Plan B warns baby boomers to avoid ‘retirement postponement syndrome’
Wealth management advisory firm Plan B has identified three issues for baby boomers to address if they want to avoid feeling the need to postpone their retirement, that is, to suffer from ‘retirement postponement syndrome’.
The first is for boomers to recognise if they are part of the ‘sandwich generation’ and begin to budget to deal with the phenomenon. This situation occurs when people aged between 41 and 59 are burdened with funding health care costs for their parents while also supporting their own children through university degrees or TAFE courses.
The second is to properly ‘road test’ their investments.
According to Plan B, many boomers assume their investments will cover the costs of their retirement lifestyle without analysing the situation rigorously.
The advisory organisation said: “Road testing your investments, and subjecting your assumptions to proper analysis should form a critical part of retirement planning — and the sooner done, the more time to create a diversified retirement plan, both inside super and out.”
The final issue Plan B has warned baby boomers to prepare for when planning for their retirement is what it calls “economical” retirement.
In the lead up to their retirement many people mistakenly believe the lifestyle they will lead when no longer working will be cheaper than it is presently.
Plan B warned the situation is often the reverse as a result of an increased amount of leisure time available to retirees that allows them to pursue new hobbies and activities.
“Most people know the basic formula when it comes to planning for retirement. Three factors affecting the wealth that investors are able to accumulate are time, rate of return and money saved or invested. But these factors are subject to a host of pressures and competing priorities that can spell the difference between the retirement of your dreams — and just scraping by,” Plan B director Craig Lubich said.
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