Learn about the 3 least talked about risks.
Inflation is up and you are concerned about how far your retirement income will stretch. This is a serious risk but history has proven it won’t last forever. However, there are 3 potential hits to your retirement plan that could last a long time.
Be aware there are significant emotional and psychological impacts with all of these:
One of the challenges is paying the cost of living in a senior's residence and/or long-term care. You may be perfectly healthy but accidents happen and the gradual progression of some diseases will impact your finances. Explore your options in your region or where you plan to retire.
Timing your downsizing is critical to receiving the most money for one of your largest assets, and your contentment in that chapter of life. You enjoy the home you have created and want to stay in it as long as possible. Some communities have plenty of services to help you achieve this goal. However, there comes a time when “it all gets to be too much”. Homes need new paint inside and out, hot water tanks, flooring, appliances, windows, etc. If the thought of downsizing has appeared on your radar, get started on your list of maintenance tasks and updates. Don't wait until your home has become run down. Another opportunity to consider is your new home. While sitting on a comfortable couch in the lobby of a local senior’s residence I was fortunate to chat with Sally. She was relieved that she and her husband had moved into the multi-care residence while she was active. Her husband could get the care he needed, which had become beyond her capacity, and she could make friends, join clubs, and settle into her new neighbourhood. Her few words changed my idea of timing.
The need to help adult children happens for plenty of reasons. There is so much to say here I don’t know where to start as the scenarios are endless. The fact is no one is to blame. You can all work on solutions as a team. This may take some relationship development, boundary setting, role modification, and plenty of grace. Yes, the solutions may impact how much you can spend, how long you work or stay in your home, what activities you explore, etc. BUT being cared for and included is one of our deepest human needs. If you can’t help your kids who is in their corner? I know our culture insists once a child turns 18 he/she can do it on their own forever. I am not convinced this is true or healthy. There are so many benefits to going through life as a team.
To address these risks, your financial plan can be stress-tested. I do scenario analysis to see the financial impact of the above situations. Retirement finances can be complex and it can be difficult to coordinate the various moving parts. You have spent decades saving and now you need to live on pre-set income equations. Be kind to yourself, this is a significant switch in perspective and habits.
You can be much more comfortable when you have a good understanding of which assets and incomes are available to use, when to start, how you will ensure funds for life, and what your options could be should the “what ifs” happen to you.
Visit our website fenskefinancialcoaching.com for more details.
Arrange sessions with Karen at karen@fenskefinancialcoaching.com to enhance your confidence and peace of mind.
