Retirement has changed quite a bit in the last few decades — instead of retiring at 65 with a life expectancy of about 10 more years, most are finding themselves retiring either much earlier or much later than 65 with a life expectancy of at least 85 (occasionally even longer, in some instances). This complicates everything from longevity risk (also known as the depletion of assets before the end of life) to fewer retirement benefits to added healthcare costs and all sorts of other factors in between. Thankfully, there are ways to make sure that the stress of a transforming retirement field doesn’t get too overwhelming for modern retirees.

Make Your Retirement Plan

First and foremost, you are going to need an effective and thorough retirement plan. Still, a fairly new retirement concept, creating an income plan for your retirement fund is basically like budgeting. There simply wasn’t a need for this sort of planning before the late 2000s — up until that point, the belief was that retirees would be set for life if they invested and sold shares each month to use for their income. This just won’t do for today. Unless you have millions saved, a retirement income plan is an essential thing to have so that you can space out your money over time and not run out.

Evaluate Your Stocks          

In the past, future retirees could bank on stocks and bonds to get them through retirement with ease. Today, with the current market constantly fluctuating and future profits made on stocks and bonds expected to be significantly lower compared to decades past, the same sorts of investments that secured a comfy retirement for former generations can no longer be your safety net. Diversifying income sources by looking into alternative investments and side jobs is the new move — this kind of investment is called cash flow investing and it will be the future of retirement income plans.

Don’t Rely on Your Pensions

As with stocks, it’s not reasonable to expect to live off of pensions alone anymore. While still considered a guaranteed source of income, defined benefit pension plans from employers are on their way to being a thing of the past. They’ve seen massive cuts in recent years and are facing billions in potential underfunding, which means that retirees should consult with their financial planner to figure out backup plans into their retirement plan in case their pension ends up coming in as less than what was expected.

Increase Your Income

To maximize your retirement spending, you must first make sure you maximize your income. Thankfully, there are quite a few ways to do this: Work for at least 35 years and make sure you are always pursuing opportunities to increase your income while you’re working by pursuing side jobs. Don’t retire before you reach your full retirement age and deny retiring until at least age 70. This will ensure the most retirement income possible for you.

Back-Up Your Healthcare

Health costs aren’t getting any cheaper, which means that future retirees need to make sure they plan for the inevitable medical bills as they form their retirement plans. This may be surprising to some, but not everything is covered by the NHS. The last thing you want is to be caught up in a medical emergency that completely throws off your carefully-planned retirement budget. Things like dental care, cosmetic surgeries, eye exams, hearing aids are not always going to be covered and may have to come out of pocket. You need to set aside emergency funding just in case something unexpected arises. 

Check Your Life Insurance

In a similar vein to the precautions you need to take with your healthcare, it’s vital for you to check over your life insurance plan to ensure you’re covered in case of the worst. Likewise, it’s a good idea to check and see if your life insurance policy has accrued any monetary value that you can withdraw and use as a form of retirement income. Plus, as long as you withdraw less than your premiums, the money isn’t taxed. Only a fraction of U.K. citizens have a life insurance plan, so if you don’t have one, you should get one. 

Check Your Pensions

The main problem with pensions today is the same issue that many have faced with their stocks and bonds: the course the market has taken (and the course it’s expected to continue following down in decades to come) has transformed the concept of a pension plan from a dependable source of income in retirement to nothing more than a glorified rainy day fund. Because of this, it’s highly recommended that future retirees pay more attention to their personal savings and other cash flow investments instead. Meet with a financial advisor to determine if you need to supplement your pension plan.  

Check Your Individual Savings Account

The big difference between a pension and an Individual Savings Account (or ISA) is that the former is opened by the employer while the latter is opened by the individual. Like a pension, though, there are certain rules that restrict your contributions and keep you from enjoying the full benefits of your ISA. Consult with your financial advisor to make sure that you aren’t potentially going to be locked out of the benefits you thought you were guaranteed.

Look Into All Types of ISAs

There are five main types of ISAs: cash ISAs, Help to Buy ISAs, innovative finance ISAs, stocks & shares ISAs, and Lifetime ISAs. All can be beneficial, but not all will be one-size-fits-all. Some are for first-time buyers, some are more suited for more seasoned purchasers, and some are brand new and may be better for you than the one you currently have. Do your research and meet with a financial advisor to make sure that the ISA you’re set up with is the right one for you and suits your particular lifestyle. 

Reduce Your Living Costs 

Buying your home early and reducing your cost of living well before you hit retirement age are two of the smartest things you can do to help make your retirement go much more smoothly. Not having to cover payments for your home and learning to live well within your means will ensure maximum comfortability once you’re out of the workforce and into the life of luxury. This will leave much more money for travelling around the world, relaxing at home, and simply enjoying your retirement to the fullest, stress-free.