Approaching retirement should be an exciting stage in your life; a time to unwind, travel and take up new hobbies. However, more and more people approaching retirement are having their dreams dashed. Plans to downsize and move to the country or go on that dream holiday are being shelved in order to resolve the financial problems of their children.
Research shows that those 10 years from retirement are facing some life changes, which are very different to those of their parents. As the high cost of living takes its toll and children remain financially dependent well into their adult years, more and more over 50s are supporting their children longer than expected.
A report entitled 'Working Women', reveals that rather than coasting towards a comfortable retirement, women in their 50s are working for longer than ever, in order to give their adult children financial support. On average, parents have given their adult children (those aged over 21) £3,180 in handouts in the past year, with the figure rising to £4,840 for the middle classes (ABC1s).
What you feel may be a small handout, can over the course of time build up to be a considerable amount, which can have a significant impact on your own retirement income.
According to a report by Aviva, three quarters of those over-55s who had provided financial assistance to adult children said it had impacted on their own financial planning. More than a third said it has resulted in them dipping into their capital, resulting in less savings and investments than before. Many have delayed retirement or re-entered the workplace part-time to generate or replace the lost income.
Many of us wouldn’t stop to think about supporting a loved-one and we all know life rarely goes as planned; therefore, if you are approaching retirement, it is vital that you not only budget for any unexpected life changes, but that you take unbiased Financial Advice before you say “Yes” yet again.
Retirement and Investment Solutions have years of experience in advising clients on how best to deal with sudden unplanned costs and can help you protect your valuable retirement capital. The earlier you start considering the possible financial events that could halt your retirement dream, the better.