Getting a head start with your financial plans in your 50s will give you greater visibility on how your wealth will pan out during retirement.
They say that 60 is the new 50. Some may argue that it is the new 40! We are all living longer, that’s for sure but what hasn’t changed too much is the journey our financial lives take.
Most of us begin our careers in our early 20s and retire at some point in our 60s. This consistency gives you a framework to plan around and a plan that starts to come to fruition when you reach your 50s. It’s at this age where are spotlight guide on retirement starts.
Reaching your 50s: the call-to-action decade
Your 50s is a crucial decade for when it comes to looking after your finances and wealth. It’s the time to put the wind in your sails to make the most of your earning power and accumulate as much wealth as you can before you retire. You will have a clearer idea of how much you need to maintain your lifestyle and how much you can comfortably gift away. By planning early, you will be able to ensure that you are managing your wealth in the most tax-efficient way.
Reaching your 60s: time to review your action plan
Throughout your adult life you’ll have been accumulating a wealth pot, but when you reach your 60s you need to start planning on how you turn that balance sheet of assets into sustainable income. Yet retirement is not one long predictable spending spree. There might be spikes in the early years, perhaps to cover long-desired travel ambitions or helping to fund your grandchildren’s education. And bleak though it sounds, it’s often wise to make provision for higher healthcare costs in later years.
Reaching your 70s: inheritance tax in focus
By now much of the focus falls on IHT mitigation because you will likely have even greater visibility on where you stand financially for the rest of your life. Passing on your wealth to future generations can be a complex issue. It can entwine the whole family and naturally, be emotive. Families are growing in size and complexity – second, third or more marriages are increasingly common and, of course, we are living longer. Put simply, your wealth may have to last for longer, which all adds up for the need to start thinking about when to pass on your wealth.
Reaching your 80s: a time to reflect
If you have prepared and planned for your retirement, it should all be plain sailing in your 80s. It is a time for reflection, not a time to be scrambling around to get your financial affairs in order. It is often an opportunity to help your children or grandchildren – whether it’s for a deposit on their first home, school fees or even saving for your grandchild’s pension. However, when even at the rip-old age of 80, there are a few things you need to be aware of to make the most of your wealth – the seven-year rule for starters.
How Weatherbys can help
There are no hard and fast rules to the retirement options open to you; it will all depend on your individual circumstances and goals. This is where we can help by looking at all aspects of your financial life. As we all know, life does not move in a straight line. During certain phases – and not just retirement – we find ourselves needing to spend more. At other times, we may be in a position to invest significantly larger sums. So, we look at the full picture of your finances as a starting point.
Spotlight on: Retirement Planning