Some people dream of the day they can give up work for good, whereas for others, the thought of entering retirement fills them with dread. According to research from Skipton Building Society, much of that reticence could be down to misguided and outdated ideas of what retirement actually is, as for many, those years will be filled with action and activities – not pipes and slippers.
Using a combination of qualitative and quantitative research – portable skin sensors tracked unconscious reactions to questions alongside verbal responses, while an online survey helped further refine respondent feelings – Skipton was able to get a true picture of how pre-retirees react to images of life after work.
And the results were startling. The research found a dramatic physical and emotional rejection of traditional views of retirement, including increased perspiration and goosebumps when being presented with words and images associated with it. Phrases such as "the end of a chapter" and their "golden years" elicited these kinds of responses, while respondents were far more positive to it being the start of chapter and a chance to remain productive.
The lack of reaction to the traditional image of retirement – cosy pubs, pipe and slippers – suggests people are largely bored with the laid-back image of post-work life, with most having a very different idea of what retirement would be like. Many resolve to stay active, with some even planning to start new businesses or take up extreme sports, showing that retirement doesn't have to be boring.
Dr Jack Lewis, a published neuroscience consultant who was involved in the research, commented on the findings: "For too long, retirement has been about clichéd images, but not anymore. Skipton has shown that, like the modern world, life-after-work is becoming hyper-personalised."
The research highlights the growing desire to move away from the image of retirement being synonymous with old age, but whether you're looking forward to relaxing or are vowing to stay active, you'll still have a few goals in mind – and meeting them comes down to effective planning.
However, a worrying 22% of participants said they had no or incomplete plans in place for retirement, and of those who did, 30% said they had no idea how much money they had saved in order to achieve them. Overall, the study found a high level of anxiety associated with the financial aspects of retirement planning, as nearly two-thirds lacked confidence in their financial preparations.
It's a worrying figure, as it means a large proportion of retirees could find themselves without suitable financial backing as they head into old age. Retirement could easily last two decades or more – that's a lot of years to fund without full-time employment, which is why knowing how you're going to source an income is vital.
So just how can you do that? Well, hopefully, you'll have built up a suitable pension pot during your working life, and now's the time to consider your options. It'll need to deliver an income for a lot of years, which is why many retirees still opt for the guarantee of an annuity, giving them the peace of mind that they won't run out of cash.
However, the pension reforms mean there are far more options when it comes to using your pot, and some may like to opt for income drawdown to stay in control of their pension fund. Then there's the possibility of withdrawing the full amount as a lump sum to make your own investments, although this will require careful planning and the help of an expert.
Of course, you may have separate savings that can be put to good use – perhaps you'll want a savings account that pays interest monthly to supplement your income – or alternatively, what about using your home to help? It's your biggest asset and you could be sitting on (or in) a fortune, so you may like to consider downsizing if your children have flown the nest, or even equity release to free up some cash while staying in your home.
There are plenty of ways you can reach your goals and enjoy an active retirement, but the key is to plan ahead. So, start saving from as early as possible, have a clear plan in place and make sure to seek suitable advice, and you'll be able to enjoy an active retirement with the financial stability you need.
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Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
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