One day, I received a call from my long-time client, Peter. He enthusiastically exclaimed: "Boon Wah, today is my last day of work and I want to treat you to a wonderful meal for rehearsing retirement with me for the last decade!"
I accepted his offer. So what is the actual meaning of 'rehearsing for retirement'?
When we think of retirement, we often envision idyllic scenes of people relaxing on a beach, basking in the sun and enjoying the gentle breeze. However, the reality of retirement can be quite different. It is a major life transition that requires careful planning and preparation. Just like our careers and other aspects of life, strategizing and preparing for retirement well in advance is crucial.
Here, we introduce the concept of "rehearsing for retirement" and explore how actively engaging in the financial, physical, and mental health aspects can lead to a fulfilling retirement.
Financial Aspect:
Financial preparedness is vital for a worry-free retirement, especially for those of us living in one of the most expensive cities in the world. Most of us are accustomed to receiving a regular pay cheque month after month, and the prospect of no longer having that income can be a daunting thought. To address this, consider allocating some of your financial resources into instruments that generate passive income and become comfortable with these arrangements. Ideally, this should be done several years before you retire, allowing you time to become acquainted with the instruments and make necessary adjustments. Diversifying your investment portfolio, this could include real estate, stock or other income-generating assets. By establishing multiple streams of passive income early on, you can build a solid foundation for financial stability during retirement.
Financial insecurity is a major concern for many individuals when retiring. Rehearsing for retirement allows you to address this issue proactively. As you gradually reduce your working hours or transition into part-time roles, you can begin adjusting to a different cash flow and evaluate how it affects your financial stability. This process enables you to make informed decisions about financial instruments and investments without feeling rushed or apprehensive. By having passive income sources in place and being comfortable managing them, you can mitigate the financial insecurities that often arise when the regular pay cheque stops.
Physical and Mental Health Aspect:
Retirement should be a time dedicated to focusing on our well-being and exploring new interests. To ensure a smooth transition, it's essential to prioritize both our physical and mental health. One way to achieve this is by developing hobbies or reconnecting with passions that may have taken a backseat during our working years. Engaging in regular exercise routines is also crucial to maintain good physical fitness and pursue various interests.
As humans, we thrive on social connections and cannot live in total solitude. It is important to spend quality time with loved ones and strengthen our social networks. This can involve reconnecting with friends and family members, joining clubs or organizations aligned with our interests, or actively participating in community activities. These activities not only keep us mentally and physically active but also provide a sense of purpose and fulfillment during retirement. By nurturing these relationships and staying socially engaged, we enhance our overall well-being and create a fulfilling retirement experience.
Why Rehearse?
Rehearsing for retirement allows for a gradual transition into a new lifestyle and helps you adapt to the changes that come with it. By initiating the preparation process 5 to 10 years before your intended retirement age, you provide yourself ample time to make necessary adjustments and explore different avenues. This approach helps you avoid the sudden shock of pressing the "stop" button on your working life and wondering what to do next. Instead, you can embrace retirement with confidence, knowing that you have prepared yourself physically, mentally, and financially.
So there you have it, folks! Retirement is like getting ready for the biggest party of your life, and you better make sure you're prepared to rock it! Remember, it's never too early to start rehearsing for the ultimate showstopper—your retirement! Let the countdown begin!To read up some examples of how you can rehearse and prepare for this, drop us a note at reachus@infinityfa.com.sg
(by Group Senior Financial Services Director: Sim Boon Wah)