Hi, Eric from Time to Retire here. Now, we've
all seen the headlines about the UK's government
launching initiatives like that Keep Britain
Working review. That's to keep us in the workforce
for longer. But behind the policy, behind the
buzzwords, there is a bit of a shift happening.
I think the goalposts for our retirement are
moving. Now, asking somebody to work longer.
It's not like a small request. It's not like
being asked to help the planet by splitting your
recycling or using a paper straw at McDonald's.
What's happening here is a deeply personal sacrifice.
And it's a fact. A sacrifice of your most finite.
To ensure we keep working, the government, as
legislated two major hurdles and you have to
cross these before you can touch your retirement
money so we're currently in the middle of a transition
where the state pension age is moving from 66
to 67 and that's happening between April 26 just
gone and April 2028 our plans are already on
the books to push this to 68 by the mid -2040s
with some ongoing reviews looking potentially
at bringing that data even closer. And then there's
the SIP and the private pension age. It's not
just about the state's money that's being delayed.
Now, the normal minimum pension age, or what
you see, the NMPA on your statements, that's
the earliest you can typically access private
SIPs or workplace pensions. It's being hiked
from 55 to 57 effectively. from 6th of april
2028 now by raising these ages the government's
effectively asking for a contribution of two
more years of your physical peak and while the
treasury sees this as a way to save roughly 10
billion pound per year for us a bit of a different
calculation now every extra year you spend behind
a desk or on a factory floor is a year you aren't
spending on your health your family or any of
those bucket list items you've been planning
for decades it's a trade -off where you're giving
up physical vitality of your late 50s and early
60s and you don't exchange that for an extra
few bob in your 80s a time you may no longer
have the health to actually use it So have we
been tricked? We're told that retirement is a
finish line where you finally get to relax but
only once the pot of gold is big enough and your
bank account can grow forever but your health
and your time are disappearing fast. Now I asked
our community if they'd retire tomorrow. on a
tighter budget if they knew that they only had
15 years of good health left. Well, the results
were clear. 82 % of you guys said that time was
more important than money. So let's discuss why
this one more year might... So let's discuss
why this one more year idea might be the biggest
mistake any retiree ever makes. Now, we often
talk about the age of 60 and 65 as just two different
numbers on a retirement quote, but in the real
world, in our world, those five years represent
two very different versions of your life. Well,
think about it. Say you're in the Lake District.
If you retire at 60, doing the lakes means probably
scrambling up capels or walking the perimeter
of Buttermere or maybe having a few wainwrights
in a lakeside boozer. Your recovery time is pretty
fast. A couple of pints in the pub at the end
of the day. You're ready to go again tomorrow.
Now, fast forward just five years later to 65.
And for many, doing the lake starts look a bit
different. Maybe it's a gentle stroll around
the water or a scenic drive to a viewpoint. There's
absolutely nothing wrong with that. But the option
to do the strenuous stuff is starting to slip
away. At 65, your high -impact adventures are
statistically, anyway, disappearing. I mean,
at 60, you aren't just retiring from work. You're
retiring into some of the peak activity years.
Let's be honest about long -haul travel. At 60,
you can usually handle a 14 -hour flight to Southeast
Asia or New Zealand. You can deal with the jet
lag, the cramped seats and the hustle of a foreign
city. You have that resilience to be a traveller.
But at 65 or 70, that same flight could become
a bit of an endurance test. You start looking
for extra comfort, which actually usually means
spending. that extra pension money on a business
class ticket just to arrive without a week in
back pain. Now, if you're 65, to get that perfect
pension pot, you might find you finally got the
money to fly business class, but you no longer
have the needs to explore the destination when
you land. So the question we've got to ask ourselves
isn't how much money will I have at 65? It's
what can I do at 60 and what might I not be able
to do at 65? But don't trade your best years
for a slightly bigger pension net. I was lucky.
I retired at 55, but I know I'm an outlier. So
let's talk about this one more year trap at the
age of 65. And you look at your pension rejection
and think, well, if I stay just in the office
for, tell them 66 instead of 65, that's an extra
£200 a month for life. Now on paper, I might
look like a win. In a spreadsheet, the maths
adds up. It's undeniable, but spreadsheets don't
have knees and spreadsheets. Don't get lower
back pain. That extra £200 a month is roughly
£50 a week. It's designed to buy you more comfort.
Maybe it's a nicer hotel on your holiday or a
higher spec car in the driveway. But here's the
question. What are you selling to buy that comfort?
Are you selling? 250 days of your remaining physical
peak. In your early 60s you're in a bit of a
race really against the biological clock. I mean
in the UK the healthy life expectancy, the years
you can expect to live without a limiting long
-term illness is lower than you think. For many
of us even in our kind of mid -60s this window
is starting to close. Now if you trade a year
of your 60s for an extra £200 a month in your
80s. It's a bit of a lopsided deal, I think.
You're trading a year where you can still climb
a hill in the Peak District, carry your own luggage
through an airport, or even play on the floor
with your grandkids. Now, for that bit of an
extra buffer at an age where your biggest expense
might just be a more expensive brand of tea or
coffee, Because actually you're too tired to
leave the house. You can always find a way to
live on £200 a month less. If you've got a good
pension, you can downsize, you can budget. You
can find joy in the simple things, but you can't
under any circumstance go to the bank. and use
that extra money to buy back the energy levels
you had just 12 months ago. So really think about
it. Do you want to spend your go -go years working
to fund your no -go years? That £200 isn't a
bonus. It's basically a refund on the life that
you're too tired to lead. Ask yourself, is that
extra cash worth the physical cost? Well, let's
look at the numbers in... pounds and pence most
uk retirees find that their spending actually
drops the further into retirement they get and
this is what they call the u -shaped spending
curve so between 55 and 70 are our high spending
times where we're having hobbies we're traveling
a lot more then we got the slowing phase around
70 to 80 where spending really does drop significantly
and for some of us there's the care phase where
spending actually may rise but this is quite
often supported by sale of assets or state support
now are you over saving for a 90 year old version
of yourself where so are you over saving for
a 90 year old version of yourself while starving
The 60 -year -old version of these adventures.
So what if you choose the tight budget option
in my poll? What does this actually look like?
Well, for some that could be downsizing the house.
For others it might be moving to a lower cost
of living area. For others it might be ditching
the second car. It's also worth thinking about.
the retiree discounts now traveling outside of
school holidays midweek eating out deals avoiding
that cost of work related things like commuting
work clothes convenient food on the go you know
research shows that after basic needs are met
the more money actually has a diminishing impact
on your daily enjoyment of life so do this for
me today calculate your active years left now
say you're 60 and your average health life expectancy
in the uk is 77 then you're 17 summers left is
another 10 000 pound in the bank worth one of
those extra summers yeah retirement's not about
being rich it's about being free if you're terrified
of the tighter budget ask yourself if you're
more terrified of actually waking up at 75 with
a massive bank account in a body that won't let
you spend it what is your number not your financial
number but that aids that you refuse to work
past no matter what let me know in the comments
i'll see you on the next one cheers