Never had it so good?
It was during an otherwise unremarkable Tory rally in Bedford 61 years ago that the British Prime Minister at the time, Harold Macmillan, told Britons that they had ‘never had it so good’.
The optimistic tone of Macmillan’s speech would be hard to replicate now at a time when uncertainties about Brexit, fragile global economies, and an ageing population would immediately undermine such positivity.
However, this doesn’t mean we should blithely submit to negativity. Today we can still be optimistic about our personal futures, but we will need to take control. Confidence in a secure financial future nowadays only comes with planning: you have to work at it and you have to remain committed to your plans. Financial planning has never before been so significant.
Expats can still have it good, too
This new reality is perhaps more true for expat retirees than any other British demographic. For the majority of those who are either already living out their retirements in Portugal, or those planning to, it really may be true that today, in 2018, you have never had it so good.
However, against the background of the uncertainties outlined above, there really is no room for complacency; living in Portugal really may be the dream of paradise made real, but without some level of strategy even paradise has its pitfalls and these can quickly turn dreams into nightmares.
Being sure of your pension
The western world’s whole notion of retirement has recently taken something of a knock. We once thought Defined Benefit Schemes were invulnerable and the golden goose of pensions, but we have now discovered they are worryingly prone to collapse. We also see that the stability of economic markets, and the natural environment that underpins them, can be unreliable and subject to deterioration. These factors are further compounded by the effects of ageing societies and all this places an incredible strain on state and private pensions, as well as state healthcare and other forms of support for an ageing population.
As individuals, we should not depend on government, or indeed on the ‘big society’ of former Prime Minister David Cameron, to provide smooth sailing through any storms ahead. If we want to retain our spending power, steer clear of inequality, access healthcare and enjoy an enviable lifestyle throughout the course of our retirement, we will need to put plans in place to support our aspirations.
Sorry, there’s just no way to sugar coat this message. If you take your retirement dreams for granted in the same way many of our parents did, reality could easily bite.
How long do you think you’re going to live?
Life expectancy is rising and although this is obviously good news, it comes with some provisos. Firstly, most of us will have to work hard to ensure we have sufficient capital to be able to enjoy our ‘sunset years’ (the notion of “taking control”). No matter how much you embrace ‘wellness’ and take advantage of medical and technological advances, if you don’t have the financial security to make these things count, there is always the possibility that old age could be an uncomfortable postscript to the rest of your life.
If this sounds a little gloomy, it’s important to remember that it needn’t be. The sooner you start planning for retirement, the more room there will be to reach your goals. In reality, this means giving your money longer to experience the benefits of compound gains – interest on your interest – and in turn, this will mean greater possibility of having a rich and fulfilling retirement.
Retirement planning for the retired
But what if you haven’t saved from the day of your first pay check? What if you are already in your Portugal expat home and are only now feeling the pinch?
It’s never too late to start saving or, at the very least, seeking ways to help your money work more positively for you. The first step could be in seeking a financial review of your wealth, assets and pension pot. By establishing what you’ve got now, a professional financial adviser could help you understand what you could have in the future and how you might best achieve that. This could be combined with a look at the tax efficiency of your wealth and whether your pension is in the best place.
Retirement planning may sound like a boring project, but there is nothing boring about ensuring you have the freedom and the financial clout to stand alone, on your own terms, looking forward to a bright, sunny future. It’s the best view of Portugal, in fact, and with a little foresight you may even be able to say to yourself that you’ve never had it so good.
ADVICE FROM BLACKTOWER
The Blacktower Group was formed in 1986 and has earned its reputation providing wealth and management and pensions planning advice to clients in the UK as well as those who are resident abroad. Our proven and bespoke service can help you accomplish your financial goals.
By Manuela Robinson
Manuela Robinson is the Joint-Country Manager of Blacktower in Portugal. With offices in Quinta do Lago, Cascais and representation in Madeira.
firstname.lastname@example.org | 289 355 685
Blacktower Financial Management (International) Limited is licensed by the Gibraltar Financial Services Commission. Licence 00805B. Blacktower Financial Management Limited is authorised and regulated in the UK by the Financial Conduct Authority.