Retirement & Financial Wellbeing
Everyone has their own idea of what retirement looks like. But whether that’s spending more time with family, taking up new hobbies, travelling the world, or even just giving up the 9 ‘til 5, saving for retirement is essential.
This isn’t just a straightforward matter of paying into a pension – and it certainly isn’t a problem to consider later in life. For many, pensions can seem extremely complex and confusing, and misinformation is rife, so you need to ensure you’re educated about how pensions work and what you’re entitled to. However, by taking care of your overall financial wellbeing, you can set yourself up for a long retirement and a more enjoyable working life.
Why is it More Important Than Ever to Start Saving Early?
We are living for longer than we ever have. In many ways, this is positive – but it also means we have an aging population, and pensions need to stretch even further. In today’s world, retirement can last for 30 years or more.
This generation, more than any other, needs to be engaged with the responsibility of saving and planning for a long, happy retirement. It is important to take proper care of your overall financial wellbeing, including building up a healthy pension.
What is Financial Wellbeing, and Why is it Important?
Financial wellbeing can mean different things to different people, but at its core it means having enough money to meet your needs now and in the future; being financially prepared for the unexpected; and having the finances to enjoy the things you love.
The importance of financial wellbeing goes beyond just retirement. It will impact all aspects of your life: where you live, how you travel, the luxuries you can enjoy, and ultimately the job you do. If your financial wellbeing is poor, you’re more likely to feel trapped in a job you don’t enjoy or need to work longer hours, which can often result in issues such as sleep deprivation, anxiety, and burnout. In fact, you’re 4 times more likely to suffer from mental health problems if you have financial difficulties.
What Can You Do To Plan For Your Future?
The key to financial wellbeing is budgeting, staying in control of day-to-day spending, and expecting the unexpected. Everyone should understand how to organise their finances, including a strong awareness of their own income and outgoings.
While many of us will plan for short and long term goals, such as holidays, weddings, or house deposits, too few people are prepared for the unexpected – such as illness, the loss of a partner, or redundancy.
There’s no universal solution to achieving financial wellbeing, and everyone will have their own needs and requirements. But, as a guide, having 3-6 months wages in savings can go a long way to providing the additional security you may need.
As a first step, you should understand your current situation – including everything from pensions and life insurance to mortgages and credit cards. Once you’ve established a firm understanding of these areas, you should consider your financial plan. How much do you spend? What is the worst case scenario? How much more do you need for retirement? These questions might not be straightforward to answer, but they’re essential to understanding what needs to be done.
Finally, don’t bury your head in the sand. Financial problems are highly unlikely to go away on their own – and when it comes to retirement, you may not even realise the problem exists until you really examine your finances. Seek out information and advice and take control of your finances.
