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By Michael Doherty
A long life is usually considered to be a blessing: a time to sit back, relax and – in the case of expats living in Cyprus – enjoy your well-deserved moment in the sun. But for many people who don't properly plan for their retirement, a long life can turn out to be something of a curse.
Despite the booming local and global economy, retirement confidence levels are still pretty low these days. This is due to a number of factors. We live in uncertain times: Europe's political landscape is changing, the current US President regularly denounces long-time allies while lavishing praise of former foes, the UK housing market is slowing and growing uncertainty over Brexit has weakened Sterling.
Brexit is of particular concern for expatriates in Cyprus. While it's still likely some sort of deal will be compromised before March 29, 2019 when Britain is due to formally exit the EU, deep political divisions about how to leave the single market has made the doomsday scenario of a 'no deal' Brexit a real possibility.
With all this uncertainty in the air, it has never been more important to plan for your retirement. But instead of cobbling together unrealistic figures and projections for some far-flung date on a calendar, begin by asking yourself these simple questions, the answers to which will have a profound effect on how you want to live in the future:
What do I look forward to doing most when I retire?
Try to imagine what your ideal retirement will look like. It may seem simple, but I've worked with far too many people who never took the time to really think about what matters most when it came to plan their retirement. Think about the things you currently love doing and would like to have the opportunity to devote more of your time and resources toward. How often do I plan to travel? Will I take on new hobbies or recreational activities that have some expenses associated with them? Do I intend to spoil my grandchildren rotten and put aside some extra money for them?
How long will my retirement last?
The million-euro question and one I regularly ask myself (and frequently arrive at different answers, depending on my mood!) It is not, of course, an easy question to answer, but the reality is that life expectancy must play a major role in our retirement projections. The longer we live, the more we must put aside now to pay for our retirement.
The high life, or a simple life?
It's important to consider what type of lifestyle you want to live when you do decide (or are forced) to stop working. Some retirees look forward to taking it easier to reduce expenses and embrace the simple life: grow your own vegetables, ride a bike, take long walks, read a good book. Others take a different view and regard retirement as an opportunity to do all the things they couldn't do while they were chained to the office: enjoy a long cruise, see the world, eat out more, explore expensive hobbies.
Where will I live?
Despite uncertainty over Brexit, more and more couples are choosing to follow their dream of retiring abroad. For many, Cyprus is a perfect match: beautiful weather, low cost of living, low crime rate, widespread spoken English, member of the EU. There are various tax issues expatriates face when moving to Cyprus, but with specialist advice from an independent adviser you can make your money work for you and make the most of the opportunities available to you.
Where can I find the best advice?
When planning for your retirement it's important to get the best expert advice there is. Always take independent financial advice if you are unsure, but make sure your adviser is fully regulated and fully licensed. Woodbrook Group are experts in this field. We offer a free pension review, helping clients plan for the future. We can help you understand your options, how to address your income needs in retirement and how much wealth you will need to support it. Proper advice is particularly important for ex-pats since they are likely to have worked for employers in several countries, making it harder to keep track of pensions. Research shows more than a third of expats have misplaced their pension pots. If you are in that unfortunate position you should consult an independent financial adviser with cross-border knowledge.
Preparation is the key, but don't wait until it's too late. Ask yourself the important questions now: it'll go a long way towards unlocking the answers you need to enjoy a happy and prosperous retirement.
Michael Doherty is CEO of the Woodbrook Group
*For more information, contact our team at the Woodbrook Group Office in Limassol:
Berengaria 25, 25 Spyrou Araouzou, 6th Floor, 3036 Limassol, Cyprus.
Telephone: +357 25272820
Website: www.woodbrookgroup.com
Email: [email protected]
