Most of us don’t start thinking about retirement in earnest until we realise, reluctantly, that we probably aren’t going to live forever after all.
We aren’t generally too keen on the idea of confronting our own mortality so preparations for those golden years are inevitably pushed down the to-do list.
An early redundancy, health scare or last child moving from the family home can be triggers.
What prompts us to make the decision varies from person to person but most would-be retirees share one thing in common – they have to find a financial adviser to help them negotiate a path to retirement. For many of us, the first appointment with an adviser is booked when we are in our late 50s or early 60s – often older.
Which is why, sitting across from your planner, the first thought through your head won’t be, “gosh I can’t believe I have paid tax all my life and still don’t get the bloody pensioner discount card”. It will more likely be, “what would you know, you’re only a kid”.
Taking life-changing advice from someone younger than your oldest child is a little unnerving but it is a scenario that is becoming increasingly common. The reason is very logical: the financial planning industry is dominated by baby boomers who are starting to retire at the same time as thousands of would-be clients.
Here’s the good news. You might be put off by the unnervingly youthful looks of the adviser you are speaking to but chances are they are better qualified than the generation they are replacing.
Yes, experience counts for a lot. But many older planners cut their teeth when financial planning was largely unregulated and their misdeeds were responsible for the industry’s current bad standing.
Many had no tertiary qualifications. Surely you would want the person in charge of your financial future to have studied finance or accounting? A recent survey by Money Management magazine indicated that 100 per cent of advisers under the age of 25 held either a bachelor’s of master’s degree in finance, economics or accounting, compared with 25 per cent in the over-65 bracket. Younger planners have grown up in an era of significant regulation and are also less wedded to the discredited trailing-fee remuneration system, which, to their credit, many experienced planners are opposed to.
Most importantly, youth means they will be around to see you through your golden years and, when you do go to God (yep, it’s going to happen eventually), they will be able to ensure your estate is handled appropriately.