Retirement is your clients’ opportunity to relax and enjoy the benefits of a lifetime of hard work. After building their savings throughout their career, they can now stop working and dedicate time to their family, engage in new hobbies, or travel the world.

Everybody has their own unique goals, but most people share a desire to be happy and content during their later years. However, many older people face challenges when it comes to their mental health.

A survey published by AgeUK in March 2024 found those aged 50-59 reported difficulties with their mental wellbeing, with 42% saying they felt more anxious than they did a year ago. This is a higher percentage than other age groups polled. Additionally, 46% reported not sleeping well and 41% were less motivated to do things they enjoy than they had been 12 months previously.

The report identified several reasons for these mental health issues including a deterioration of physical health, and social isolation. Many of those surveyed also cited financial concerns as a reason for their poor mental wellbeing.

Unfortunately, these issues may continue into retirement and beyond as the Centre for Mental Health reports that 75% of people aged 65 and above have experienced significant anxiety and low mood at least once since their 65th birthday. Additionally, depression affects 40% of care home residents.

While there are many contributing factors to consider, new research shows that good financial planning could help your clients boost their wellbeing in retirement.

Read on to learn more.

Retirees with a monthly income of at least £1,700 are most likely to be happy in their later years

A new study from Legal & General, in conjunction with the Happiness Research Institute, aimed to explore the link between financial stability and wellbeing in retirement.

According to Professional Adviser, the results demonstrated that UK retirees with a monthly income of £1,700 were most likely to be happy in retirement. To achieve this, your clients would need a savings pot of around £221,858 at retirement, assuming they receive the full new State Pension.

Interestingly, the increase in happiness begins to level off when monthly income surpasses £2,000. This could suggest an adequate income that allows clients to achieve their desired lifestyle is enough to make them happy. Building wealth beyond this level may not be necessary to be content in later life.

With our support, clients can generate a level of income that statistically improves their chances of being happy in retirement.

Financial security could encourage improved wellbeing in all areas of life

The study also explored how financial stability in retirement, and the happiness that it brings, have a knock-on effect on other areas of life. The findings were incredibly promising.

The happiest retirees were more likely to be satisfied in other areas of their life. For example:

• 80% were satisfied with their day-to-day routine, compared with 28% of other respondents
• 70% were satisfied with relationships with family and friends, compared with 36% of other respondents
• 74% were satisfied with their social lives, compared with 23% of other respondents.

The reason for this is likely because improved financial stability creates more opportunities for retirees to live the life they want to in retirement. For instance, your clients can’t travel the world or engage in social activities with friends and family without adequate income.

Indeed, the research revealed that 34% of retirees find that financial constraints hinder their ability to socialise, and potentially contribute to loneliness.

Additionally, your clients may not be able to achieve other goals, such as financially supporting their loved ones, if they don’t have enough in their retirement pot.

41% of retirees who took financial advice were more likely to report above-average life satisfaction

As the research shows, a healthy retirement pot could allow your clients to generate the income they need to live a happy life and achieve the goals that are important to them.

We can help your clients review their savings and make projections about the size of their retirement pot in later life, based on their current pension contributions. We can also assess their other savings and investments. If they’re likely to face a shortfall in later life, we can help them explore ways to increase their retirement savings now.

Conversely, they may be on track to far surpass the amount they need to achieve their desired retirement lifestyle. In this case, they might be able to use surplus wealth to work towards other goals, such as supporting family members.

Ultimately, our guidance could help improve your clients’ overall wellbeing in later life. In fact, research demonstrates that 41% of respondents who took financial advice were more likely to report above-average life satisfaction.

Get in touch

If your clients are concerned about their wellbeing in later life, we can support them.

They can contact us at hello@ardentuk.com or call or WhatsApp us on 01904 655 330. As an award-winning financial advice company with advisers included in the 2024 VouchedFor Top Rated guide, you can be sure that we’re a bona fide company providing excellent advice and high-quality service.

Please note

This article is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.

Your pension income could also be affected by the interest rates at the time you take your benefits. The tax implications of pension withdrawals will be based on your individual circumstances, tax legislation, and regulation, which are subject to change in the future.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.