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Practice makes perfect when it comes to retirement

Practice makes perfect when it comes to retirement

Rightwealth Advisors recently wrote “Retiree in Training: Practice makes perfect when it comes to retirement”

“Are you ready to retire? Are you sure? Think about it before you say, “Yes!

Most of us really look forward to the idea of well-deserved, unstructured free time. A time to do exactly what we please when we please – travel, spend time with family, pursue hobbies, volunteer. Until we get there. The 2018 Global Retirement Reality Report found that only 53% of Americans said they were happy in retirement. Some retirees underestimate how long it takes to adjust to what may be a radically different lifestyle; others miss their friends from work; still others find themselves with too much free time on their hands between grand adventures and visits with the grandkids.

Like all major life events, transitioning to a retirement lifestyle can be a major adjustment and comes with a few hiccups along the way. One day, you may go from your seat at the top as a powerful executive to a lounge chair in your living room with the TV or Fido for company. The point is, without your career to define you, what will?

Finding the answer takes a lot of preparation – emotionally, physically and financially – and a lot of thought. While the financial component is critical to a sustainable retirement, so is your quality of life. Too few people consider the psychological factors, which include letting go of your career identity, shifting social networks and spending more unscheduled time with your spouse, as well as the need to find new and engaging ways to stay active.

It’s crucial that would-be retirees invest in their social, physical and psychological needs as well as their financial ones. And that takes planning. Here’s what we mean.

All or Nothing?

It turns out you don’t have to go all-in on retirement. You can transition into it, while still working. In the years before you plan to retire: Practice. Try out different aspects of your proposed retirement and see if they are as fulfilling as you imagined. If traveling is on your agenda, start with extended trips to areas of interest. Pickleball more your cup of tea? Practice now to ensure it’s as fulfilling as you hope. Doing so, while you still have a job, can help with your eventual satisfaction in retirement. You may find you prefer a sort of hybrid retirement that perfectly blends work and leisure into the ideal mix for you.

You’re looking for fulfilling activities that also fill up your time in meaningful ways. Having an emotional connection, a purpose, to your activities helps motivate you and creates a sense of contentment. So it’s important to really give some thought to what makes you happy. Allow yourself the luxury of introspection and give yourself permission to enjoy your 60s, 70s and beyond using the money you’ve saved specifically for this purpose.

Once you have a good idea of what makes life more meaningful for you, take the time to experiment, explore and reflect on both your leisure and work options (e.g., part-time, consulting, moving to a new industry) to find the right balance of time, money, work and play that will become your retirement lifestyle. This work-and-play approach works best for those near traditional retirement age who are willing and able to work longer in exchange for getting a good read on their retirement readiness.

Consider the Work Perks

There are several benefits of continuing to work, in any capacity, while you try on retirement for size. The additional income can help you:

  • Avoid drawing down your retirement savings, allowing time for potential future growth.
  • Start enjoying the retirement lifestyle that will be most fulfilling for you.
  • Pay down unnecessary debt or splurge on a large purchase.
  • Stretch your retirement savings. Even a part-time salary will reduce the amount you’ll need to withdraw. For example, making $10,000 a year is enough to replace a 4% annual withdrawal from a $250,000 portfolio.
  • Delay taking Social Security, until age 70. Each year you wait adds 8% to your monthly benefits.
  • Reduce out-of-pocket healthcare costs since you’ll still be covered under employer-subsidized insurance.

To get into the right mindset, first figure out if you really want to retire and what that may look like. Imagine how you’ll spend your days as well as what a typical day would look like. Ask yourself:

What current activities do I want to continue in retirement?

  • What new things do I want to learn or do?
  • Who would I like to see more of and how often?
  • Where would I like to travel?
  • What role does work play in my life?
  • What brings me joy?

A Change of Pace

Of course, everyone’s vision for retirement will be different, and any decisions about this important phase of life should be based on your financial situation and comfort level. If continuing to work while dipping your toe into the retirement waters appeals to you, run the idea past your financial advisor to determine if the idea is feasible. He or she can help you determine if a more gradual approach could help you adjust emotionally and financially, so you can achieve the ultimate reward: a happy, fulfilling new life.”

If you ever wondered what to do with your time once you retire, click here.

The key to retirement well-being, is to develop a diversified “life portfolio”

The key to retirement well-being, is to develop a diversified “life portfolio”

Steve Vernon wrote “Secrets Of A Successful Retiree: From A Retirement Professional” for Forbes online. He writes:

“What are the retirement planning strategies that an internationally recognised retirement expert successfully has used to plan her own retirement? There’s plenty you can learn from Anna Rappaport, a researcher, consultant, author, and speaker on a variety of retirement planning topics.

Rappaport is also a past-president of the Society of Actuaries and the current chair of its Aging and Retirement Research Initiative Steering Committee. In that role, she puts a special focus on women’s retirement security, which differs in some key ways from retirement security in general.

Recently, Rappaport shared her personal perspectives on and experience with retirement in a guest post written for Nerd’s Eye View, the influential blog from Michael Kitces for financial advisors. Her post, titled “Reboot, Rewire or Retire? Personal Experiences With Phased Retirement and Managing A Life Portfolio,” focuses on the non-financial aspects of retirement. She believes these goals are just as important as creating financial security in retirement.

Rappaport believes that the key to retirement well-being, is to develop a diversified “life portfolio” consisting of:

  • Health
  • People (family, friends, professional contacts)
  • Pursuits (work, volunteering, hobbies, community activities, travel)

Much of current retirement literature and advertising focuses on the “vacation” aspects of retirement, with dreamy pictures of couples walking on the beach at sunset, hand in hand, or holding rum drinks with miniature umbrellas. But Rappaport appropriately points out that a vacation is a break from what we normally do. “People who retire with the idea of an endless vacation are likely to be disappointed or bored within a year or two, if not sooner,” she says.

Rappaport’s post details the various ways that people can continue working, earning, and remaining engaged in their retirement years. She provides interesting insights for people who’ve held senior positions or visible roles during their careers. She advocates making a conscious choice between being known as “me, today” vs. “me, former vice president/director/partner/important title.” She has chosen to be known as “me, today” but describes her extensive former roles in her bio.

Rappaport also advocates planning with the rest of your life in mind. Too often, people approaching their retirement years plan for the “go-go” period of retirement and overlook the inevitable “slow-go” and “no-go” periods of their lives. Sooner or later, spouses, family, and friends will need support and care, and it’s important to be there when they need help. And eventually, you might need help, too, from the social network that you’ve carefully nurtured.

The last lines of Rappaport’s post are compelling: “Some things require a lot of vitality. Do them now while you can. You never know when limitations are coming.”

Some people use these type of thoughts to justify spending lots of money on that cruise to Tahiti they’ve always wanted to take. While that might be fun, don’t blow your savings and end up jeopardizing your financial security in your remaining years.

Better yet, consider Rappaport’s final advice as motivation to work on any unfinished business in your life. This might range from reconnecting with family and friends you haven’t seen in a while to taking up a cause or interest that you’re passionate about or even working on your “bucket list.” It can be one way to lead a fulfilling life without spending a lot of money.

Rappaport’s wisdom can help older workers and retirees better prepare for an enjoyable and fulfilling retirement. While this post just skimmed some key and unique highlights of her post, it contains many more insights and details, and would be a great read for anyone approaching their retirement years.”

To read the rest of the article, click here.

If you ever wondered what to do with your time when you retire, click on this link.

Shire Retirement Properties (Pty) Ltd, is dedicated to the development of a mature retirement industry for South Africa, with broad sharing of knowledge, best practices, improved transparency and standards – all in the best interests of those who wish to retire with peace of mind.

What to do with your time when you retire

What to do with your time when you retire

Some choose retirement, and some have retirement thrust upon them. When it comes to figuring what to do with the decades of free time facing modern retirees, why not take an inventory of what you find most important, whether it be leisure, socializing, contributing to a community or cause, or pursuing hobbies. Work also may be the most important thing, either for the income or for the sense of identity. Research shows that more than half of people over 60 say they will work after retirement.

Here are some ideas for retirees deciding what to do with their days.

Work as a Consultant

People with skills and knowledge to sell to individuals or companies can become consultants, a job with plenty of flexibility for free time. Consulting requires the ability to market and sell those skills, and it can take a while to build up a clientele.

‘Boomerang’ to Part-Time Work

Some companies are finding that, by hiring back retirees part-time or as needed, they get the expertise of long-time workers, while the former full-timers get to keep up professional skills and develop new ones. It’s best to plan this — sometimes called “boomeranging” — before retirement, but it’s never too late to look.

Start a Mastermind Group

For some, retirement from a day-to-day job just opens up time to try another business. Senior entrepreneurs don’t need to go it alone. Look through your address book, find other smart retirees, and form a mastermind group that meets regularly to share connections, advice, and experience. It’s like having an instant board of directors, while joining a bunch of other boards.

Work at a Non-profit

Many retirees seek to turn work experience into a second career at a non-profit. Organisations tap into people’s desire to find meaningful work that gives back to the community. They partner with groups all over the country, serving as a placement network for “second acts.”

https://en.wikipedia.org/wiki/Category:Non-profit_organisations_based_in_South_Africa

Work in a School

Public and private schools have opportunities even for people without teaching degrees. Teacher’s assistants, tutors, and crossing guards are all needed at schools and don’t require experience as an educator.

Become a Tour Guide

People with outgoing personalities can become tour guides. It’s not necessarily easy. Becoming a licensed guide means passing a background check as well as a rigorous test of arcane knowledge specific to the relevant industry. Although no one will become rich as a guide, some people can have a pretty good time and make money passing on their excitement about where they live.

Work at a Hobby

Work isn’t work if you love to do it, which some retirees discover by turning a lifelong passion into a paying proposition (easier when it’s not the sole source of income). A retiree loved restoring antiques in his garage as a hobby, and now he has a partner who helps him turn old barn doors into shelving and coffee tables for sale. A love of gardening could lead to a job in a plant nursery; a love for animals could translate into a reception job at a vet’s office.

Travel in a caravan

Freewheeling seniors can take advantage of a loose schedule by touring the country in a caravan. Whether to buy or rent depends on whether this is going to become a lifestyle or just a one-time caravanning holiday. Having a built-in kitchen and bed can save on meals and hotels during long-term travels.

Visit National Parks

South African National Parks (Sanparks) offer discounts on normal tariffs to people 60 years and older provided the reservation is made in the name of the qualifying person. Social pensioners are those receiving old age, family and disability allowances as well as blind persons.

https://www.sanparks.org/

Take Advantage of SAARP Benefits

One of the greatest advantages of retirement is the ability to go traveling at the drop of a hat (or the sighting of a great deal), with no work or school schedules to get in the way. SAARP offers discounts to make your holidays much more affordable.

https://saarp.net/

Go to Camp

Another way to get away from it all is to go to camp — a camp meant for seniors. Some concentrate on basic camp experiences, such as archery, boating, and campfires, while others focus on particular activities such as wine tasting, bird watching, or the arts. Some are adults-only, and some offer shared experiences with grandchildren. Adult camps aren’t necessarily in the summer, and some last for only a weekend, including some pricey fantasy camps that indulge the inner child and let grownups be cowboys or train for spaceflight.

Become a Road Scholar

Educational travel adventure tours that let grandparents bring grandchildren along, is also popular amongst the over 50’s. The tours encourage learning and interacting with people wherever members go, not just sightseeing. Some trips to remote locations involve hiking, canoeing, or a lot of walking and climbing, which are indicated so people with limited mobility can assess whether a trip will be appropriate.

https://www.tourradar.com/pa/seniors-d-south-africa

Take Advantage of Rail Discounts

Luxury takes on a new dimension with The Blue Train or Rovos rail. You’ll feel it the moment you step into the pre-departure lounges in Pretoria or Cape Town. A warm-hearted South African welcome – taking guests through some of the most breath-taking countryside to be found anywhere in the world.

https://www.luxurytrains.co.za/

Teach ESL Abroad

One way to experience another country without having to shell out for so many travel expenses: Get certified to teach English as a second language. Demand for ESL teachers is high.

https://www.lifefromabag.com/guide-to-teaching-english-abroad/

Teach ESL at Home

There are also plenty of people in this country who need to learn English as a second language. Tutors work with them one-to-one on reading, writing, speaking, and sometimes on just getting by in a new setting. Tutoring requires very little training, although teaching a class requires TEFL certification. Finding volunteer positions is easy, starting with classes, conversation groups, or tutoring at municipal libraries.

Find Volunteering Opportunities at Home

For retirees, a volunteer position can mean supporting a favourite cause, helping people in need, or giving back to the broader community while building new skills, widening social circles, staying engaged, and broadening your point of view. Find a position through volunteer databases such

https://www.projects-abroad.org/volunteer-south-africa/

Build with Habitat for Humanity

Habitat for Humanity has one- or two-week stints in locations all over the world to build housing, upgrade existing homes, help with disaster recovery, or bring stability to children in need.

https://habitat.org.za/

Join the Peace Corps

The Peace Corps is an excellent way to get immersed in another culture while doing good — and it’s not just for young people. The organisation is making a play to recruit more mature volunteers, who bring lifetimes of expertise and experience. The Peace Corps often requires a two-year commitment and proficiency in another language.

https://www.peacecorps.gov/south-africa/

Get Back to Playing Music

Retirement can bring to the fore things you may have puttered around with for years but never had time to really concentrate on. Tony Smith used to play guitar in a band when he was young but let the skill slip as he made a living as a middle school music teacher. Now that he has retired, he’s back on the bar circuit, playing gigs all over Cape Town, including every open mic night he can get to.

Take Up Writing

Even people side-lined by disability or illness can write. If the act of putting pen to paper or fingers to keys is difficult, phones, tablets, and computers have software to turn speech into text. Writing the memoirs of a remarkable (or even ordinary) life can be cathartic for the writer and eye-opening to those who read it. People who have never written before might find it difficult to start such a project, but there’s plenty of help out there from sites such as SA Writer’s College.

https://www.sawriterscollege.co.za/

Rediscover Art

Revive a love of art by taking up drawing or painting. This doesn’t require a lot of supplies to start — for drawing, just a pad and a set of pencils or some charcoal will do. To begin, there are free lessons online on www.art.co.za and other websites, but taking a class opens up a new social circle. Almost every community college has some sort of art classes, and often a senior tuition waiver is available to lower the cost of those classes.

www.art.co.za

Give Photography a Shot

Even a basic point-and-shoot camera is fine for newbie photographers. Photo and camera clubs can pick up from there, offering companionship, mentoring, and a venue for exhibiting work. Talk to people at local camera stores to find out where the nearest clubs can be found, or try

https://www.thephotographyinstitute.co.za/

Turn Textiles into Art

Knitting, sewing, weaving, embroidery, and quilting used to be done in social circles or bees — and they are again. Knitting and fabric stores are often the sites of comradely needle artists, and libraries in some communities also offer classes and a place to share patterns, experiences, and skills. My Dream Course is but one of many websites to visit for classes and online courses

http://www.mydreamcourse.co.za/

Get Fired Up About Ceramics

Wheel throwing takes a bit of strength and physical dexterity, but hand building can be practiced for a lifetime. Ceramics is not the kind of thing that can be accomplished at home, as it requires a kiln to fire pieces, so the art form lends itself to socializing. Classes can be found at most community colleges or art schools.

Make a Movie

Some people turn the simple home movie into a real production. If that sounds familiar, perhaps moviemaking would be a natural fit. Start by auditing a class at a community college or municipal cable access station with basic equipment, where you can discover which part of film you prefer — writing and directing, for instance, or the more technical aspects.

Sound Out Podcasting

The online, downloadable equivalents of radio shows are fairly simple to produce for people who are computer adept and capable of writing and recording a script on a consistent basis — weekly, for instance. The folks at Digital Trends explain how to make any type of podcast, whether it be personal thoughts, a scripted show such as a serial, or a way to highlight music.

Garden for the Planet

Every person with a garden looks forward to having more time to devote to the earth once they retire. Retirees can turn their plots into habitats for pollinators such as honeybees and butterflies, which are disappearing from the planet. This requires abandoning pesticides and growing certain plants to attract the creatures. Life is a Garden has information about how to do that and reap a garden full of butterflies.

https://www.lifeisagarden.co.za/plants-for-the-planet-the-eco-benefits-of-plants-and-gardening/

Garden Like a Master

Take gardening expertise one more step and become a master gardener. Every province has master gardener training that accepts people who are passionate about growing and have some skills to offer – dedicated to promoting all horticulturally related businesses and events in South Africa.

http://horti.co.za/

Take Care of Animals

Pet sitters get to indulge the desire to be around animals, usually dogs or cats, which is especially helpful if the rules of their own home prohibit pets. Local pet-sitting companies often advertise for workers with signs in vets’ offices or stores that sell pet supplies, but retirees can go independent and put up their own signs advertising for clients. Pet lovers who enjoy being outdoors and are strong enough to handle several dogs at once can also be dog walkers.

Foster a Pet

Owning a pet seriously limits the time that can be spent away from home. If a lot of travel is part of the retirement plan, yet you love to have animals around, become a foster parent to a local shelter. Foster homes provide temporary care to rescue animals, those being treated for an injury, the very young, or those otherwise temporarily unfit for adoption into a permanent home.

Look Within

Many people become more attuned to the spiritual as they age, and some studies show that people with deeper spiritual connections have more positive relationships with others, and greater mental and physical health. Churches, synagogues, and other religious institutions welcome newcomers.

Stay Fit

There is little that will keep retirees younger than beginning the exercise regime they always meant to establish. One of the best exercises, requiring nothing more than a good pair of shoes, is walking — even people who have been sedentary all their lives know how to do it. Beginners can start with a regimen such as the one proposed by the Mayo Clinic. If bad weather is a deterrent, joining an inexpensive gym is an option.

Try Yoga or Pilates

Yoga is as an ideal form of exercise for older people. Because it is gentle and there are no jerky movements, it is unlikely to lead to injury. Pilates is a similar form of exercise that is meant to strengthen the core, and the Mayo Clinic says it promotes the flexibility that seniors might start to lose. Although both can be done at home with a video, it’s probably a good idea for beginners to take a class with an instructor who can help with proper form and alignment.

Strengthen Your Personal Bonds

During the work years, a lot of time that could be spent with family gets limited to vacations and stolen moments. Retirement gives people the opportunity to renew family ties and spend quality time with grandchildren, and meet friends for lunches that last as long as the conversation does. Rather than going out on weekends, groups of friends can visit during the week, when gathering places are less crowded.

Leave a Tasty Legacy

Of the many things that can be passed down to family members, the most memorable often have to do with food. A cookbook of family favourites is a good way to bring family members together with shared recipes and memories. Copy centres can bind these recipes together into keepsake books.

Climb the Family Tree

Making a family tree is a chance for each member to tell their stories. Myheritage.com has tips on how to bring historical documents and family artifacts into the tree to make it more meaningful, and where to look for information that goes back further in time than any living member can recall.

www.myheritage.com

Become a Lifelong Learner

The University of the 3rd Age, Cape Town (U3A C.T.) is the springboard from which all U3A activities in South Africa took off.  It was launched at the millennium, has grown by leaps and bounds, splitting itself and giving birth to offshoots along the way. The objective is to offer mental and physical stimulation and socialisation to senior citizens, through opportunities for life-long learning for learning’s sake, in the company of interested peers.

http://www.u3a-ct.org.za/

Or Learn Online

Open Education Database is a directory of thousands of free courses on every conceivable subject from providers of massive open online courses, or MOOCs, and universities all over the world. Although some of these are audio or video lectures, some have full syllabuses with all the attendant reading and homework and the option to earn a certificate (sometimes for a fee), although not college credit.

Learn a New Language

Retirees can take the time to learn a new language, perhaps before traveling to a country where the language is spoken. ITunes U is a good resource for language learning, which can be done at the participant’s own pace. Among the classes available is an MIT OpenCourseWare video class called “Speak Italian With Your Mouth Full,” which combines language and cooking lessons. Languages available range from French and Spanish to Chinese, Arabic, and Russian.

To read more about matters for consideration when preparing to buy into a retirement village, click here.

Shire Retirement Properties (Pty) Ltd (Shire) is based in the Western Cape Province of South Africa and specialises in the provision of a range of services focused exclusively on the retirement industry.

 

Advice to down-scaling couples

Advice to down-scaling couples

A resident – Marius Kritzinger, who lives at The Somerset Lifestyle and Retirement Village, wrote the following:

“What advice can my wife and I share with those who are thinking about scaling down and making the brave move to a retirement village?

  • Once you have decided to scale down, be positive about it, put your foot down on the accelerator and make your move!
  • Do not wait too long before you move into a retirement village. If you are married or living together as a couple, do so while you both are still fairly healthy and active. Moving from your settled surroundings to a new environment is in itself a traumatic experience. Doing so after the death of your spouse or partner generates more trauma and it gets even worse when you are forced by your children to make such a move.
  • Making new friends and allowing strangers into your private life and habits get more difficult the older you are. The older you get, the more selfish you get. So try to move to a retirement village before you get too old and while you are still young at heart.
  • Make sure that the difference between a life right and freehold property ownership is explained to you in detail by the sales team, and most important that you understand it before you put your signature on any sales document. If in doubt, consult your financial adviser and/or attorney.
  • Be brave and get rid of all the unnecessary “baggage” you have stored or carried with you for the past 40 years or more. Sell it, give it away, donate it to charity, or even throw it away. Just do it! You will feel liberated once you’ve done it.
  • Decide beforehand what you want to bring with you to your new house and make sure that it will fit in your house. Take measurements of these and discuss it with the architects in the planning phase of your new down-scaled house. Otherwise you might find that you haven’t got the space for your beloved 200-year-old piano which survived the Anglo Boer War, and now it is far too large for any room in your new home!
  • Approach your move to your new smaller house as an adventure – after all, it is the start of a new and exciting part of your journey through life.
  • Be positive about making new friends and reaching out to other people living in your village. We have met fantastic people in The Somerset and have made many new friends.
  • Please do not get glued down in your new house or unit, but get out of it. Even if it is just to have your lunch in the dining room or joining other residents for happy hour once a week in the club house. Not all people are the same, but there will be one or even a few that you might become friends with. Life is like a fruit salad, and if you do not like the few pieces of pineapple in it, remember it is an integral part of it, because it gives the fruit salad that special flavour!
  • Remember that there are conduct rules that you will have to abide to. These rules are not intended to make life difficult for you – on the contrary, they are there to make life for all living together in a village or sectional title unit comfortable and enjoyable.
  • Get something to keep your mind and body busy. Get involved in a hobby, a book club, in a formal charity project, your own one-man business, or any other activities, actions or projects organised by management. This will do you a lot of good, make you feel wanted and at the same time you will be adding value to your own life as well as to the lives of others. Most importantly, it will keep you away from gossiping and those who thrive on it!
  • Become a member of a big happy family within the retirement fraternity and try not to find fault with every single thing that is happening around you. A positive, constructive attitude in a retirement environment is contagious and will make you a happy person living in a happy place amongst other happy residents.”

To read more about matters for consideration when preparing to purchase into a retirement village, click here.

Shire – Solving Retirement Living Challenges.

 

Major stressors in retirement

Major stressors in retirement

Craig Torr wrote an article for Moneyweb titled: Six major stress factors in retirement and how you can reduce anxiety through effective retirement planning.

Craig wrote:

“While many people dream of a care-free retirement in their so-called ‘golden years’, the reality is that retirement can be a particularly stressful life stage. In fact, the act of retirement itself is considered one of the top 10 most stressful life events. In this article, we examine six of the biggest stress factors in retirement and how you can reduce anxiety through effective retirement planning.

Outliving your retirement capital

Running out of money is a massive concern for many retirees, especially given the poor market returns experienced over the past five years. On the back of low market returns, many retirees have been further financially impacted by the coronavirus and subsequent lockdown, rising healthcare costs, and increasing costs of energy. There are a number of ways in which you can fortify your retirement plan to ensure that you don’t outlive your retirement capital, with the first step being to develop a comprehensive retirement plan, preferably in partnership with an expert in this field.

In developing your plan, you will need to determine your monthly living expenses and build in realistic annual increase assumptions, bearing in mind that healthcare costs outstrip annual inflation year-on-year by about 4%. Another important factor to consider is the extent to which your portfolio is diversified and whether your investments are exposed to the right amount of risk given your investment horizon.

If you’ve retired early, you may realistically be looking at a 30-year investment horizon and being invested too conservatively over such a period can result in your capital losing value in real terms. If you have a blend of discretionary and compulsory investments, you will want to draw down from your investments in the most tax-efficient manner in order to avoid paying unnecessary tax. In addition, you will want to ensure that you draw down from your living annuity/annuities at the correct level to avoid depleting your capital too early or running into cashflow problems later in retirement. Your advisor should give you comfort by doing careful cash flow modelling to determine the most appropriate levels of drawdown taking tax, living costs, inflation and longevity into account.

Death of a spouse or partner

The death of a spouse is regarded as life’s number one stress factor and, sadly, losing a spouse is most likely to happen during your retirement years. While one can never be emotionally prepared to lose one’s life partner, careful estate planning can help alleviate the emotional burden on the surviving spouse. In the absence of an estate plan, grief can be compounded by financial uncertainty, and the effects can be devastating.

Ideally, your advisor should develop ‘first-dying’ and ‘last-dying’ spouse scenarios as part of the estate planning process to determine what the death of one spouse will mean financially for the surviving spouse. This process will include calculating estate duty, CGT, tax and estate liquidity for each spouse, as well as revising the income needs of the surviving spouse. Your advisor will also determine the spousal benefit on any pension or annuity that you have in place, and the extent to which the surviving spouse will be impacted.

Further, your planner should ensure that your respective wills are correctly structured and aligned with your overall estate plan to ensure that no complications or confusions arise later on. Finally, one of the best things you can do for each other is to collate your financial and legal documents in a central file – something which will greatly facilitate the estate winding-up process. A winding-up process can experience major delays where basic documentation such as title deeds, marriage certificates or divorce orders cannot be found.

Ill-health

With ageing comes ill-health, specifically diseases such as cancer, heart disease, dementia, joint disease together with mobility problems. Being realistic about your future healthcare costs means making conservative assumptions about longevity and building adequate medical inflation assumptions into your retirement plan.

In an effort to cut costs, you may be tempted to downgrade your medical aid option, which is not always a good idea as you may end up paying more for out-of-pocket medical expenses than you save on premiums. Allow an experienced healthcare advisor to assess your current medical aid plan while taking into account your health status and existing conditions. Talk to your advisor about the costs of long-term care assuming that you and/or your spouse may need to pay for assisted living, frail care or private nursing at some point in the future.

While you may be in good health now, consider that there may come a time when disease or ill-health can strike, and prepare your retirement plan accordingly. Do your research into retirement villages and homes that offer frail care and assisted living options, investigate the costs involved, compare the costs of frail care facilities versus home care, and put your names down well in advance if you feel that a retirement home or village is an option for you in the future.”

To continue reading the rest of the article, click here.

Shire Retirement Properties (Pty) Ltd (Shire) is based in the Western Cape Province of South Africa and specialises in the provision of a range of services focused exclusively on the retirement industry. To contact us, click here.

Is early retirement what you think it is?

Is early retirement what you think it is?

Chris Mamula wrote an article for MarketWatch: “Nearly 2 years into early retirement, here’s all that I’ve gotten wrong.”

Chris wrote the following:

“All I feel comfortable predicting now is that my future will be different than I thought.

In a comment responding to my recent blog post about making better decisions in the face of uncertainty, a reader wrote: “Life is inherently risky. To try to compensate for every contingency is irrational. We can “what if” ourselves right into a straitjacket! You retired early … you won!”

As a lifelong football fan, this comment reminded me of Super Bowl LI. At the 8:31 mark of the third quarter, Tevin Coleman hauled in a six-yard touchdown pass from quarterback Matt Ryan, putting the Atlanta Falcons ahead of the New England Patriots 28-3.

Game over.

Even with future Hall of Fame coach Bill Belichick and quarterback Tom Brady on the other sideline, there was no chance of New England overcoming a 25-point deficit in a game in which they were being dominated by a formidable foe.

Except they did.

New England scored the last 25 points in regulation to force overtime. Four minutes into overtime, James White ended the game with a two-yard touchdown run. Final score: New England 34, Atlanta 28.

Atlanta took its foot off the gas pedal. It tried to run out the clock. And it lost.

There’s a valuable lesson there that we can all apply to retirement planning. . . It ain’t over ‘til it’s over.

If you’re retiring at the traditional retirement age, you may only be in the third quarter of life. If you leave your career early, like I did at age 41, it may not even be half-time. You haven’t won yet.

Traditional retirement planning, assuming earning no more income and focusing on safe withdrawal rates, is akin to trying to run out the clock. It’s playing not to lose.

Fuel for Investing Smarter

Let’s look at why you should continue to play offense in retirement, especially if you’re planning to retire early.

Preparing for white swans

Author Nassim Taleb popularized the term “black swan events.” Wikipedia summarizes black swan theory as follows:

  1. The disproportionate role of high-profile, hard-to-predict, and rare events that are beyond the realm of normal expectations in history, science, finance, and technology.
  2. The non-computability of the probability of the consequential rare events using scientific methods (owing to the very nature of small probabilities).
  3. The psychological biases that blind people, both individually and collectively, to uncertainty and to a rare event’s massive role in historical affairs.

Many people talk about planning for black-swan events, which by their very definition can’t be predicted and thus planned for. Conversely, my blogging friend Doc G writes on his blog about the idea of planning for white-swan events.

He writes: “White-swan events are much more common but can be no less devastating to a financial plan. So why do we spend so little time thinking about them?”

A few examples of what he calls white-swan events are changes to your health or tax laws. This idea that life and thus spending is dynamic is firmly rooted in reality, in contrast to modeling based on the assumption that retirement spending remains fixed over time, adjusted only for inflation.

I would add another “white swan” that few people like to talk about to his list. Divorce.

Divorce rates are generally decreasing. But for those age 50 and older, the trend is strongly moving in the opposite direction. Researchers have termed this Gray Divorce.

For those who think early retirees are different and early retirement is some panacea, I refer you to Mr. Money Mustache’s eloquently written post about his recent divorce.

In my own case, my wife and I didn’t go down the road to divorce. But the massive life transitions during the first year of my early retirement contributed to the most tumultuous period in our otherwise happy 18 years of marriage.

Prior to going through the experience, I would have never predicted this happening. Which leads perfectly to my next point.

We’re horrible with predictions

Retirement planning requires making many assumptions. We have to predict the unknown. The longer our retirement horizon, the greater our errors become magnified as they are compounded over many years.

Before you try to forecast decades into the future, it is wise to start with a healthy dose of humility. This Freakonomics podcast reminds us of “The Folly of Prediction.”

You need to predict life expectancy. The Atlanta Falcons couldn’t hold on to their 25-point lead for 22 minutes! How much harder is it to develop a plan when you don’t know how long the game will last?

We need to predict economic factors which include future stock market returns, sequence of returns, interest rates and inflation rates. Few of us are economics experts.

Even the “experts” are generally terrible at predicting these things. Studies have shown it is very difficult to predict recessions, interest rates or financial markets.

We need to predict future political conditions that will affect tax rates, the health-insurance marketplace and Social Security.

Most political “experts” couldn’t accurately predict the outcome of our last presidential election the day before it occurred.

We also need to predict ourselves. What will make us happy? What do we really want for our lives?

This intuitively seems much easier than making economic or political predictions. But science tells us otherwise. Harvard psychologists’ studies have shown that “when people try to estimate how much they will enjoy a future experience, they are dependably wrong.”

As I approach two years of early retirement, the only thing I feel comfortable predicting with confidence is that my future will end up differently than I would have predicted.”

To continue reading this article, click here.

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The Japanese doctor who lived to 105

The Japanese doctor who lived to 105

The goals of improved health and financial security are to live longer and, presumably, more fulfilling lives. Increases in longevity have certainly been impressive and has been a trend worldwide. Not only has 60 become the new 40, but we’re well on our way to the day when 80 becomes the new 60.

Tom Popomaronis, Contributor@TPOPOMARONIS wrote an article for CNBC.com about the Japanese doctor who lived to 105 – his spartan diet, views on retirement, and other rare longevity tips.

Dr. Shigeaki Hinohara had an extraordinary life for many reasons. For starters, the Japanese physician and longevity expert lived until the age of 105.

When he died, in 2017, Hinohara was chairman emeritus of St. Luke’s International University and honorary president of St. Luke’s International Hospital, both in Tokyo.

Perhaps best known for his book, “Living Long, Living Good,” Hinohara offered advice that helped make Japan the world leader in longevity. Some were fairly intuitive points, while others were less obvious:

  1. Don’t retire. But if you must, do so a lot later than age 65.

The average retirement age (at least in the U.S.), has always hovered at around 65. And, in recent years, many have embraced the FIRE movement (Financial Independence, Retire Early).

But Hinohara viewed things differently. “There is no need to ever retire, but if one must, it should be a lot later than 65,” he said in a 2009 interview with The Japan Times. “The current retirement age was set at 65 half a century ago, when the average life expectancy in Japan was 68 years and only 125 Japanese were over 100 years old.”

Today, he explained, people are living a lot longer. The life expectancy for U.S. in 2020, for example, is 78.93 years, a 0.08% increase from 2019. Therefore, we should be retiring much later in life, too.

Hinohara certainly practiced what he preached: Until a few months before his death, he continued to treat patients, kept an appointment book with space for five more years, and worked up to 18 hours a day.

  1. Take the stairs (and keep your weight in check).

Hinohara emphasized the importance of regular exercise. “I take two stairs at a time, to get my muscles moving,” he said.

Additionally, Hinohara carried his own packages and luggage, and gave 150 lectures a year, usually speaking for 60 to 90 minutes — all done standing, he said, “to stay strong.”

He also pointed out that people who live an extremely long life have a commonality: They aren’t overweight. Indeed, obesity is widely considered one of the most significant risk factors for increased morbidity and mortality.

Hinohara’s diet was spartan: “For breakfast, I drink coffee, a glass of milk and some orange juice with a tablespoon of olive oil in it.” (Studies have found that olive oil offers numerous health benefits, such as keeping your arteries clean and lowering heart disease risk.)

“Lunch is milk and a few cookies, or nothing when I am too busy to eat,” he continued. “I never get hungry because I focus on my work. Dinner is veggies, a bit of fish and rice, and, twice a week, 100 grams of lean meat.”

  1. Find a purpose that keeps you busy.

According to Hinohara, not having a full schedule is a surefire way to age faster and die sooner. However, it’s important to stay busy not just for the sake of staying busy, but to be active in activities that help serve a purpose. (The logic is that one can be busy, yet still feel empty and idle on the inside.)

Hinohara found his purpose early on, after his mother’s life was saved by the family’s doctor.

Janit Kawaguchi, a journalist who considered Hinohara a mentor, said, “He believed that life is all about contribution, so he had this incredible drive to help people, to wake up early in the morning and do something wonderful for other people. This is what was driving him and what kept him living.”

“It’s wonderful to live long,” Hinohara said in the interview. “Until one is 60 years old, it is easy to work for one’s family and to achieve one’s goals. But in our later years, we should strive to contribute to society. Since the age of 65, I have worked as a volunteer. I still put in 18 hours seven days a week and love every minute of it.”

  1. Rules are stressful; try to relax them.

While he clearly promoted exercise and nutrition as pathways to a longer and healthier life, Hinohara simultaneously maintained that we need not be obsessed with restricting our behaviors.

“We all remember how, as children, when we were having fun, we would forget to eat or sleep,” he often said. “I believe we can keep that attitude as adults — it is best not to tire the body with too many rules.”

Richard Overton, one of America’s oldest-surviving World War II veterans, would have most likely agreed. Right up until his death at age 112, the supercentenarian smoked cigars, drank whisky and ate fried food and ice cream on a daily basis.

Hinohara might not have approved of Overton’s diet, but, to be fair, Overton did credit his longevity to maintaining a “stress-free life and keeping busy.”

  1. Remember that doctors can’t cure everything.

Hinohara cautioned against always taking the doctor’s advice. When a test or surgery is recommended, he advised, “ask whether the doctor would suggest that his or her spouse or children go through such a procedure.”

Hinohara insisted that science alone can’t help people. It “lumps us all together, but illness is individual. Each person is unique, and diseases are connected to their hearts,” he said. “To know the illness and help people, we need liberal and visual arts, not just medical ones.”

In fact, Hinohara made sure that St. Luke’s catered to the basic need of patients: “To have fun.” The hospital provided music, animal therapy and art classes.

“Pain is mysterious, and having fun is the best way to forget it,” he said. “If a child has a toothache, and you start playing a game together, he or she immediately forgets the pain.”

  1. Find inspiration, joy and peace in art.

According to The New York Times, toward the end of his life, Hinohara was unable to eat, but refused a feeding tube. He was discharged and died months later at home.

Instead of trying to fight death, Hinohara found peace in where he was through art. In fact, he credited his contentment and outlook toward life to a poem by Robert Browning, called “Abt Vogler” — especially these lines:

There shall never be one lost good! What was, shall live as before;
The evil is null, is nought, is silence implying sound;
What was good shall be good, with, for evil, so much good more;
On the earth the broken arcs; in the heaven a perfect round.

“My father used to read it to me,” Hinohara recalled. “It encourages us to make big art, not small scribbles. It says to try to draw a circle so huge that there is no way we can finish it while we are alive. All we see is an arch; the rest is beyond our vision, but it is there in the distance.”


Shire Retirement Properties (Pty) Ltd (Shire) is based in the Western Cape Province of South Africa and specialises in the provision of a range of services focused exclusively on the retirement industry. To read more about our services, click here.

Now that’s rock ‘n’ roll!

Now that’s rock ‘n’ roll!

Brigit Grant From Jewish News, wrote on July 12, 2020, 6:32 pm:

“Now that’s rock ‘n’ roll! Care home residents recreate iconic album covers

Sydmar Lodge residents in Edgware pay homage to classic albums by artists including Madonna, Adele, David Bowie and Bruce Springsteen.

When activities co-ordinator Robert Speker, decided to recreate album covers with the residents at Sydmar Lodge in Mill Hill, he had no idea his photographs would go viral in hours and create a media frenzy.

Robert, 41, who has worked at the care home for five years was at work on Sunday when TV and radio stations started calling to ask him about the project which features the home’s Jewish residents replicating the cover poses of artists such as Madonna, Adele, Bruce Springsteen and Rag ‘n Bone man.

Robert, who previously worked at Kisharon was featured in Jewish News when he took resident Shelia Solomons to see Rag ‘n Bone Man and Shelia, who appears in the album collection as Rag ‘n Bone Man complete with tattoos painted on by Robert and as bassist Paul Simonon in The Clash’s album London Calling.

Born and raised in Newcastle, Robert who has been working through lock-down, almost missed the birth of his third daughter, Olivia on June 25 when his wife Aya went into labour while he was at the care home taking the final shot of Hilda for the Blink 182 cover. “My wife is very, very understanding,” says Robert who is always coming up with new ways to entertain the residents.

“I have taken them to the Ritz for tea and I am thinking of ways to get them an outing to a casino. A few weeks ago I hosted a 100th birthday for a resident with her family on Zoom. It was wonderful but sad because she should have had the party she deserved.” With plans to come up with more ways to make the residents happy, Robert set up a go fund me page.

“I did the project to make them happy and I think the models’ families have enjoyed it, with even grandchildren posting about their grandparents, but the risks of Covid means they could be in lock-down for a long time and I want to make it a good time.”

Since posting the covers on Facebook, Robert has been contacted by news agencies across the globe and will appear on BBC News in the morning, CNN and Channel 5 tomorrow. “Then it’s back to Sydmar Lodge to think of ways to keep the residents uplifted.”

To view the album collection, click here.

Shire is proud to provide a range of quality,  independent, personalised services to the retirement market – We look forward to being of service to you. To contact us, click here.

Americans’ Retirement Outlook Largely Intact

Americans’ Retirement Outlook Largely Intact

Gallup‘s reporter Lydia Saad, wrote on 28 April 2020, that Americans’ retirement outlook is largely intact.

  • Most still expect to rely on Social Security, 401(k) for retirement
  • Slightly more say part-time work will supply some income
  • Non-retirees still expect to retire at age 66, on average

WASHINGTON, D.C. – Non-retired Americans’ expectations for what their income sources will be in retirement are broadly similar to a year ago. Most say they will rely to varying degrees on

  • Social Security,
  • retirement savings accounts,
  • regular savings accounts or CDs, and
  • part-time work.

Solid majorities also foresee depending to some extent on home equity and individual stock investments.

U.S. Non-retirees’ Expectations for Sources of Retirement Income – % Major/Minor Source

When you retire, how much do you expect to rely on each of the following sources of money – will it be a major source of income, a minor source of income, or not a source at all?

Apr 2-11, 2018 Apr 1-9, 2019 Apr 1-14, 2020
% % %
Social Security 84 83 88
A 401(k), IRA, Keogh or other retirement savings account 74 80 80
Other savings such as a regular savings account or CDs 67 68 73
Part-time work 65 64 70
The equity you have built up in your home 60 64 63
Individual stock or stock mutual fund investments 52 58 62
A work sponsored pension plan 45 49 51
Annuities or insurance plans 37 40 41
Money from an inheritance 34 39 35
Rent and royalties 34 36 32
GALLUP

Still, non-retirees today may be counting a bit more than they did last year on certain income sources. This includes a six-percentage-point increase, (from 64% to 70%) in those saying part-time work will be a major or minor source of retirement income for them and five-point increases in expected reliance on Social Security (from 83% to 88%) and personal savings accounts or CDs (from 68% to 73%).

Meanwhile, despite the recent economic slowdown and stock market decline stemming from the coronavirus, Americans are no less likely than they were a year ago to foresee relying on home equity, individual stock investments, money from an inheritance or rental/royalty income. And they are no more likely to anticipate relying on a pension or annuities or insurance plans.

These findings are from the 2020 installment of Gallup’s annual Economy and Personal Finance survey, conducted April 1-14.

Americans Don’t Yet Foresee Delaying Retirement

Another indication that the COVID-19 economy isn’t rattling consumers’ long-term financial outlook comes from non-retirees’ estimate of the age at which they expect to retire, currently averaging 66. This is similar to the average expected age of retirement recorded each year since 2009.

The figure was typically below age 65 in prior years, in part reflecting the lower age at which Americans were eligible for their full Social Security benefits. The age of eligibility has been increasing according to a schedule Congress passed in 1983.

Income Sources of Retired Americans

The same poll asks retired Americans about their current reliance on the same 10 retirement income sources.

While self-reports of most income sources did not change in the past year, there has been a slight decrease since 2019 in those relying on individual stock or stock mutual fund investments. Retired Americans also report increased reliance on personal savings and pensions. The current levels are, however, similar to 2018, so it is unclear if the latest changes reflect financial pressure on seniors from the COVID-19 crisis, or just normal year-to-year variation given the smaller sample size of retirees.

U.S. Retirees’ Sources of Retirement Income – % Major/Minor Source

How much do you rely on each of the following sources of income today — is it a major source of income, a minor source of income, or not a source at all?

Apr 2-11, 2018 Apr 1-9, 2019 Apr 1-14, 2020
% % %
Social Security 90 90 89
A work sponsored pension plan 57 49 63
A 401(k), IRA, Keogh or other retirement savings account 61 61 62
Other savings such as a regular savings account or CDs 59 48 60
The equity you have built up in your home 48 47 46
Individual stock or stock mutual fund investments 45 48 41
Annuities or insurance plans 29 35 33
Rent and royalties 18 22 26
Money from an inheritance 22 19 21
Part-time work 18 21 21
GALLUP

Bottom Line

With most Americans still retaining their jobs and taking no hit to their income, many have yet to personally experience the economic effects of the COVID-19 crisis. As a result, their ratings of their current financial situation are down only slightly. And their concern about having enough money for retirement is up only slightly.

To read the rest of the article, click here.

Founded in 2010 by Rob Jones  in response to a clear need in the South African retirement industry for specialist independent consultants, Shire Retirement Properties is focused exclusively on the retirement industry. To read more about the services on offer by Shire Retirement Properties (Pty) Ltd, click here.

Coronavirus: War veteran, 99, wanted to raise £1,000 for NHS – he’s currently on £8m

Coronavirus: War veteran, 99, wanted to raise £1,000 for NHS – he’s currently on £8m

On Wednesday 15 April 2020 21:41, (UK), SkyNews and Chiara Fiorillo from The Mirror, wrote:

Tom Moore has described health service medics as “heroes” and now he’s raised millions for them by walking around his garden.

This 99-year-old veteran has raised more than £8m for the NHS by walking around his garden. Captain Tom Moore had originally hoped to raise £1,000 by walking 100 lengths of his 25-metre garden in Bedfordshire.

More than a quarter of million people have donated and at one point more than 90,000 were on his page at the same time. His aim was to complete it before he turns 100 on 30 April – but he is currently on track to finish by Thursday.

Comments on his fundraising page praised the 99-year-old as an “inspiration” and “a true hero to many”.

Captain Tom Moore has now raised more than £8million for the NHS – and so many people have flocked to donate money that his JustGiving page crashed.

Mr Moore said on BBC One today: “Thank you so much to all you people who subscribe to the National Health Service because, for every penny that we get, they deserve every one of it.”

Originally from Keighley in West Yorkshire, Mr Moore trained as a civil engineer before enlisting in the Army for the Second World War, rising to captain and serving in India and Burma. When he was posted to serve in India in October 1941, it took his Battalion six weeks by sea to arrive there. During his time in south Asia Captain Moore was instructed to start a motorcycling course before the Battalion was moved on to Calcutta – a road journey which took three weeks in Monsoon season. Back in the UK Captain Moore was sent on a course at The Armoured Fighting Vehicle School in Bovington. He was kept there as an instructor until they were demobilised.

Mr Moore began raising funds to thank NHS staff who treated him for a broken hip. His daughter, Hannah Ingram-Moore, told the BBC that the amount raised was “beyond our wildest expectations”.

Hannah Ingram-Moore said: “No words can express our gratitude to the British public for getting behind Tom, for making this into a heartfelt story. He’s a stoic Yorkshireman, he’s an unruffled straight-down-the-line kind of person and has embraced this adventure as the next stage of his life.  I believe that life is all about purpose, we all need purpose, and, whilst he’s had a life full of purpose, he did fall and break his hip and became much less independent than he had been for the preceding 98 years, and what you have done, the British public, and everyone who’s supported him, is giving him his next purpose. He is articulate, he’s alive, he’s doing this and I think he’ll do this until everyone says ‘Stop, don’t do it any more’.”

Broadcaster Piers Morgan has launched a campaign to get Captain Tom knighted for his service to the UK so everyone could “give him something back”.

Captain Moore’s Twitter account posted just before 3pm on Wednesday: “7 MILLION POUNDS!!!! The Great British public, your generosity is just incredible! THANK YOU!!”

Previously, when the amount reached £5m, the account posted: “5 MILLION! Huge thank you to @JustGiving who had over 90,000 people on Tom’s page at one time, and had to try ensure that the site didn’t crash. WOW – just speechless.”

One donor, Mike Davies, wrote: “Great Job, Captain Tom. In these times where all news seems depressing, it’s great to hear the story of a true British hero.”

As of 5pm today, the total money donated on the JustGiving page – which is now back up and running – was £8,032,992.82.

To read the various updates about Captain Tom, click on the following links:

Coronavirus: War veteran, 99, wanted to raise £1,000 for NHS – he’s currently on £3.7m
Coronavirus: War veteran, 99, wanted to raise £1,000 for NHS – he’s currently on £7m
Now over £8m – War hero, 99, sees NHS fundraising page crash as donations soar to more than £8m

Shire Retirement Properties (Pty) Ltd (Shire) is based in the Western Cape Province of South Africa and specialises in the provision of a range of services focused exclusively on the retirement industry. To read more about our services, click here.

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