Thinkpiece

01 May Thinkpiece

Welcome to Retirement

So, you’ve worked hard and saved £500,000 in your retirement pot! Congratulations, that’s no mean feat! But there’s a problem. We can often identify with the allure of such a large sum of money and can be persuaded to think we have won the lottery.

As many often discover, this sum can evaporate quickly if not allied with a sensible strategy and discipline. Having money isn’t enough, and how you can make your funds truly work for you.

As Robert Kiyosaki observes ‘It’s not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for.’

 The Illusion of Wealth

Imagine the temptations: a shiny new motorhome, home renovations, dream holidays. Before you know it, that £500,000 could dwindle to a fraction of its original amount.

The first 10 years of retirement can define the following 20!

Setting a strategy for your financial planning

Years ago, I can remember the story of the old person who put money in different pots for different purposes. They would store money for food and provisions in one pot, money for their house and garden in another, and money for luxuries and holidays in another.

Whilst this is a simple example, it goes to show that we should be very selective about where we put our money, based partly on the timing and purpose that we put that money too.

Money that has no immediate need or isn’t likely to be required for major purchases in the next few years, could be put to use in the market, subject to appropriate professional advice.

If we don’t have a strategy and some idea of what we are likely to want to achieve in the long term, all of our focus is on the short term and it is likely that our resources would be completely consumed, potentially leaving us with little for our future.

Smart Spending

Whenever we make a change to our finances, such as spending on major expenses and projects, we can often fail to see the impact that this can have on our wider financial position, or the true risks that we are taking.

Take for example, buying a lovely big house to live in with your family. Now, you may have the funds to buy that house outright. You may have inherited money which would allow you to purchase such a house. But if you haven’t, you’re going to be potentially required to pay a very large mortgage for a very long time.

That will have a direct influence and consequence on your ability to otherwise use those funds that you are now paying on your mortgage, elsewhere, such as funding your retirement or purring into place sufficient provision for your family if you are ill or die.

Making balanced decisions will require a sounding board. A trusted person or adviser that can help you to work out the best way to accomplish your goals and to avoid costly mistakes.

Patience

Financial planning is a journey that requires patience, much like cultivating a garden where growth happens incrementally and consistently.

Successful financial planning is rarely the result of hasty decisions or get-rich-quick schemes, but instead emerges from steady, disciplined strategies that allow investments time to mature and compound.

Individuals who approach their financial goals with patience understand that market fluctuations are normal, and that long-term investment strategies typically outperform reactive, short-term trading.

By maintaining a calm perspective and resisting the impulse to make emotional financial decisions during market volatility, investors can strategically build wealth, diversify their portfolios, and create sustainable financial security.

Patience in financial planning also means consistently setting aside money, and living below one’s means, and understanding that meaningful financial progress is measured in years and decades, not days or weeks.

Working with a trusted adviser is essential to ensuring your long-term financial plan doesn’t take the wrong course of action. This is not a rehearsal.

Perspective

Kiyosaki’s quote emphasizes thinking beyond immediate gratification. It’s about creating a financial legacy that can benefit not just you, but future generations.

 True wealth isn’t about the money in your bank, but the financial freedom and opportunities it creates.

In retirement you need enough purpose to leap out of bed in the morning and enough money to sleep well at night.

Robert Kiyosaki 

Your opportunity

If you’ve not yet put in place a sound financial plan and you’d like to know more, please feel free to contact us on 01626 305318 or via email here.

The value of investments can go down as well as up. You may end up with less back than you have paid in. Past performance is no guarantee of future returns.

The views expressed are not to be taken as financial advice. Professional advice should be sought before proceeding.