“How much money do I need?” is one of the top questions I so often get asked by my clients. Whether it’s from a female saving towards retirement or someone who’s going through divorce, clients are looking to get a definite number so that they can see how near or how far they are from this number.
Having a specific number helps us in our planning. If it’s a female going through divorce, this can be her yardstick to measure her actual settlement against. If it’s someone close to retirement age it allows them to see whether they’re on track. If it’s someone saving towards retirement it gives them a figure to aim for.
But of course, it’s not that straightforward.
If you’re a female aged 65 and looking to stop work in the near future, you will need a different amount saved to someone who’s 55 and looking to stop work- assuming you’re both likely to live to the same age. The younger woman will be drawing against her pot for 10 years longer and therefore needs a bigger pot to start with.
If you’re aged 60 and lead a reasonably lavish lifestyle with a number of overseas holidays, a lot of socialising (oh those were the days..when that was allowed!), you will need a different figure to a woman of the same age who enjoys holidays in the UK at a basic bed and breakfast and has a much more modest lifestyle.
The amount you need is fully dependant on the lifestyle you want to live in the future. The younger you are and the more lavish your ideal lifestyle, the more you will need. So, there isn’t a one size fits all to the question “How much do I need?”.
As ever, the answer is “it depends”. It depends on your age, your lifestyle, your priorities, your values, whether you want to leave a legacy on your death or whether you plan to spend it all, and many other things besides.
But interestingly, events over the past few months have encouraged all of us to rethink our desires and what it is we want in our ideal lifestyle.
A lot of women I’m speaking to are rethinking their working life. Professional women are considering maybe they don’t want to go back to the working life they were leading pre lockdown. For them taking time out to enjoy life and reduce their earnings now has become more attractive than working flat out for several more years.
Non-working women have been looking at their spending over the last few months compared to earlier periods and realised the big difference. If spending reduces, they need a smaller figure to fund this lifestyle.
Does this sound like you? Would you love to get an answer to the question “How much money do I need?”
I have developed a Wealth Compass Review service to help you understand the options available to you and understand the lifestyle you can afford based on your new circumstances.
If you’d like to find out about this service please do contact me at [email protected]
We can have a no obligation phone call to discuss whether the service is appropriate for you and whether we would be a good fit to work together.
I look forward to speaking with you.