Retirement is our opportunity to enjoy ourselves after a lifetime of hard work. However, if we are going to enjoy life to the full it is usually going to involve the outlay of money, either for fares and accommodation, for the parts and supplies relating to our hobbies and interests or even to just ensure that we do not have to spend life denying ourselves simple pleasures due to lack of cash.
the importance of planning for sufficient retirement income
Clearly, we all need sufficient money if we are going to enjoy a satisfactory standard of loving in retirement. For the majority of us, building sufficient retirement income is a process that requires expert planning, advice, documented financial plans, and the ability to have the progress towards our financial goals monitored and reviewed by someone who is qualified to do so.
Those who leave retirement savings to chance, or who lack the discipline of a professional financial plan, are running the risk of experiencing a lifestyle in retirement that falls well short of most people’s vision for life after work.
the psychological impact of insufficient income in retirement
To measure the psychological impacts of retirees’ financial circumstances, it’s worth considering the following two groups of people:
financially independent: All or part of their retirement income is self-funded. In some cases, the self-funded component was quite small adding just a few thousand dollars per year to supplement the age pension.
financially dependent: Usually totally reliant on the government age pension and in some cases carry debt into retirement which they were attempting to service in addition to funding the basic necessities of life!
Based on previous studies, only those people who are prepared to live very simple lives, and who are good at managing their money usually indicating that they are able to get by on the age pension. For most others, relying on it as their sole source of income usually means constant worry about unpaid bills, dreading mail deliveries, and even having regular nightmares about their money problems.
People have spoken of running out of money two to three days before ‘pension day’ and the embarrassment of having to curtail social engagements or ask their partner’s permission to spend even a few dollars on a small luxury.
There is little doubt that quality of life is seriously impacted where people are constantly worried about their precarious financial situation.
what can i do about improving my financial situation if I am already retired?
Consulting a financial adviser can help you to properly organise your finances and provide advice about available government benefits. Establishing a day-to-day budget is also a good move so that you can predict expenses and live within your income.