You're nearly 55 and you're sick of Money Makovers

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Leper

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Every week I meet several people who like me are retired. Best thing about being retired is that every day is like a Bank Holiday. The worst thing is that some kind of financial independence is still a pipe dream or you are financially worse off than you have been. Yours should all be done for, mortgage should be a memory and the next years are now your most important.

I suggest:-
1. Get shut of top up mortgage or any other loans. Remember, you have to do this sometime.
2. Concentrate on your physical and mental health.
3. You've reached "me" time.
4. Review life insurance.
5. Get fitter if necessary.
6. Get your savings in trim even if you cannot beat inflation. You need a Rainy Day fund.
7. Improve anything that needs doing in your home.
8. Don't delay in getting your tax affairs up to date.
9. Slow down now.
10. Drive more carefully if you're not a careful driver.
11. Give time to your family as necessary without being a "hero. "
12. Keep your passport in date.
13. Don't even think of an Afterlife loan.
14. Bring your family onside.
15. Cherish your hobbies (this doesn't mean building a light aircraft from scratch). Reading, Writing, Sport, etc.
16. Avoid any rut.
17. Clear your credit card debt every week (not every month). Use the card less and less where possible.
 
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I have written 455 blogs over the last 10 years. The second one I wrote (the first one was about starting my company), was the 6 biggest mistakes retirees make. The biggest one was carrying debt into retirement. Most retirees are on a reduce income so the debt will take up a bigger percentage of your new income and have an impact on your ability to enjoy retirement.

I would also add that you should enjoy the years while you have your health. Once that goes, you won't be doing much except pottering around at home. And even if you look after yourself, we all get old and our ability to get around just isn't the same after a while. So enjoy yourself while we can.


www.bluewaterfp.ie

6 Biggest Mistakes Retirees Make - Bluewater Financial Planning

We look at the 6 biggest mistakes retirees make with their money when they stop working and start spending their savings.
www.bluewaterfp.ie www.bluewaterfp.ie
 
Hi Steven
That is an excellent post. It should be given to everyone on retirement.

I met someone recently who was cashing their pension to give their son some money. The son was earning far more than the mother. And she will need it far more than he ever would. I had not realised it was a common mistake.

Brendan
 
Brendan Burgess said:
If you are only 55, have you considered returning to work until normal retirement age?
Click to expand...

I took it Leper was referring to being 55 and preparing for retirement?

Anyway, lots of good suggestions from Leper and Steven. However, I am not sure I would agree with all of the generalizations.

Leper said:
. Don't even think of an Afterlife loan.
Click to expand...

I wouldn't myself as we don't need it. But I see no reason why retirees in need should not consider it (eg, to bring their house up to a comfortable standard). I would say too many retirees think about preserving the inheritance rather than their own comfort and wellbeing.

Leper said:
Clear your credit card debt every week
Click to expand...

It is only a small point but I am not sure I get the above.


"As for needing less income? The people I see who are really enjoying their retirement are spending more now than when they were working." (Steven's Blog).

I think this is a major overgeneralization. No doubt it applies to many but to many others it does not. Going to work costs - I suspect many working couples who changed to working from home in recent years have found this. And the favourite hobbies and pastimes of many are not majorly expensive. Many people enjoy a great retirement on considerably less income than when working. You have to take your proposed, and preferable, lifestyle in account when planning for retirement.

I would add that planning for retirement should be a joint exercise if you are part of a couple. There may be a lot of implicit and incompatible expectations for the retirement years.

Also, and speaking as someone who loves retirement, I would say it is a major challenge for some people. If your identity and life purpose centres on your work then all the travel, holidays, relaxation, etc, etc, in the world is not going to make up for it. Gradual retirement or alternative employment/engagement opportunities should be considered.
 
Leper said:
13. Don't even think of an Afterlife loan.
Click to expand...

Brendan Burgess said:
I met someone recently who was cashing their pension to give their son some money. The son was earning far more than the mother. And she will need it far more than he ever would. I had not realised it was a common mistake.

Brendan
Click to expand...

Spoke to an 85 year old this morning who gifted her two children money a number of years ago as an early inheritance. Her investments didn't work out (no idea what she was in) and she is now considering a reverse mortgage to give her an extra few quid. Kids have already gotten money from her as their inheritance. I just told her to get the numbers first so she can make an informed decision and discuss it with her kids before committing to anything.


Steven
www.bluewaterfp.ie
 
ClubMan said:
@Steven Barrett, is this sort of treachery common in your experience?
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What? Parents giving adult children money? It is very common these days. Boomers have accumulated a lot of wealth. Even where their children are successful themselves, they want to help out their kids financially. If they have enough money, there is no harm in doing so. Otherwise, it is left until they are dead and they will get no joy out of helping their children out then.

But the big change that I am seeing is boomers are much more measured in the amounts that they are giving. During the Celtic Tiger, parents were borrowing money to help their kids out to get property. I know of plenty of cases where the parent bought the property for the child and gifted it to them, repaying the debt themselves! I don't see any of that now.
 
The main reason I started this thread is my experience of helping people do sensible things they have let slip for years. This probably stems from my days of being an unpaid local trade union rep and my credit union days as a volunteer trying to get people to ditch their dealings with illegal moneylenders. I can’t remember ever leaving Sunday Mass without being asked to help somebody fill out a Dept of Social Welfare form or help somebody in dealing with Revenue. I set up email addresses for people who even find using a mobile phone to be difficult. I have never taken payment or any other award and won’t ever.

The thing is many of these people are retired and get confused easily and find themselves unable to cope. It’s not unusual for me to meet a retired nurse who hasn’t filled in tax details in 25 years including not claiming refund of medical visits and prescriptions. I have dealt with former public/civil service managers who find themselves at sea in some of their dealings. A death of a spouse can spark a descent in standards quite easily. Some of these just accept top up mortgages/loans without question. Some are fearful their offspring will find out and are terrified whatever consequences might arise.

What I’m pointing out is widespread and relatively hidden. Therefore, I’m asking people to review their situation before it becomes an uncontrollable burden. And obviously get in control of their finances before their finances control them. Age 55 is a good time. What I do is not earth shattering but many financial institutions see many as easy targets. So somebody finds me confusing at the best of times. I’ll take that anyday over doing nothing to help somebody. And I’m not worried about semantics either. Coop/coup doesn’t confuse me. Put yourself in the shoes of the affected and think.
 
Leper said:
Every week I meet several people who like me are retired. Best thing about being retired is that every day is like a Bank Holiday. The worst thing is that some kind of financial independence is still a pipe dream or you are financially worse off than you have been. Yours should all be done for, mortgage should be a memory and the next years are now your most important.

I suggest:-
1. Get shut of top up mortgage or any other loans. Remember, you have to do this sometime.
2. Concentrate on your physical and mental health.
3. You've reached "me" time.
4. Review life insurance.
5. Get fitter if necessary.
6. Get your savings in trim even if you cannot beat inflation. You need a Rainy Day fund.
7. Improve anything that needs doing in your home.
8. Don't delay in getting your tax affairs up to date.
9. Slow down now.
10. Drive more carefully if you're not a careful driver.
11. Give time to your family as necessary without being a "hero. "
12. Keep your passport in date.
13. Don't even think of an Afterlife loan.
14. Bring your family onside.
15. Cherish your hobbies (this doesn't mean building a light aircraft from scratch). Reading, Writing, Sport, etc.
16. Avoid any rut.
17. Clear your credit card debt every week (not every month). Use the card less and less where possible.
Click to expand...
Advice for any age
 
Brendan Burgess said:
Hi Steven
That is an excellent post. It should be given to everyone on retirement.

I met someone recently who was cashing their pension to give their son some money. The son was earning far more than the mother. And she will need it far more than he ever would. I had not realised it was a common mistake.

Brendan
Click to expand...
Yes. I think the overriding message on this thread is don't bring debt into retirement and cease all debts earlier than 55 if possible. Also get affairs into order before retirement. The check lists here are relevant and if anybody wishes to add to them please do.
 
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