4 Questions to help you move forward with your retirement planning in a Covid-19 world.
It’s not easy to think about your future retirement in the middle of a global health and financial crisis.
But while the road ahead may seem bumpy, it’s important to focus on what you can control.
Creating or reviewing your retirement plan will help you stay calm, make smart decisions and meet the challenges of the ‘new normal’.
To regain a sense of control over your retirement planning, ask yourself these 4 questions.
1. What are your goals?
You’ve probably been thinking about how much money you’ll need for retirement. But have you put as much time into considering what you’ll want to do with it?
Growing your money is important, but identifying clear goals will give you a better sense of how much money you’ll need.
2. How long will you work for?
A key factor in setting retirement goals will be when you leave the workforce. While many people dream of an early retirement, COVID-19’s impact on salaries may lead more of us to decide to work for longer than expected to build up a retirement nest egg.
New Zealand is already a world leader in harnessing the power of older workers. A pwc Golden Age Index found that 78% of New Zealanders aged 55-64 were in the workforce, which was the second-highest figure in the OECD.
Put time into thinking about replacements for work when you do retire, such as volunteering or meaningful hobbies.
3. Do you and your partner have a shared plan?
Kiwi Wealth advisers often see couples who have separate values, goals and plans for the life they want to lead after retirement.
Spending more time at home can put pressure on relationships, and retirees can struggle if all their friendships are tied up with work.
If you’re in a couple, start talking to your partner well in advance about how you’ll cope with the changes brought on by retirement. It may help to talk to retired friends and family members to find out what helped them and what they wish they had done differently.
4. Have you planned how you’ll cover healthcare costs?
Health issues are a fact of life as we get older, and being able to pay for healthcare is a critical part of being happy in retirement.
While you’re still in good health, start thinking about how to pay for your health needs in future. You might choose to have private health insurance, or to allocate part of your savings to cover anticipated healthcare costs.