While the fundamentals of any financial plan should endure for many years, it's inevitable that circumstances will change. The pandemic is most certainly a 'circumstance' that has altered almost every assumption.
I was reminded of this during the week with a story we’ve run on the latest survey about the pandemic’s effect on clients’ retirement plans.
With the pandemic far from over (perhaps it will never be ‘over’, we’ll just get used to it) it is perhaps too early to be certain of how clients plans will have changed.
Surveys so far have shown sometimes contradictory indications of changing client retirement plans. Some suggest little change, some major change and some a bit in the middle.
The latest survey from employee benefits firm Wealth at Work is a bit in the middle.
The headline figure from the survey is that 22% of over 55s say the upheaval from the pandemic has made them think seriously about retiring early.
I know one or two people who have called it a day work-wise and who can blame them? The prospects for a swift return to a ‘normal’ week in the office for most people remain slim although I do believe that in the fullness of time work will return to something like we knew.
In contrast to those who want to retire early, some 13% want to delay retirement. Many of these said they simply enjoyed work and wanted to carry on. Others need to boost missing contributions and cannot afford to retire early.
Personally I’ve always been against forced retirement. Keeping fit, active and engaged in some way in the working economy is good for financial, physical and mental health. The benefits of work are not just financial. Retire when you are ready has always been my philosophy.
I can understand why some who plan to work longer are coming from. With the traditional retirement pursuits of cruises and long holidays far from easy the temptation to delay retirement by a year or two makes sense. Boosting retirement pots has never been a bad idea.
The figure I was most heartened by from the survey was that overall 54% said the pandemic had made no difference to their retirement plans. I would bank on many of these people having Financial Planners. For them a tweak or two to the financial plan is all that is needed. A nudge on the tiller.
A good financial plan should be a robust beast with the ability to change if and when needed. I suspect many planners have found clients want to make only modest adjustments to long-standing plans albeit regular reviews are now far more essential. That's as it should be and is one of the benefits of taking great care in developing a good financial plan.
• The survey of 1,320 adults was carried out by Vital Research for Wealth at Work in June.
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Kevin O’Donnell is editor of Financial Planning Today and a journalist with 40 years of experience in finance, business and mainstream news. This topical comment on the Financial Planning news appears most weeks, usually on Fridays but occasionally other days. Follow @FPT_Kevin