Preparing for the Golden Years and Beyond

As we work our way through our 40’s  and 50’s , through the ups and downs of life,  through the trials and the triumphs, and as we start to stare retirement in the face, have we ever given serious thought to all the problems that this era of our lives carry.

When we are young,  old age appears a long way off into the future, but as we all get older, people will tell you, life passes by very quickly. In the early years people have all kinds of monetary commitments, like mortgages, education costs, household costs and the running of a car and all the other expenses that go with ordinary everyday living. Can you afford to retire at 68? Will you be totally dependent on the state pension or have you put in place an added income for when your money is reduced? Like a private pension or some other stream of income outside of the state pension? Your first reaction will be, we are only barely scraping by, there is no extra cash that could  be saved and tomorrow will have to fend for itself. For those who live on very small incomes, getting older poses many problems. Trying to save for funerals is one of the biggest. ( I only learned recently that the State Death Grant has been stopped, a huge loss to those on meagre incomes, with no savings).

As you get older, avoid status anxiety. Making social comparisons always makes for an unhappy life. Laugh more and resist watching depressing news on TV and in papers. Keep contact with your friends. Make an effort to meet them for a coffee or to go walking or do some other activity. Find green spaces and enjoy the outdoors with its birds, wild life and the changing seasons. Visit family and friends and enjoy the renewal of old acquaintances that you had never time for during your working life. These are all good ways to make retiring more relaxing and happier.

By 2031 the Department of Health estimates that one in five Irish people will be 65 years or older, and the greatest increase will be in the over 80’s. Can our state afford to pay pensions as they are being  paid today? It looks unlikely.  In 2011 changes were made as to how the Contributory State pension will be paid from 2020. From 2020 the amount of pension paid to retirees will be directly proportionate to the number of Social Insurance contributions/credits you have made during your working life. If you were born after the 1/1/1954, when you reach pension age of 67/68 you will have to have worked 30 years to  get the maximum pension. The minimum state pension  will be paid after 520 contributions or 10 years and will be at one third the rate of the full pension.  So,  it is imperative that people make provision for their retirement years. Many people will not know whether they have an entitlement or not, but people should be aware that anyone at any age can contact the Department of Social Protection and request a record of their social insurance contributions.

In 2009, half of all households headed by someone between the ages of 55 and 64, had credit card debt. It would be prudent and wise to get rid of all debts that  are not absolutely essential. Cutting back on wants rather than needs is a good way to start, and this should start at the earliest possible time in your life. That foreign holiday to the sun may be attractive in this weather, but not if you have not excess cash to spend. Find some other way of getting relaxation. Buying  goods that are not really necessary or overspending on personal items that can be done without, are all ways of cutting down on spending beyond your means.  Credit cards have been the downfall of so many families and put them into unwarranted debt, they should be discouraged at all costs, especially for people who like to “splash” out. A good way to live is, if you cannot afford it and pay for it from reserves, don’t buy it. Unless it is absolutely essential and cannot be done without, don’t go into debt for same.

When you die, do not leave behind a myriad of problems that could easily have been solved during your lifetime. We all think that when we make a Will, we have taken care of our responsibilities.  Nothing could be further from the truth. Have you a grave? Have you savings to cover funeral costs? Are you clear about where you want to be buried and what kind of service you would want? These may all seem simple things but can cause a lot of anxiety.   When you die, if all your direct debits,  bank accounts, and knowledge of the whereabouts of all necessary documents have not been shared, you can leave a sorry mess for your spouse, partner or surviving family, who may be at their weakest and most vulnerable.  For a couple, all utilities bills, bank accounts, accounts in other institutions, should always be in joint names. In this scenario, life can go on without waiting for all the legal requirements that must be faced  when someone dies. If not in joint names, all bank accounts may be frozen until probate is received and that could take many months. In the meantime, your spouse cannot gain access to the money to pay funeral expenses and other accruing utility bills.  All direct debits must be changed into the surviving person’s name,  and that can also be frustrating and time consuming. Making a will can reduce or eliminate inheritance tax and also ensures that those who you want to benefit from your assets gain access to them more quickly. Tell family members where your Will can be located to avoid the expense of unnecessary searches.

Plan ahead for impairment, sickness and death. Discuss with family members and share with them what you want to happen if you become incapacitated or die. This will eliminate a lot of consternation and friction between family members when the time arrives,  either when you die or big decisions have to be made about care plans.  Make any alterations to your home that might be a barrier later on. When it happens it will be too late and  the burden will then fall on someone else. If your social life revolves around work or family, you might be setting yourself up for isolation in old age. Engage in activities that will expand your social circle. Keep a good and positive attitude, as that will help with the challenge of aging.

So we might think that living is difficult, but dying can be a very expensive and stressful time, on top of those suffering grief and loss. It is one certainty that will happen, so why not make the aftermath as easy as possible for those left behind.