portfolio. So I would say to them “as we’re all going to need additional income streams later on, let’s take whatever hobby you have, and convert it into a profitable hobby".
With the advice that I was giving about their home based businesses, I evolved into a (pro bono) small business consultant. And because I like helping people grow their own small businesses, this grew into an income stream for me, and I found it to be a very lucrative profitable hobby.
Now this inspiration about profitable hobbies for seniors was - to me - a solid contribution to the whole concept of practical and successful retirement planning.
My thoughts about practical and successful retirement planning cover a variety of topics within the overall theme of your Health, Family & Friends, your Finances, Best Place to Retire and your Zest for Living.
Feel free to consider my thoughts in more detail. And I have strong opinions - and experience - how you can build a genuine online business, for example, by using this tool: Site Build It!
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