Many people think of retirement planning in the same way as a preflight checklist. That is, as a rigid set of specific actions we take at certain points along a timeline. This is a great way to plan for how to get an aeroplane in the air, given that the rules of physics aren’t likely to change as we’re going down the runway.
When it comes to retirement planning however, this may not be as useful. The ‘rules’ can and do change a number of times in the 10 years leading up to retirement. Our personal situation can change, our goals can change, and even if these stay the same it’s likely that there will be changes to our tax legislation and other things outside of our control.In my mind, having a plan for how to achieve your retirement goals is more like having a game plan. A football team should go out every week with a clear picture of what they are trying to achieve. The game may end up being completely different to what was expected, and some tactics would go out the window immediately, and some would change only slightly. But having a plan to start with allows all team members to be on the same page and gives some structure to the actions they take minute by minute, and the decisions they make as things change.When making decisions with incomplete information, all we can do is make the most of the information we do have. As such, we will always look at what our clients can do with rules as they stand at the moment, while being as flexible as possible with our strategy and being ready and able to adapt to any changes. Starting with a plan we know will change will always be more effective than not having a plan at all, and not even getting started.Written by Dallas Davison.
