Retirement: finish strong or fumble the ball?

As a financial adviser, I see a similar pattern among people in the 50s+ cohort which can have devastating effects.

The situation usually looks like this:

• The couple are coming close to paying off their house or have paid it off.
• The kids are out of home or getting close and their careers are thriving.
• With higher salaries, their super balances are growing.

All in all, things are looking good. But that’s when the cracks start to appear.

The pressure that they need to do something, anything, starts to take hold.

The money starts becoming real. Retirement is in sight and they know they need to take action now but they don’t know where to start.

And then they make a big irreversible mistake which ruins all their hard work.

THE MISTAKE

The mistakes seem to change from person to person and vary in their size and nature.

It might be suddenly deciding you need to set up an SMSF to buy investment properties. Or pouring all of your money into a high risk investment, or taking on a lot more debt.

Whatever the mistake is, it takes them from being on track for a great retirement to completely derailing it.

WHY DOES THIS HAPPEN?

I’ve pondered this question a lot.

In most instances, I think the feeling that you need to take action makes sense.

At this time in your life, even small changes can have big effects. When you’re young, a 10% improvement on your money isn’t a big deal. When you’re older and the numbers are a lot larger, this can have a large effect.

The problem is, there is a lot of conflicting information out there.

THE PROBLEM WITH RESEARCHING YOURSELF

When we are young, we largely all have the same circumstances. We all need a good job, need to buy a house and have a family. Our financial positions are similar so some advice can be applied across most people.

As we get older though, our lives start drastically deviating and advice for people in their 50s+ needs to be hyper specific.

Not knowing what you don’t know, it’s tough to tell:

• What advice applies to you;
• Whether the person giving the advice even knows what they are talking about; and
• Long-term what these decisions are going to mean.

GETTING FINANCIAL ADVICE

Now I’m not going to say everyone needs a financial adviser. You might be the kind of person who is happy to put in the hours of research and feel deeply confident that the decisions you make are the correct ones. If that’s the case, that’s great.

But now REALLY is a good time to get advice. Even small changes can have a big effect on your finances and I’ve never met someone who I’ve said “you’ve done everything, there is nothing here”.

Even if you were doing everything perfectly, isn’t it perhaps worth getting an outside opinion just for peace of mind?

FINISH STRONG OR FUMBLE THE BALL?

If this resonates with you and you’re feeling like you need to take some action, please reach out. Too often people are coming to see me after ‘The Mistake’ and it’s nearly impossible to fix.