Hassan Nakabaale, the director of corporate and public affairs at the Uganda Retirement Benefits Regulatory Authority, says at retirement many retirees think of relocating hoping to get peace of mind. But settling in a new area comes with new challenges.
Not knowing any of your neighbours, makes it hard for people to come to your rescue. Settling in a new place also means losing old friends, people that know your character and behaviour.
“Relocating becomes hard because even when you want to buy some items on credit, no one is willing to give them to you, because they do not know you,” Nakabaale says.
Trying to maintain high standards
Nakabaale says today people drive expensive cars, a trend many want to maintain even in retirement. They forget that they are using money that is meant to pay their bills to buy unnecessary things.
“I am not against anyone buying a car, but try to live within your new standards of living. This will help you live the life of the private civil people. You can decide to ride a bicycle, a motorcycle or buy a small car.”
Wanting to please people
He emphasises that simply because you have been heading a big office earning a six-figure salary, you were fond of contributing big amounts of money at every wedding meeting or other events.
Now that you are retired, giving financial support to your community and family members, you ought to reduce on such expenditures. Do not give a wrong impression for the sake of keeping up appearances because some people might take you for a financial refuge.
Nakabaale says instead of draining your wallet, “Let someone know you are no longer in a position to reach out to them. Tell them the truth and those that have always come to you will appreciate your effort and support you where they can.”
Failing to manage your family
Muhammad Mugambe, a retired auditor, says the worst mistake pensioners make is to think of remarrying.
“A person looking forward to retirement or one that has retired should not think of starting a new family. If you are of age and you look for a young girl to be your second wife, that means you are setting up a new expenditure route such as paying schools fees,” he says.
He notes that it is better for one in retirement to stick to their old wives and plan well with them. Why make 60 and you are still paying school fees for a Primary Four child? Looking after that young family means spending all your retirement package.
Many people, especially those that occupied top positions, for instance, chief executive officers, want to isolate themselves from the rest of the community.
You feel so important and do not want to meet the ‘common’ people, you decline attending community meetings. What you have to do is to make these people your friends and learn how to relate with each one of them.
Retiring into politics
To Nakabaale a person that has retired from active service should think twice before deciding to take part in politics. He says weigh yourself and find out if you have got enough resources and other income outlets.
Other than that retiring into politics will lead you into loans and if you want to use your retirement money to join politics, this will cause you more stress.
Building a dream house
“If for the last 60 years you were not able to build your dream house, thinking of a dream house is a waste of time and resources. Instead, construct a simple house to spend the rest of your remaining days in retirement.
“Having Shs200m as your retirement package and buying land in Ntinda that is worth Shs80m does not make sense.Find a piece of land worth Shs15m and construct a modest house,” Nakabaale advises.
Venturing into a new business
Fred Muhumuza, an economist, says after retirement venturing into new investments, especially those you have no idea of is not advisable.
“Why would you import cars simply because you received Shs500m from NSSF yet you have never imported any cars. And now that you are 60 years, you want to venture in that,” Muhumuza wonders.
“ You have never travelled, you do not know how to clear taxes, but someone in Japan is asking you to send money via Western Union so that they send you cars,” he adds.
He encourages people to invest money in businesses they know or inject more in projects they are familiar with.
“That way you will be able to account for the money you are spending and how much you can get as profits.”
Bottom line, retirement planning is a multistep process that evolves over time. To have a comfortable, secure and fun retirement, you need to build the financial cushion that will fund it. The fun part is to pay attention to the serious and perhaps boring part: planning how you will get there. You could consult people in the field of a business venture you have always wished to tap into then weigh your options.