Four simple ways to keep your retirement dreams on track during a pandemic

Brett Schatto

In the face of growing economic uncertainty and market volatility, there are practical, non-monetary steps that everyone can take to secure a comfortable retirement, Brett Schatto writes.

When people think about retirement, they think about travel, leisure and spending more time with family and friends.

They do not immediately think about money and yet so many people are fixated on the financial aspect of retirement.

Money is, of course, very important and I encourage everyone to start planning and preparing for retirement as early as possible, but it is only one aspect of a comfortable, enjoyable retirement.

In the past few weeks, a number of friends and clients have asked me for advice on what they can do to keep their retirement goals on track, amidst falling interest rates, economic uncertainty and job insecurity.

From an economic perspective, there is not a lot you can do so it is pointless stressing about the state of the economy.

However, there are practical things you can do to remain on course.

In addition to staying healthy and avoiding the Coronavirus, here are my top four tips.

Stay together

My number one tip for couples is to stay together. Ideally, stay in love. (The caveat being unless you are in an unhealthy abusive relationship).

When couples think about retirement, they usually envisage doing things together such as travelling, entertaining friends and looking after grandchildren.

Let’s face it, life is more fun with someone you care about.

As such, nothing can derail retirement plans like a relationship breakdown late in life. Divorce is both financially and emotionally devastating, which is why couples should always be working on their relationship.

In isolation, that may look like watching movies, playing chess or rediscovering the art of home cooking. It will certainly involve spending time talking and listening to each other.

That said there is no glossing over the fact that marriage problems are often really money problems, which is why it is imperative to save and invest wisely for retirement, and seek professional advice.

Use social media and video conferencing technology to stay connected

If the Covid-19 isolation measures have taught us anything, it is how easy it is to use social media and video conferencing technology to regularly check-in and communicate with family, friends, colleagues and clients.

Tools like Skype, Zoom, WhatsApp and Houseparty are not new. Many people, particularly young people, have been using them for some time but it has taken a global pandemic for others to catch up.

While nothing can beat being together in the flesh, the increasing busyness and complexities of life always meant that it was only going to get harder and harder for people to find time to spend face-to-face.

Technology enables people to maintain strong social circles and meaningful interactions.

This is especially important for retirees, given many of the relationships and social interactions people have are work-related.

Fortunately, there is an array of free, easy-to-use tools to help people stay connected, regardless of distance, mobility and finances.

This is critical for combating loneliness, particularly among singles.

A study by Relationships Australia found people over age 65 commonly suffer from loneliness with 7-9% experiencing severe loneliness. The most vulnerable people are those who live alone.

Loneliness has health implications too. The Relationships Australia study found that people suffering severe loneliness had a lower self-assessed health rating and many other studies link loneliness to heart disease, diabetes, depression and substance abuse.

With online tools, retirees can build thriving virtual communities and have meaningful interactions with family and friends every day from the comfort of their own home.

Read widely (but not The Barefoot Investor)

The impact of the Covid-19 health and economic crisis on investment markets has piqued the interest of my son and his cohort of friends, who are in their early 20s.

They are using quarantine as an opportunity to educate themselves about investment markets by reading articles, listening to podcasts and speculating about interest rates, stocks and commodity prices in their group chats.

My son is asking me questions about fundamental principles like diversification, asset allocation and active investing.

He is also reading up on the pros and cons of listed versus unlisted assets in light of the controversy surrounding industry funds and the appropriateness of their large exposure to illiquid assets.

While I recognise that getting through this period will be purely about survival for many households due to the additional stresses of working remotely (for those who still have jobs) and home-schooling children, if you have the capacity to read for leisure or education, make the most of this time.

Whether it is a book about investing or a travel memoir or a lifestyle blog, reading is an inexpensive way to expand your mind and keep alert.

Those of you looking for a book recommendation, I just finished reading School of Life by philosopher Alain de Botton. This book looks at the importance of emotional intelligence, the ultimate skill for this century.

Ensure your wills and estate plans are up-to-date

Effective retirement planning is as much about estate planning as anything else. 

Revisit your wills and estate plans to protect your loved ones after you are gone.

This will give you peace of mind in retirement and ensure that your legacy is not marred by confusion, infighting and greed.

For a range of reasons, it is not always possible for people to contribute extra to their superannuation. However, regardless of the financial circumstances, everyone can do something to lay the foundation for the best possible retirement.