Once you know how much income you’ll have during your retirement, it’s time to draw up a budget. This can give you an indication of how much you’ll have to live on, so you’ll be able to see whether reality matches your expectations.
By the time you retire, you may well have repaid your mortgage. Your work travel costs will vanish, along with your pension contributions. If your children have flown the nest, the chances are your household bills could be smaller too.
It can be helpful to review both your retirement income and costs to ensure you’re in a comfortable financial place.
Reviewing your pension and budgeting are not the most exciting tasks, but they do pave the way for the big question: what are you going to do with all that time on your hands?
Making sure you’re financially sound for your retirement is vital, but so is your mental preparation. Going from full-time work to full-time retirement could be quite a culture shock.
Your budgeting exercise will show you what type of lifestyle you can afford, so get a plan in place, so the transition isn’t too much of a shock. You’ve worked hard all your life, and now’s the time to do what you want to do. The better prepared you are, emotionally and financially, the smoother the change will be.