Tuesday, June 09, 2015

Retirement Admin

I am not saying that Marcus is old but friends around me are falling, sometime literally into two distinct categories.

(Note to all, Agata says that Marcus has several decades left in him yet, especially after the regeneration)

A - Dead

B - Retired

Naturally some friends on the brink have been asking for advice on short term retirement actions.  

Pink Floyd: Breathe

Overriding Rule:  
With retirement comes great responsibility.  Responsibility to yourself.  Here are 10 immediate actions 

1. Not Retired

You need to learn to correctly state your position.  Friends, strangers and officials will ask the famed: So what do you do?, question.

Unless you genuinely look like a fossil I'd recommend terms like:

Between Careers, 
Just taking some time out, 
Determining my future, 
I am considering my options.

Declaring early retirement to friends and family can lead to complications.

2. Only Me (Couples Only)

Many couples are together today but with wildly differing ages.  So you might be retiring at separate times.  If you are not naturally retiring within (say) 1 year of each other you have to see if one of you will artificially work longer or the other shorter.  So you can finish together. This should be based on the financials but emotionally one person freshly retired and one still working can work out very bad for the relationship.

3.UK / Country Pension Planning
UK and many other countries have multiple Pension schemes. Often a state (government) pension and an occupational or Private Pension.   The least that you can do is find out what money is stored in what pension, can you continue to contribute to it, assuming you've stopped work before the national retirement age, or maybe you can take money out of the occupational pension.

I'd suggest a pad of squared paper, a pen and an Internet connection.  Dedicate a few weeks to determining your options, then discuss with a best friend or partner. Don't choose only an Independent Financial Advisor (IFA), they still have an agenda, normally their own selling based one.

3. Bloody Kids

Now is the time to remind any children about the Western Ethos that is to prepare your children for a life time of Independent living. Loans for their first house, car, degree funding are not guaranteed.  And more time for us should not be taken as a cue that the bank of mum and dad or its facilities in the wider sense are now available to the kids.

Declare that at worst you are going to provide free Grandparent child support care facilities. Other favours are at your discretion.

4. Your Mortgage / Property

In the classic case, the Bloody Kids have left, your house is now too large, you can safely downsize.  This does not apply to many people!  But if you located your rented or owned property near a particular school, or transport location for work, or indeed a large size for children, evaluate if it still the right property for you.  Do the calculations carefully, emotions, finances, friends, memories, facilities.  It is never just about the money.

5. Fixed and Variable Costs

Most of us don't have an infinite money pot.  Draw up a list of fixed costs and variable costs.  Is there one huge thing, for example a high cost, little used depreciating car that totally dominates your cost of living.  Make a spreadsheet.  Test it out for 6 months and compare it with the actuals.  The Rent, the Petrol Costs, Clothes costs, etcetera.  Based on your savings figure out if or what lifestyle changes / economies need to be made.

6. Clothes

No doubt you have built up a selection of work clothes. Now is the opportunity to prune your wardrobe, taking the most frayed examples to the charity shoppe.

Whilst you might be called on for some consulting in the future, or some after dinner speaking, why clutter up your cabinets at home with yesterdays wear.

7. Tiny List

You should have been anticipating the big End and you will have been composing a list. Not a Bucket list.  A tiny list. The visits to long lost friends, that dental work, your dodgy knee, watching that TV series.  Now with all your time you finally have the opportunity to work on the tiny list of todos.

8. Daily Pattern

Your life might have been dominated by a hectic work schedule.  Now you need to frame a new set of behaviours, doing what you want to do, hopefully with your partner, in your own time.  It can't just be a random set of highs from an infinitely long bucket list.  Think of a structure, both seasonally, and within that down at a daily level.

9. Holiday Planning

It used to be that you crammed in [say] two big holiday breaks per year.  Being busy at work you spent money to get away quickly, relax, and in general have somebody else pamper you.  However now, you have the time to plan a longer vacation, it does not need to be flash, it can be travelling at odd times.   You can cost and not time optimise it.

10.Not Dying

David Gilmour: Breathe Acoustic

It is never too late to perform daily exercise. It will help to keep you alive and make you smile more. No matter how overweight or out of shape you are.  If you have any health defying habits like excessive drinking, or smoking, now is not the time to increase them.  Now is perhaps the moment to start with a daily walk, maybe just a stroll after lunchtime.  Or for the athlete, now you do have time for a daily 2 hour workout instead of just the 50 minute between meetings lunchtime substitute at work. 

Doubly Unusual
UK Pensions
The year of