If Shakespeare were still alive today, he would have to rewrite his amusing poem, The Seven Ages of Men. Today, many older adults are not as frail as those described in the Bard’s sixth and seven ages. Medical science and improving living standards have transformed old age dramatically, especially in the last half-century.

Still, for those who want a stress-free retirement, careful planning is required, and it seems that this sound advice is still being ignored by generations of workers who are decades away from retirement.

No two retirements are the same. The amount of money you need in your retirement pot will depend on many variables, including the type of lifestyle you want, the state of your health, your regular expenditure, who else lives with you and what kind of commitments you have, especially to support your children.

Those planning to retire early need to devote some time listening to expert advice on building an investment pot to give you a stress-free retirement. One such expert study was made by the UK pensions and investment business Royal London. I am sure that this research’s findings could apply to most locals who understand the need to plan their finances for the future.

There are, of course, many caveats on the validity of the assumptions one makes when calculating the amount of savings needed to build a healthy investment pot. The Royal London has assumed the pension contributions are fixed every month and that investments grow at five per cent a year, inflation is two per cent and annual investment management fees are 0.5 per cent. Volatility in investment returns and inflation have become too familiar. It would be wise to tweak these assumptions regularly to avoid nasty surprises when it is too late to take remedial action.

Most people expect to retire at age 60, even if in many countries today there is no statutory retirement age as in most cases employers can no longer force workers to retire. For instance, in the UK, the amount of help and resources available for older workers who want to retrain has improved significantly in recent years.

Early retirement is the Holy Grail of many workers tired of the daily routine and stress of commuting to work. A study by insurance giant Aviva found that one in five workers hoping to retire early plan to do so when they hit 55. It also found that two-thirds of those who have retired early are happier for it. So what are the first steps to pursue your stress-free retirement dream?

Choosing a reliable investment adviser is not as easy as it looks. Marketing tactics of some investment experts often hide their predatory objectives

I would say that the first essential is to understand how retirement affects your mental well-being. Forced early retirement is an injustice that affects thousands of workers every year. They are dumped on the human scrap heap by employers who need a hefty dose of emotional intelligence to qualify as business leaders.

Still, if you look forward to retirement, you also need to define what lifestyle you would want in the last two or three decades of your life. The Royal London study identifies three lifestyles for workers to consider when building their retirement financials. A minimum income lifestyle would cover all your needs with a little left over for fun; a moderate one offers more financial security and flexibility; while a comfortable income offers even more financial freedom and some luxuries.

The simplest way to achieve a comfortable retirement is to start saving early, regularly and save as much as you can. Alternatively, you may want to put off retirement for as long as possible to keep your employment income flowing.

Many are now resorting to do-it-yourself investment planning. There is nothing wrong with this strategy if one knows more than just the basics of investment planning. Investment management fees can eat up a large portion of your returns, especially in these low-interest rate years. One piece of advice is to avoid speculative investments, be they made in overpriced real estate, cryptocurrencies or non-investment grade private debt. Choosing a reliable investment adviser is not as easy as it looks. Marketing tactics of some investment experts often hide their predatory objectives.

Unforeseen developments in one’s life can often disrupt retirement planning. A marriage breakdown, a serious illness of a family member, periods of unemployment and time out for parenting or caring responsibilities would undoubtedly create a need to review one’s plans.

The antidote to this uncertainty is to save more when you can to make up for the times you are saving less. 


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