As I mentioned in my first blog in this series, financial planning is about ensuring that when you have one foot in the grave and look back over your life, you have no regrets.
Because by then, it will be too late to do anything about it, and you will be mourning lost opportunities.
A bucket list is an essential – and hopefully fun – way of making the most of your life. After all, as far as we know we are only on the planet once!
Make a list of all the things you want to do or experience in your life and get an estimate of the cost. Crucially, give yourself timescales – or you may never get around to achieving them.
These can be built into cashflow projections, and then your wealth can be structured to fund this list as and when you want to tick each item off.
A bucket list does not have to be about frivolous or expensive things (we find that seeing the Northern Lights and campervans are the most popular) but could include paying for children’s weddings or house deposits.
Research has shown that buying experiences are generally more rewarding than buying things. Build up the memories for later retirement.
The following example shows why a bucket list before retirement is essential.
Suppose in retirement that at the top of your list is a very expensive world cruise. Cashflow projections may show that if you retire one year earlier, you will not be able to afford that holiday of a lifetime. But if you work for an extra year, it will be affordable.
If you retire before making your list and then decide (and cost) what you want to do, that ambition may be unaffordable. You may regret retiring, and it may be too late to return to work.
Knowing that you need to work that extra year will enable you to make an informed decision: is it your priority to retire early or go on the cruise?
If you decide to work that extra year, at least you know why you are continuing and you will be working for a purpose. That extra year may therefore be less stressful.
Bucket lists are an essential element in financial planning. Don’t look back and have regrets.
Have you got a bucket list? Can you afford to live your dreams? Assess your state of financial planning at My Financial Planning Scorecard