Have you ever thought that retirement is the end of your financial journey? Find out below why it might not be so.

Ah, retirement! All the hard work you have put into your career have brought you to this stage where you can comfortably rest from the constant stress and fatigue from the hectic work life.

However, what do you do now?

While you are no longer subjected to stress generated by work, daily commute, and life in general, and can finally rest, yet sooner or later many retirees face an identify crisis and a loss of purpose due to the unfamiliarity of idleness.

Life in retirement is vastly different from when you had your nose to the grindstone making every sweat drop count. It is likely you have achieved many of your financial goals by now, hence the ability to retire. However, is this the end of our financial journey?

Certainly not, find out below how you can continue your financial journey in retirement and reclaim your sense of purpose.

Goal #1: Build up a stronger safety net for yourself and family

When one door closes, another one opens. Such is the cycle of life and that applies for you in retirement also. You have supported your family throughout the trying times while you were working and most of your children are now all grown up and probably have careers and maybe even families of their own.

Where previously the goal was to accumulate as much wealth as possible, the objective now can be to create an additional safety net for you and your family.

This is because you and your spouse are getting older, and the need for medical services will likely increase moving forward. This is particularly true for those who have lived an unhealthy lifestyle while working and especially so in the city.

Malaysians are increasingly prone to diseases and ailments in old age:

Hence, you should probably think about investing in additional insurance products to protect yourself and your spouse in old age. This includes the likes of:

  • Long term care insurance
  • Disability insurance
  • Life insurance

The increasing difficulties of our next generation to afford houses means that you will probably need to commit some of your money for your children, whether in the form of initial deposit or being a joint name for their housing loans.

The financial considerations for yourself and your family will change when you enter retirement and it is best to consider building a stronger safety net. You might also want o consider how you want to invest in yourself now for your financial future.

Goal #2: Live the lifestyle that you wanted

Now that you are retired, it is time to plan financially for the lifestyle that you and your spouse have always wanted. That means you might not need as many things as you have now.

Ask yourself what are the things that you probably don’t need anymore like:

  • Do you still need two cars for yourself and your spouse?
  • Does your big house still suit your lifestyle and needs?
  • Do you still need four couches and a big dining table?

And now, ask yourself what is the lifestyle that you want to live. With the children all living their own lives now, you can now live the lifestyle that you always wanted.

That dream of buying a motorbike or bicycle, and travelling around the country with your spouse and friends could be a reality now that you have the time for it.

However, that kind of lifestyle will require a different kind of financial planning and investments. Considering your age now, you would need a regular stream of income that doesn’t come from working, but rather from your investments.

It is advisable at this age that you change your investments portfolio to one that regularly generates steady profits and income, and not one that aims to maximise profits.

As such, investments that are safe and not volatile will be important to generate the required income for your lifestyle every year. This includes investments such as;

  • Properties that generate constant stream of rental
  • Blue chip stocks that returns regular dividends
  • Fixed deposits that have guaranteed returns

These type of investments are important to ensure that 1) you don’t work; 2) you still get profits from your capital to support your lifestyle and; 3) you don’t rely financially on your children.

This is the time that you decide what you want to live with and what are the things that you want to move on from.

Goal #3: Embarking on a new education

Remember that conversation you had with your parents before you did your first university degree. Most parents would want their children to take up professions that can generate substantial amount of income.

You would have taken up degrees for professions such as engineering, medicine, finance, business and other more reputable ones that guaranteed a higher income for yourself and family.

However, those were not the things that you wanted to do. When you were young, you were enthralled with the poetry of Shakespeare, the philosophies of Socrates, the breathtaking music of Mozart, or the exquisite designs of clothes.

For some reason or another, you didn’t get to learn or do as much as what you wanted to before you reached retirement. Maybe it was because of the time spent working, or the commitments to your children that you prioritized first.

With you moving on now from those worries and commitments, it is the perfect time to really go further your education in the interest that you kept hidden all these years.

More and more retired people are going back to college to pursue additional educations for themselves. In China, there are over 8 million students in its 70,000 universities focused on enrolling elderly people.

With the proliferation of online learning and courses especially during this time of Covid-19, learning is getting more accessible and cheaper to everyone. Nowadays, you can easily find all kinds of courses in EDX, Udemy, Khan Academy, and many others.

In Malaysia, University Putra Malaysia even offers a specific program that is catered to older people that enables them to learn at leisure and to keep them active and productive.

Furthermore, there is mounting evidence that constant learning as you age maintains your cognitive abilities. According to a blog in Scientific American, participants who were older than 58 years old who took learning classes increased their cognitive abilities to a level similar to a 30 year old in just 1.5 months.

With these evidences and experiences, start preparing your finances and cashflows now to pursue your education in retirement life. Education in Malaysia could cost quite a lot with an estimated RM38,000 a year for a university education, and parents spending almost half of their income on their children’s education. A licensed financial planner or education consultant could help you in making the most optimal financial decision for your education.

Goal #4: Possibilities of a new career and entrepreneurship

You might be or not satisfied with your past career, but one thing is for sure is that you are able to pursue something that you truly wish for yourself after retirement.

After completing that education or course in retirement, you might be passionate enough to be entrepreneurial and establish a new venture or company to pursue it.

You might have a deep passion for stage plays, and enroll yourself to university to learn more about literature.

You feel passionate enough that you want to create a play based on Romeo and Juliet romance plot, but with a Malaysian flavour between two competing Chinese clans in the 1800s. You would need a set of actors and actresses, dialogue writers, production crew and a team of administration and marketing people.

When it comes to that, your financial journey now would be to properly fund and establish your company. It could be your own savings or a joint venture with another partner.

While before this, you were working mainly to support yourself and your family, your financial objective now would be based on your passion in doing what you want to do.

You never know what you can achieve when you wholeheartedly pursue something without the constraints of financial commitments to support your family.

You might be thinking that you are too old already to be pursuing such ventures with low chances of success. Just remember when you look back on this on your deathbed, would you have regrets not pursuing it?

Furthermore, many successful people in the world only became successful much later in life and through indirect routes:

  • Colonel Sanders, the founder of KFC, worked several jobs like a steam engine stoker, insurance salesman, and filing station operator before becoming successful at KFC around his 60s.
  • Ray Kroc, the founder of McDonalds, sold paper cups and milkshake mixers until he was 52, before embarking on the first ever McDonald’s franchise in 1955.
  • Mary Kay, the founder of Mary Kay Inc, sold books and home decor home to home until she was 45, before establishing Mary Kay Inc.

Your financial journey after retirement might lead you to new places, and it is important to be open and prepared for these possibilities. Start thinking and planning your finances now so that you have enough to venture into your passion projects and ventures.

Consulting a licensed financial planner or business consultant in this regard will help you tremendously for your future endeavors, without risking your retirement lifestyle. You should also consider the mindset change that you need to being an employer.

Conclusion

Retirement should not be thought of as the end of your career or your financial journey. If anything, life after retirement is the continuation of your life’s purpose for yourself and it is the perfect time to live out your lifestyle, interest and passion without much constraints.

It is also the time that you can think about how you can further secure your next generation’s livelihood while ensuring that you will not be a burden for them.

You May Also Like

 

What are you waiting for? Get started on your financial journey in retirement!