Life’s Transitions: In Your 50’s

You’re in your 50s – life’s comfortable with the mortgage paid off or close to it, kids on the way out or even gone, and retirement to look forward to. While this can be the ultimate time of your life, ‘me time’, there are some challenges that you might have to face during this decade.

Divorce amongst 50–59-year-olds is increasing in Australia. This means that the assets that you’ve built as a couple are now divided, and your lifestyle and income requirements change. This can be a highly emotional time that takes its toll and can produce long-term effects on you personally and financially.

In addition, some women, in particular, find it difficult after a divorce as some have not had to work or had a career before and now find themselves with half what they had before and a need to fund their lifestyle. Finding a job in your 50s is hard enough but with little or no experience is enough tougher.

If you’re employed and happy at 50, congratulations. Unfortunately, some have been retrenched or lost jobs and find it difficult to find alternative employment. While you have a wealth of experience and knowledge and could do the job with your hand tied behind your back, employers are looking for a young gun straight out of Uni as they’re cheaper and bring ‘fresh ideas’. Lining up at Centrelink wasn’t part of your long-term employment plan.

For some, kids leaving home can be a good thing; with less grumpiness and more space, time and money, it can also be a difficult time for others. Those that have dedicated their lives to ensuring the kids are looked after sometimes find that the kids leaving home means they have to find other things to occupy their time. Interests and hobbies haven’t been considered for some time, and they fall into the ‘empty nest syndrome’ as it’s sometimes called.

While you have empty-nesters on one side, you then also have those nests that remain full. Kids are staying at home longer and longer, which means that you have fewer of those years where you have reasonable disposable income to save for retirement.

Statistics show that if you’re going to have an illness or injury that’s going to mean you cannot work, it’s probably going to happen to you now. With things like bowel cancer, prostate cancer and breast cancer being particularly experienced by those age 50 or older, medical issues are more of an issue and more likely to occur at this time in your life. So, make sure you look after yourself and seek regular check-ups.

While it may sound all doom and gloom, preventative measures, strategies, and options can be implemented to avoid, delay, or even eliminate life’s road bumps like those listed above.

To help you get started, reach out to the JBS Financial team here AND here are some tips to help you get the most out of your50s; see below.

Six Point Check List

Start thinking about yourself and what you want out of life.

This can be hard for many who have lived their lives with kids or partners. You want to ensure that the person by your side is the person that will be there throughout your golden years. Retirement is usually upwards of 20 years, so if you’ve fallen out of love, it’s better to get that sorted now rather than later. Also, knowing what you want will help as kids leave the home so you can turn your attention to things that make you happy.

Have a plan for the kids

One of the big traps that many 50-somethings have is that the kids stay…and stay…and stay, and there never seems to be an end. This is your time, and you must ensure that you have the resources to look after yourself for the future rather than just looking after them now. Help them with a 2-year / 5 years plan to save, buy a house, rent but ultimately move out and become independent. Having the kids at home is fine as long as they are utilising the opportunity in front of them rather than taking advantage. You could even introduce them to your financial planner to get them on the right path early.

Plan your employment.

This is a good time to review your employment situation. Will your current position be viable and fulfilling through to your retirement? Will you need to upskill or even return to study to completely get into a new field? Always have a backup plan, as finding alternative employment in later years can be difficult.

See a financial planner.

With higher disposable income, you need the advice of someone qualified to assist you in working out where you are and what you need to do to achieve the retirement you want. New laws mean that financial advice is charged on a fee for services basis. This allows you to pick the level of service that you want, from a simple projection of what your retirement will look like, to providing strategies to improve your financial position, to ongoing advice so that you fully benefit from changes in legislation, rules and product benefits available up until and even throughout retirement so that you get the best retirement possible.

Superannuation is key.

If you haven’t got enough to retire, you need to focus on superannuation. Salary sacrificing (putting in money before tax) is a great way to build wealth as it puts more money away for retirement, can reduce your income tax, and utilises that surplus cash flow to build your wealth. It may not be for everyone as it will depend on your income level, tax rate and contributions already made, which is why seeing a financial planner is so important. You also have the option to put money in from after-tax monies like savings in your bank accounts but be away that there are limits on the amount you can contribute to super.

Review your insurances

While the likelihood of claiming insurance increases as you get older, the need for insurance usually decreases as this, like your mortgage is reduced or even paid off, school fees are behind you, and the need for ongoing income could decrease. Reviewing your personal insurance will ensure that you have the relevant amount of funds available in the unfortunate event you need to claim to cover your lifestyle while giving you a balance of cash flow to utilise to save for your future.