Post Retirement Risks – Financial Risks, Personal Risks, Housing and Healthcare RisksLast Updated Date: Sep 01, 2023
So, in this article, we will know about all types of Post Retirement Risks.
As a matter of fact, we have prepared 4 significant Post Retirement Risks that we will address in this article. So, buckle up!
Retirement is always a massive occasion no matter where you stay, or which job you are doing. There are several aspects that one must consider while you plan the big day.
Now, you can decide to retire early, or at the usual time, there are several things that can go wrong after you retire from your job.
Financial Risk – Post Retirement Risks
If we are honest, the financial risks are the biggest obstacle after you retire. However, that can be further split down into the followings:
Market Inflation Risks
The price of goods and services in the market are bound to increase with time. Therefore, there will always be an inflation risk which you can face after your retirement.
As the pension you receive will not be the same as the salary you used to get, the ramifications can be massive.
Rate of Interest Risks
If we observe carefully, the rate of interest rate has fallen down significantly. Yes, it took some time for this drop to take place, but the worrying factor is the graph is continually downwards.
So, whatever savings and assets you own in your bank or any financial institution, the interest rate is shrinking, which is putting you at risk.
Considering you have ample knowledge in trading stocks or other forms of investment, you can incur a loss any time.
Now, whatever the reason behind the loss you suffer, it is you whose hard-earned saved money is gone. As is always against you, we will always consider such a situation a potential risk.
Business is always uncertain. So, while you are well-established in whichever mode of trading you are doing, you are always at risk.
There can be several reasons for your business to suffer a loss, but while you are retired, you don’t have the financial backup that you once had.
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Personal & Family related Risk – Post Retirement Risks
Here are some major Post Retirement Risks related to Personal & Family.
When you retire from work, you expect to live to a certain age, depending on your health status.
We can all agree that no one wants to die, most of the retirees live way past the average life expectancy years. So, there is always an element of risk you run out of money one day.
While you are working, you get an opportunity which is way better than the current job you are doing. So, you have decided to quit the job and take early retirement.
However, after a few days on your dream job, you found out things are not like sunshine and rainbows, as you would have thought, exposed you to an uncertainty.
Medical Stress of Family Members
This is a genuine issue, particularly if you are retired. Anyone in the family contract a disease which is severe in nature. You may not be prepared for such a turn of event in your life.
If we keep the emotional aspect aside, you still have to deal with medical expenses, which can burn up your savings in a matter of months, sometimes days.
So, while you are planning to retire, you must contemplate this factor separately.
Separation with Spouse
This is yet another complicated family-oriented risk that you may not be prepared for.
If you decide to get a divorce after you hang up the boots from your job, there can be several financial stresses that you may have to go through.
So, make sure you don’t put yourself into that position or at least, be prepared for it.
Expected Family Urgency
Typically, when you retire, you are, in all fairness, an elderly. So, you usually have a family with grandchildren.
So, in case of any financial emergency, you are the first person your family will look for assistance. Therefore, you may not be prepared for those situations.
Let’s say for argument’s sake you are, but that will always put you at risk to sustain yourself in future.
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Housing and Healthcare Risk – Post Retirement Risks
Here are some of the major Post Retirement Risks related to Housing & Healthcare –
We all would agree that the general cost of living is getting higher exponentially. That also includes medical expenses.
Now, you may prepare for a certain percentage of the inflation rate. If that rate exceeds your calculations, you are in severe risk.
Any medical insurance that you have done will not cover the general medical expenses. So, you should be extra careful about this.
If you own a house, you are saving any rent that you need to pay elsewhere. However, that doesn’t mean you are free from paying a cost.
Maintaining a private home property involves a huge capital investment every year.
So, if you are not aware of the latest pricing structure to renovate your house, we recommend you do so fast or else it would be a massive risk that you have never anticipated.
Hiring Medical Staff
Life is unexpected, and at any given point of time, you may catch a disease that would force you to hire a medical care-giver.
Now, of course, that fee is not going to be small. On the other hand, it is something which is very hard to predict.
So, we hope you will not require to get one nurse for you and avoid any such unforeseen risks.
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Other types of Risk – Post Retirement Risks
Here are some of the common Post Retirement Risks other than Financial, Personal or Healthcare.
Natural disasters like earthquakes, floods, cyclones, are tough to anticipate. So, any damage it causes you is something out of your regular calculation.
On the other hand, it is something where you are being forced to spend from your savings, which in normal circumstances, you never would have to bear.
Even though it is hard for you to prepare, if you are living in a place where such natural calamities frequently strike, you should be prepared to protect yourself from the risk of burning out all your savings.
Even though it doesn’t directly affect you, there are things that have tied-end to you. A recession can cause one of your family members to lose his job.
So, until the time they get another job, you will be the first person they will look for. Now, while you help them, you are technically putting yourself at risks.
Change in Tax Policies
Every time a new government is formed; chances are, they do change the tax policies. Now, you may argue not every change in policies disrupts your payment cycle.
But there are several examples in the past that cause general people to either not get what they deserve or overpay. Either way, it is a risk which you are not prepared for.
Life is full of possibilities, and it can have a disastrous effect on you after your retirement. It is very hard to pinpoint a particular example for the miscellaneous expenses.
Either way, the bottom line is you will not be prepared for those and always be vulnerable.
Conclusion – Post Retirement Risks
This article is not meant to scare you for any unforeseen event after you retire. Instead, this is a warning to you to be prepared for the battle that you are about to begin.
If you are aware of the possibilities, you shall as well take a stand to be prepared to face them eventually, and battle them out.
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