If you have trained your progeny well they will, on your command, either cover their eyes for (a) or ears and eyes for (b) and (c).
What got me thinking about age restrictions today? The issue of retirement planning advice dished out in the media.
I have read with great interest the well-crafted series of articles on investments and retirement planning by young journalists, including a few at Business.
When they refer to the “golden years”, or the possibility of retiring before the age of 60, you know what is missing: real life experience.
Think about it: would you take golf lessons from someone who has never played golf, or see a sex therapist who is still a virgin?
That’s why I say: don’t take retirement planning advice from anyone under the age of 60.
Retirement, unless you are very wealthy, very healthy and have a very bad memory, is not going to be golden. And to even think that people can even consider going on retirement in their 50s is just ludicrous. There is a term called “longevity shock” which most of you will hear more often in the future.
Real life experience
Here’s what normally happens to people planning for those “golden years”:
- Sh*t happens. You get married, you get divorced, you split your assets. You pay alimony. Sometimes twice. You didn’t plan it that way, but it happens.
- You lose your job and you whip out your pension fund to stay afloat. So you start all over again with your pension fund.
- You get into debt and cannot get out of it. You cancel your unit trust/endowment/ETF debit order, pull out the cash and don’t start it again.
- You get scammed. Think of the billions of rands lost to property syndicates such as Sharemax, Picvest, Bluezone and others in the past couple of years.
- You go bankrupt through either too much debt or the start-up company you got involved in doesn’t make it past year one, or two or three…. Once again, you didn’t plan to go bankrupt.
- You go to jail. This is most probably one of the most under-reported contributing factors that can destroy a decent retirement. Very few people who end up in jail manage to make it back into the mainstream.
- You sign surety for other people’s debts and they abscond, leaving you in the lurch.
- You make bad investments and it takes years to recover, and in some cases never at all.
I can go on and on and so can most people over the age of 60.
For most – about 95-98% of the population – it’s going to be a battle to ensure their savings last for the rest of their natural lives, which could well extend into their eighties, nineties or beyond.
My receptionist turns 80 soon – a casualty from one or more of the scenarios outlined above – and she is not even thinking about retirement.
I also often advise retirees to continue working, even if it means retraining.
I think society as a whole, and the media in particular, needs to rethink this retirement thing. By all means give good advice and urge people to save and plan for financial independence, but stop selling the impossible dream.
And the next time you see an ad on TV urging you to plan for your Golden Years, close your eyes and cover your ears.
Magnus Heystek is investment strategist at Brenthurst Wealth.