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  • Writer's pictureSage

How to plan for unplanned retirement


According to research by the Financial Planning Association of Australia, 1 in 3 older Australians were forced to retire earlier than they planned.


There are various reasons for this:

· 2 in 5 retired earlier due to serious health issues

· 1 in 8 retired earlier to care for someone with serious health issues and

· 1 in 8 retired earlier because they were made redundant


It is not surprising therefore, that 1 in 4 retirees feel a lack of control in retirement. It is surprising, however, that most of the planning for retirement is left until the last minute.

Having reached retirement age, you’re already well aware of the curve balls that life can throw at you. It is never plain sailing. You understand that at any stage in your life, you can lose your job or you or a loved one can suffer serious health complications.


Yet despite this, little to no contingencies are put in place to ensure you are financially, emotionally, and physically prepared for unplanned retirement.


With retirement potentially lasting 30 years or more, having a sense of control over your retirement is directly linked to high life satisfaction. Life satisfaction is as a result of having control of your finances, your physical health and emotional well-being as you transition into retirement.


So, with this in mind, what should you do, when should you do it and how should you do it?


Let’ start with the WHAT

Start actively thinking about transitioning into retirement. If you are in a full-time job currently, you can begin to look at part-time options, working remotely or even becoming self-employed. Surprisingly only 1-in-4 pre-retirees consider self-employment as an option, despite this offering greater flexibility and mental wellness. This is not to say you have to do any of these things right away, but it is important to identify if there is scope for movement and any opportunities available. The key word here is “options”.


Something else to think about is, are you financially set-up to retire earlier than intended? What should you be saving today and how should you invest your money to generate a retirement income. There are many risks associated with pre-retirees including longevity risk, market risk and inflation risk. Having a diversified portfolio that will buffer you from these risks while providing you with a regular income is an essential part of retirement planning.

Get your health checked. Make sure you attend all your regular screening appointments, stay physically and mentally active and prioritise your health.


Next the WHEN.

This is an easy one, NOW. As we get older, the risks of being forced into an earlier retirement increases. Don’t wait until you here murmurs of redundancy, or you or your partner receive a health scare or unfortunate diagnosis. It is up to you to take control before your health, your employer or your finances do.


And finally, the HOW.

1-In-2 pre-retirees worry about money monthly with 1 in 3 pre-retirees worrying about money daily.


Seeking professional financial advice will help you with the most common concerns:

· How much do I need in retirement?

· How long will my money last in retirement?

· Am I on track to live a comfortable retirement?

· What should I do now to boost my retirement income?

· How much can I afford to spend in retirement?


Specialist retirement advice can put plans in place to help you live retirement on your terms. This includes recommending an individualised retirement portfolio to protect your wealth whilst minimising market volatility.


Speak to your employer about your short-term career aspirations and put plans in place that will allow you the security and flexibility you will need as you approach your retirement years.

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