When people think about retirement they typically just think about this as one complete stage of life.
Maybe that is because historically it was considered to be for a relatively short period of life, however these days it could be as long as 50 years or half of a person’s total lifetime – that doesn’t sound like one life stage does it?!
Whilst you could divide this into many different categories, in my experience there are more realistically three different stages of retirement that can be considered for most who enjoy a long and hopefully successful retirement.
Early retirement – The ‘Go,Go’ Years
This is commonly the period during which people go from working full-time in their career to no longer working (sometimes in a gradual manner) and then spend the period up until typically around age 75. This is what I would consider to be the fun time of life – having the freedom of time to do the things you enjoy and to spend time or visit the place you want to. This is where spending can be at it’s peak both on an income and capital expenditure basis and I will often encourage to be the case.
Mid retirement – The ‘Go Slow’ Years
The next stage is typically from age 75 to age 85 and what I would consider to be mid retirement. During this period there is a natural and often gradual slowdown of activity, travel and experiences. Sometimes this is due to health, others due to a lack of motivation for new experiences and adventures. There is often a perception that spending also reduces during this period, but in my experience that isn’t always the case as people can often find other things to spend their money on. For example instead of that cruise they decide to spend the equivalent annual amount on a cleaner or gardener.
Late retirement – The ‘No Go’ Years
The timing of this can vary, but is what people would generally consider to be their twilight years and typically is brought upon them either due to age or ill health. During this period activity generally slows significantly, but expenditure tends to go one of two directions – either reduces significantly or can sky rocket (typically related to health and care needs).
As you can read in those descriptions, things can be pretty different both on an activity level but also an expenditure level. Which therefore begs the question as do we do we consider it all to fit under the one category of ‘retirement’ at all?!
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