Could you be closer to achieving your retirement goals than you thought?

July 8, 2024

If you have big ambitions for your retirement, you may believe that achieving them will require long hours of hard work for many years.

While it’s true that consistently adding to your savings and investments is a helpful way to achieve your goals over the long term, it can be easy to fixate on earning more money rather than taking a holistic approach to your overall wellbeing, both emotional and financial. Over time, as your savings and investments grow, you may find it unnecessary to continue to add to them at the same rate.

Read on to learn why you might be closer to achieving your goals than you thought, and what this could mean for your financial plan and wellbeing.

Remember that not all of your goals are financial

When you build a financial plan, you’ll usually start by talking to your financial planner about the goals you have for your life, your retirement, and your family. By forgetting about the money, you can think deeply about what will bring you contentment and joy both now and in the future.

Some of these goals, such as the holiday of a lifetime, your ideal home, or your dream car, will require a financial transaction. But some will be less tangible, such as taking an early retirement or spending more quality time with your family rather than working.

During your day-to-day life, it’s easy to fixate on the financial goals you have, forgetting the impact that the less tangible goals could have on your overall wellbeing. As you make progress towards the financial goals you’ve set, you may be able to alter your lifestyle to achieve your holistic goals related to free time and emotional wellbeing.

As you progress towards your goals, you may be able to tweak your financial plan

When you build your financial plan and curate an investment portfolio, it’s necessary to make some assumptions. Investment returns, inflation, and your own wage growth may be based on guesswork, since it’s impossible to know for certain how they will transpire.

This means that, depending on whether these factors outperform or underperform, the plan you made at the beginning of the journey might need tweaking.

As humans, we’re wired to look for the negatives and to assume the worst – this cautious approach has helped us to survive for thousands of years. But when it comes to your finances, taking this negative stance and assuming you don’t have “enough” to retire or pursue your dreams could lead to you working harder for longer than needed.

When this happens, you risk delaying your retirement to a time when your health may have deteriorated, making it more challenging to enjoy the lifestyle you’ve been dreaming of for so long.

This is why it’s so important to review your finances with your planner at regular intervals. In doing so, you might find that your investments have grown more quickly than you anticipated, meaning you can start to think about your goal of phasing into retirement sooner than you thought. Or perhaps you’re now in a position to begin planning that holiday-of-a-lifetime you dreamt of all those years ago.

Your planner can help you to identify when you have accumulated enough wealth to pursue your goals

This balance between accumulating wealth and enjoying your life in the way you’d like is the crux of successful financial planning. Research reported by Reuters has found that, beyond a certain level of income, people who prioritise building wealth are less happy than those who prioritise meaningful experiences.

Of course, it’s not always easy to know when you’ve reached the point of being able to phase into retirement or start to use the wealth you’ve accumulated. Since investment returns can go down as well as up, you might find the fear of financial loss overwhelming, leading to you continuing to work for longer than you necessarily need to.  

We can help you to identify when you are in a position to shift your lifestyle away from accumulating to enjoying the fruits of your labour using cashflow planning software and our knowledge and experience of financial markets. As such, we can confidently predict whether you are likely to encounter a shortfall in income in the future and help you to address these risks early on.

Consequently, you can feel reassured that your goals are within reach, perhaps even sooner than you first thought they might be.

To learn more about how we can help you with this, please get in touch and we’ll be happy to help.