Do you want to travel the world and live your dreams when you retire If so, start saving now! - Viewpoint - careers advice blog Viewpoint careers advice blog

Do you want to travel the world and live your dreams when you retire If so, start saving now! - Viewpoint - careers advice blog Could you live on £10 a day? Two years ago I lived on the equivalent of the base state pension for a week and it was a real wake-up call as to how important it is to save for retirement. Like many things in life, it is hard to think about the end game when you are only at the beginning. However, just like when considering the future resale value of a car or a house, you need to be thinking a few years ahead. Feeling money confident Having enough money is one of the biggest causes of stress and anxiety Feeling secure and confident about not just your current financial state, but your future situation also has a huge impact on how you go about your job. Having enough money is one of the biggest causes of stress and anxiety, which in turn severely hinders how effectively you are able to do your job. The thought of having no income when I retire, and possibly no further ability to bring money in through a regular job, is scary. Thinking ahead That’s why I felt it was important to raise employee awareness of how important pensions are. Working with experts at Age UK, my team stripped out the costs that we couldn’t avoid â€" housing and travel to work â€" and arrived at a budget of £70 for 7 days.  We had strict rules and my colleagues and I did our best to abide by them. Living in London on £70 per week is not easy. Even the necessities needed a lot of forward planning and saving (the cheapest haircut I could find was £22, nearly a third of my weekly budget). Before we started our week, I asked employees to do two things, write down their aspirations for retirement (what age they wanted to stop working and how they intended to spend their time) and also to keep a record of how much they spent during a “normal” week. Most people were horrified at how much money they got through normally and how much was often wasted. Most people were horrified at how much money they got through normally Unless we start to think forward and plan for the future, retiring at 55 and travelling the world, eating out in restaurants or even just treating the grandchildren, is not going to happen. Unsurprisingly, employee pension contributions increased during the following weeks. What have you budgeted? When working out what you need during retirement try to work backwards. A simple 3 step approach to doing this would be: Work out how much everything is going to cost. For example,  I want to eat out twice a week when I retire. Eating out in a restaurant will cost me £35, so £70 if I do it twice per week. 52 weeks x £70 is £3,640 per year.  I want to go on holiday once a year. A week’s holiday might be £700. I need to eat generally â€" my weekly food bill is £50 so £2,600 per year.  Add in utility bills, clothes, haircuts, emergency funds and then total everything up. (Remember that this is a net figure after tax so you will need to gross up your final net sum to reach the pension figure you need). Look at your current pension provision â€" your employer will help you understand what it may give you â€" and see how closely it meets your total. Now think about other savings you might have, or need to make, in order to help boost this income and meet your retirement aspirations. Lessons learnt Even saving just a little more can make you feel more confident and happy I know that many people currently live on less than £70 per week; people have current financial commitments and it can be hard to save. However, for me it was a salutary lesson â€" I spend too much and waste money on things I don’t need. Most people need to make more provisions for the future, and even saving just a little bit more can make you feel more confident and happy. It’s important for your financial confidence to map out your long-term monetary plans. Knowing that whatever happens tomorrow you have some savings to fall back on helps you to feel secure in your current situation, which in turn allows you to focus all your energy on doing what you’re employed to do. If you enjoyed this blog then you might also enjoy some of the following: 4 ways to grow yourself global Hows your wellbeing? More than fine I hope Are you a global citizen? //