Many of us yearn for retirement but don’t often get the chance for a trial run.
Although the coronavirus shutdown has placed more severe restrictions on movement than anyone is likely to face once they have stopped working, but it is possible to draw some comparisons from the financial consequences.
This short, sharp financial shock is an opportunity to experience how to manage money in retirement.
So far, the quarantine has lasted less than a month but record numbers of people are applying for benefits to help them pay the bills because they have little or no savings.
In the UK, a million people applied for universal credit last week – 10 times as many claims than in a normal month.
Income drops to zero but bills need paying
The problem is simple – income has suddenly dropped to zero but everyday expenses carry on at the same rate.
This is precisely what happens on the day someone retires, with one difference. You will face this struggle every day for the rest of your life, not just while you are in quarantine if you don’t have a financial strategy.
Too many of us live for today and don’t save for tomorrow.
Now, the truth of what this means to our financial futures is hitting home.
The decision is simple.
Put up, shut up and get past facing a grim lifestyle or learn the lesson, curb your spending and start planning for a comfortable retirement.
Use this enforced leisure time to lay your plans. A little time set aside now is a big investment for the future.
Cast an eye over essential spending
You can cast a fresh eye over the spending you regard as essential when you can’t visit the shops, pubs or restaurants. What you can do without can boost your savings for retirement.
You’ll find a lots of little savings here and there which are expenses you can do without now but add up for the future.
Start at the Money Advice Service checklist, which helps work out what money you are likely to have in retirement.
Consumer watchdog Which? is another place to look about basic financial guidance for retirement.
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