By Michael Middleton, director with Pro-Vision Lifestyles
The Financial Services sector has taken a battering both from the impact of the global pandemic (the United Kingdom was one of the hardest hit countries of any major European economy) but also Brexit, the resulting exodus of many wealthy individuals from the UK and the rumours that many businesses will follow.
These circumstances highlight the importance of giving people access to guidance throughout their working lives to help them make informed choices and be better prepared for retirement, both financially but also emotionally.
Wellbeing is an area that the financial services sector has not traditionally prioritised and yet employers are among those “best able” to help employees improve their ‘retirement prospects’ in any industry. Realising that “retirement” is a gradual process not an abrupt “here today, gone tomorrow” is essential, and employers have a huge role to play. From the moment we join the workforce we are bombarded with messages urging us to save for retirement, but never to plan for what we want. Company pension provision is often a huge source of this problem.
Saving just for the sake of it is of limited value. Ironically when we are clear on what we want out of life, it is easier to make smarter investment decisions. Yet little if any advice is given by companies to help employees develop future plans.
This is a key area for businesses to help their employees address. Helping people think about and plan their whole life has the added benefits of not just improving their wellbeing, but also helping the business keep them employed in a useful role – breaking the “full time or nothing” mindset too many managers still have.
Retirement is a 130-year-old concept that is long past its sell-by yet it remains something people strive for throughout their working lives, almost as a rite of passage. The reality of retirement rarely turns out to be what we expect, and something most people dread.
So how can the financial services sector start rethinking how they help their staff have a happy and not just a financially comfortable retirement:
- Retirement is often seen as way over the horizon so planning can wait. People need to think about it seriously much earlier, ideally in their 40s. Employers need to engage with their staff sooner and help develop a retirement plan that ensures individuals remain both physically and mentally active as this will benefit both parties now and in later life. Employers have a lot to gain from helping employees identify the things they love to do and keep doing them, the risk of not doing so is that of losing purpose in life.
- A plan is not a simple list of things that would be “nice” to do. It is essential to help employees properly understand themselves, their abilities, whether they want to carry on working in some way beyond retirement, or perhaps using their skills in other ways.
- Too often people leave considering changes they want to make in life until the last minute. One consequence is a difficult or even failed emotional transition to a new life where retirement aspirations are seemingly snatched away. Employers can help staff to see their pension as an enabler for their future which is a time of life that should be one of excitement not dread.
- Running a series of workshops to help people discover more about themselves and how they want to spend their future is a good way to improve engagement with the company pension and also a good way to discuss how people can work more flexibly as they get older.
Companies need to rethink how they see retirement and encourage their employees to see it as an opportunity to discover what they really want out of life and the sooner the better.
Michael Middleton is a director with Pro-Vision Lifestyles (www.pro-visionlifestyles.com) and a financial advisor with 30+ years’ experience. He has helped 100s of people to turn their “retirement” into the most the most fulfilling phase of their working lives!