Experts reveal their top tips
MAKE THOSE IMPORTANT DECISIONS AND THEN YOU CAN KICK UP YOUR HEELS!
The one thing the experts can all agree on is that the best time to start planning for your retirement is today. Good things take time, and a retirement plan covers so many different aspects from financial considerations to health, relationships and social connections. We hope you’ve found this year’s retirement special helpful in breaking down the different aspects – they don’t have to be daunting subjects to talk about. To finish our series, we’ve got some top tips from Kiwi experts who have seen it all when it comes to retirement and are here to help you put your best foot forward!
Timing is crucial in retirement – plan the best years to have fun!
EXPERT ADVICE: Hannah McQueen, Financial Expert from EnableMe – Financial Personal Trainers
“Typically, your best retirement years are 65-72,” tells Hannah. “This is when the fun is going to happen because you’re still young enough to enjoy life.
“After that, your age starts to become a barrier to your options, either because you have run out of money – so you don’t have enough income – or because your health is not what it once was.
“Plan to enjoy life. Design your retirement so you are working with the options to create the most you can with the time you have left. Money becomes a huge part of this process, so take ownership of your finances or get help to do so. Living a good life is about being in control of your money. Looking after your money is looking after you.”
Get your finances in order, now!
EXPERT ADVICE: Diane Maxwell, Former Retirement Commissioner
• The first thing to do is get rid of as much debt as possible, especially credit card debt because of the high interest rates. Knock money off the mortgage as much as possible and try to work out a way of being mortgage-free by the time you are ready to retire.
• If you are not already in KiwiSaver, then sign up immediately. “It’s a no-brainer. Even if you are not working, if you can get just over $1000 in it a year, the government will give you $500,” says Diane. • Don’t wait until you are actually retired to tighten your belt. Do it now and there will be more money in your bank account. “Are you paying the electricity bill in advance to get the discount?” asks Diane. “Making lunches and taking them to work instead of buying them? If you’re buying big items,
such as a car, negotiate the finance on offer. Negotiate your home loan too. With any purchase, shop around, look for offers online and ask for interest-free credit. Make the most of Fly Buys – I have equipped my entire kitchen on Fly Buys. Sell things you don’t need on Trade Me. Buy things you do need on Trade Me. All of these savings will add up further down the track.”
• Get into the habit of “paying it forward” to yourself. Diane explains, “If I am thinking about spending money now, such as buying an item of clothing, I think about myself at 75 and how good it will be to buy a piece of clothing then. I decide not to spend the money today and save it so I can give my 75-year-old self a treat.”
Looking at moving into a retirement village? Don’t leave it too late – or move in too early!
EXPERT ADVICE: Graham Wilkinson, President of the New Zealand Retirement Villages Association
While the average age for moving into a village is around 75 in NZ, everyone is different and you preferably want to make the move while you’re still in reasonably good health.
“Don’t move in too late,” warns Graham. “You want to move in when you still have some mobility, and you can have fun and form friendships. You don’t want to move in when you’re too old and your health means you can’t get out and enjoy things or form friendships, and can end up isolated.
“But sometimes people do move in slightly earlier than what is preferable,” he cautions. “It’s rare, but a change in family circumstances can happen which can mean they have to move away – perhaps to take care of a child or grandchild. But with the way these things are structured, you don’t get any capital gains and exit with a fee – as well as less money. Some people show up at 65 and I normally say, ‘Look, you’ve got years of life left!’”
Take up a hobby – or even a university paper!
EXPERT ADVICE: Stephanie Clare, Age Concern CEO Adjusting to retirement can be a very difficult time. “It’s tough for some – especially if they have a high-powered career,” tells Stephanie. “They finish work, have time off and then think, ‘What do I do now?
What’s my point in life?’” Options for finding a purpose can include helping to look after grandchildren, volunteering, taking up or spending more time on a hobby, starting a business or studying.
“Volunteering is a wonderful thing to do,” says Stephanie. “We’d be belly-up in New Zealand if we didn’t have our older community volunteering. They’re the backbone of many organisations, including
Age Concern.”
Studying is another option – with everything from night school courses and U3A groups to university papers.
“It’s a great idea if there is something you have always wanted to do but didn’t get the chance. The government’s first year of free university fees incorporates our older population if you have never been to university before. Lifelong learning keeps your brain stimulated and helps you to be socially connected, mixing with other students.”
Whatever age you are, draw up a will
EXPERT ADVICE: Greg Kelly, Lawyer
Procrastination – just never getting around to it – is the most common excuse for not having one, but if a person dies without a will, the courts step in, distributing any assets to a strict formula that may be the antitheses of the wishes of the deceased.
But as Greg, a specialist in wills, estates and trust law tells, even if you do have a will, it doesn’t mean things will always go smoothly, so write down all your wishes.
“There might be arguments among the family about whether the deceased should be buried or cremated, or where they are to be buried, or how they want the funeral service run,” he explains.
“It can be very helpful if you have a will that says I want to be buried or I want to be cremated and have my ashes scattered wherever, and I appoint so-and-so to do this.”
While we like to think families will work amicably together, that’s not always the case.
“People think their kids are never going to fight,”tells Greg. “But that’s often misplaced. It’s very common. There might be three or four kids, they’ve all got equal rights, they might all have very different views about how the funeral should be conducted, and there’s arguments about the chattels and memorabilia. If there isn’t a will, people will come up with all sorts of things. Dad said this, Mum said that. A will is a useful way to sort those things out.”