Five Challenges You Need To Consider Before You Retire

Whether retirement is more than a decade away or just around the corner, you may face significant challenges that will impact your desired lifestyle. Learning more about these potential stumbling blocks and taking steps to mitigate their impact now could make the transition to retirement go more smoothly.


According to an interactive investor survey, 45% of people who have yet to retire see this stage of their lives as a time for financial freedom. Retirement can give you the freedom to pursue your interests without work obligations. Financial freedom can provide peace of mind, allowing you to live your desired lifestyle.

When asked how they plan to spend their retirement, travel came out on top. When they retired, 3 in 10 (29%) of respondents said that traveling more was their top priority. Using retirement to devote time to developing a new business or hobby was also popular, and this excites 42% of those who have yet to retire.

While you may be looking forward to the day you don’t have to go to work, achieving your retirement goals requires careful planning. There are challenges that those nearing retirement may face, and they may derail your plans. Here are five challenges that modern retirees must consider to create a secure future.


Employees are no longer expected to stay with the same company for decades. Today, it is far more common to switch jobs frequently to learn new skills and seize opportunities. The disadvantage is that you may end up with multiple pensions. This can make determining if you’re on track difficult, and when you consider their various charges and investment performance, you may be missing out.

According to the survey, 66% of people who have yet to retire have more than one pension, and 15% have four or more. Worryingly, 6% are unaware of how many pensions they have. It is critical to keep track of where your retirement savings are because it is all too easy to “lose” them. 

Consolidating your pension can make retirement planning easier in some cases. The difficulty of managing multiple pensions is expected to grow. Because of auto-enrolment, most employees can now access a workplace pension. As a result, it is easy to accumulate a variety of pots throughout your working life.


The process of accessing your pension has become more complicated. Previous generations would typically have a final salary pension or buy an annuity to provide a consistent income for the rest of their lives.

While changes provide more flexibility, they also impose more responsibility on retirees, who must weigh the benefits and drawbacks of each option.

Despite the complexities, only 27% of retired people surveyed used a financial planner. Those deciding how to access their pension were far more likely to conduct their research (64%) or read financial press articles (42%). While these steps can be beneficial, they can cause you to overlook important information and make it difficult to understand how the options relate to your situation.


How long should your retirement savings last? Retirement can last decades, making it difficult to plan your finances to provide the required income. This is why 41% of workers are concerned about running out of money. Almost one-quarter (27%) of retirees are worried that they will not have enough money to last their lifetime.

Even if you choose a flexible income, a financial plan can give you peace of mind about your long-term finances.


If you choose to draw on your pension, your savings will usually remain invested, and this means that your pension will continue to be vulnerable to market volatility. You may also have non-pension investments that you intend to use in retirement.

Following the sharp market decline at the start of the Covid-19 pandemic, nearly half of both workers and retirees rank market declines as one of their top three financial concerns. Market declines can reduce the value of your assets, but keep in mind that markets have historically recovered in the long run.

When you retire, having a cash buffer can help mitigate the impact of market volatility. You won’t have to withdraw from your pension if you have several months’ expenses in an accessible account. When investment values fall, you must sell more units to maintain the same income level. Cash on hand can help you preserve your pension in the long run.


Inflation has been a hot topic recently, so it’s unsurprising that 42% of those who haven’t retired yet rank it as one of their top concerns.

When developing a retirement strategy, remember inflation and how it may affect your spending power. Inflation can have a significant impact on retirement that could last decades. When putting together your retirement plan, there are several ways to account for inflation. This could include leaving a portion of your pension invested in delivering returns that keep up with or exceed inflation. You could also buy an inflation-linked annuity to maintain your purchasing power.

Effective retirement planning can assist you in identifying challenges and developing a strategy to overcome them while focusing on what is truly important to you in retirement.