One of the biggest challenges, when the time comes for us to make this decision (age 55 onwards), is the lack of an easy “rule of thumb” to provide guidance.
The benchmark most used by advisers is the “4% rule”. That suggests that withdrawals of 4% per annum are, on average, likely to be sustainable throughout life. However other studies suggest that a 3% withdrawal rate is a better answer.
My issue with both of those studies is that none of us are the same and I rarely come across anyone who expects linear spending patterns in retirement. Most of us have great plans for the early years of retirement, which require an income stream which would not be sustainable forever, followed by a dip as we get older, and, for some, a surge later as we need more care.
The challenge, therefore, is how to manage a retirement pot, and the required withdrawals, over the rest of our lifetimes.
I feel very strongly that managing that pot, and the withdrawal strategy, is our responsibility and is not something which can, or should be, totally delegated to a financial adviser. You may be fortunate and have a relationship with an adviser who is a talented and genuine lifestyle financial adviser, but they are rare. What is more common is the adviser who is so concerned by the regulatory and compliance aspects of being an adviser that clients are put into neat boxes which can be easily audited rather than being treated as an individual. If you have been recommended to use a risk-rated investment fund that is probably the category your adviser fits into. You may be charged for personal service but that is not what you will be getting.
If you would like to feel more confident in your retirement planning, are open to learning how to use all the guidance and information available to you, and are prepared to make decisions for yourself once you have the right level of knowledge/ information, I am sure you would benefit from and enjoy a complimentary 30-minute Zoom conversation whether or not we decide to have an ongoing business relationship. Just use this link to book your slot.
This is your money and your future both of which deserve your attention.
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Retirement Risk Zone: If you are in what I call “The Retirement Risk Zone“ – the three years before retirement and the three years after – this is a particularly important time for you, so do please get in touch. Just use this link to book your Zoom chat. Make the wrong decision, or no decision, now and it could have a major impact on your lifestyle for the rest of your life.
PS. This may not be the time for you to give this your attention but if you have friends, colleagues, or family for whom the time is right please ask them to get in touch. rhcook1943@gmail.com or 07770575122
IMPORTANT INFORMATION
This document and our on going services are not personal advice. We'll give you all the help and guidance you need to make your investment and retirement decisions, but we can't advise you. If you're not sure whether you need regulated financial advice we can put you in touch with a suitably qualified and experienced regulated adviser. Because we are not regulated by the Financial Conduct Authority you will not have access to the Financial Ombudsman Service in respect of any complaints. If you use one of the "no advice" on line services to handle investment transactions they will be Regulated and you will have access to the Ombudsman and The Financial Compensation Scheme in respect of their services. The value of investments/pension plans can fall or rise depending on market performance. The Retirement Team and The Investment and Retirement Coach are trading names of Capture Success Ltd Reg No 01825075 Tel 07770575122
