Retirement is not a jail term

I was talking to a man who retired almost 20 years ago. I asked him whether he ever missed his job. He said he enjoyed his retirement because he had looked forward to it from the day he got his first job.

This was quite in contrast to most people who seem to fear retirement. The reason this elderly man looked forward to retirement is because he realised he would one day retire, and began preparing for it.

He prepared for it so well that he says these are the best years of his life. 

Almost all the talk around retirement is usually about finances. Income is a key consideration when you are planning your retirement, but retirement is not just about adapting to a new financial landscape, it is also about having a new life plan.

When thinking about retirement, one should consider some of following:
Why think about retirement now? Do you want to retire completely? How much are you defined by your job? Does the thought of not working leave you insecure? What do you value? Do you have outside interests or hobbies? Are you planning new activities in retirement? Transition into retirement can be one of the biggest challenges we face. With the right amount of forethought, however, you should manage to spend your retirement years doing the things you love. 

There are some aspects of your life after retirement that you will know in advance and those that will be unknown to you.

Here is what you don’t know: How long will your nest egg last? What if you live to be 100? What will the price of basic commodities be in 40 years?

Another question you may want to ask is whether you will have good health in retirement. Typically, health care costs increase as you get older, when you probably have less money.

Here’s what you must know: Your lifestyle will dictate how much you will need to save and invest in order to maintain a standard of living that is comparable to or better than what you enjoyed while working.

Remember too that you must factor in inflation so as to maintain a similar purchasing power during retirement.

So, anticipate the cost of your retirement and start a retirement plan.

Here are some tips: Regularly conduct a self-audit. It is imperative that you take time to assess your financial situation. Think of where you are financially, where you want to be, and how much you expect to have and spend during retirement.

Do the research: Evaluate what kind of plan your employer offers. Employees with defined contribution plans nowadays do have more control over their investment portfolio. However, many workers may not have the financial know-how or the confidence level to make investment decisions. If that is the case, consult a financial planner.

If you are self-employed or if your employer does not offer a satisfactory retirement plan, check out options at your bank and/or SACCO and visit with a financial planner.

Trust your instincts: You have the right and mandate as a mature individual to make your own decisions and judgments and avoid thinking of yourself as powerless.

Think of your options, and if necessary, turn to a trusted friend or financial advisor for support.

Join an investment club: In addition to educating yourself on financial matters, you can join others who are interested in investing.

Manage your resources wisely: The bottom line is that, even with what you have today, start saving and investing. Whatever direction you choose in retirement you will need money, thus, you should not put your eggs in one basket.