Picture: ISTOCK
Picture: ISTOCK

Historically, 65 has attained that almost mythical status of being the age at which people retire from the workplace and fade into the realm of retirement to live out the rest of their days in glorious leisure and contemplation.

This might have been the case from the 1950s to '70s, when retired people were subject to the ruling mortality of the age and generally dead within 10 to 15 years of retirement.

A great deal has changed around the world, and probably more so in South Africa. The spectre of inflation and retrenchment had yet to become the challenge it is today.

Why is the idea of retirement not so utopian as it was?

1. Mortality. People in their 60s are likely to have a good 20 to 25 years of active lifestyle ahead of them.

They are, by far, more mentally alert and able to continue working than their forefathers.

2. Financial security. Even in the developed world, where the state assumes a reasonable level of financial support, people are approaching this mythical retirement age without the necessary financial security to opt out of earning an income. This is more acute in South Africa where what little the government is able to pay is only available to people who are virtually destitute. Even then the income is barely going to keep the individual above the poverty datum line.

3. South Africa presides over dynamics not necessarily present in developed countries. More companies are required to look beyond the traditional white employee towards a more equality-based employment philosophy. Employees approaching the 65 retirement age might find that it won't be possible to be retained by their employer even on a contractual basis.

4. In times of economic uncertainty, companies are unlikely to hire new employees, let alone retain those who reach retirement age. They might even adopt a more radical approach and decline to renew any contracted staff, as well as offer the older staff early retirement.

Where does this leave you and me, working in a corporate environment and approaching the stipulated retirement age?

There are a number of options that have to be considered before the inevitable date arrives and you are unceremoniously launched into "retirement".

1. Start to prepare yourself mentally at least a year before your official retirement age. Understand that your company might not have a place for you beyond that point.

This will dampen the psychological aspect of working one day but not working the next - something that has catastrophic consequences for some people.

2. If you are in a professional occupation, your options will be far more varied and secure. Consider setting up a small consultancy and attracting a select group of clients.

3. If you are not in a professional occupation, consider whether your interests or hobbies could be turned into an income-producing business. If you are a keen gardener, why not turn your hand to landscaping once you have attended an appropriate course?

4. Network your colleagues and friends and tell them about your impending retirement - you will be surprised at some of the opportunities this can generate.

In my discussions with younger people, I always warn them that retirement, like death, will arrive at some time in the future and that planning for both eventualities will go a long way towards making the transition from full-time employment to "part-time retirement" easier from a financial and psychological point of view.

Have a discussion with a competent financial planner and share some of your hopes and fears around retirement - they are well qualified to advise you on the future from a financial and lifestyle point of view.

Crossley is a happy 64-year-old business manager at BDO Wealth Advisers who holds the CFP® accreditation

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