Diary of a self-funded retiree: Entry 5

Welcome to the fifth update in my retirement journey diary. In previous entries, I've shared details about how we've simplified our financial lives, our investment strategy, our retirement budget and our plans for downsizing and supporting our kids.  

Diary entry 5: How we plan to stay healthy and keep our minds active in retirement 

An industry friend of mine divides retirement into four parts: health, relationships, purpose and finance. In this diary entry, I want to focus on the first three. 

Let's start by looking at the issues that arise when you step back from working life and your relationships change. 

"When you retire you go from Who's Who to Who's That?" - Walter Wriston, former Citibank Chair 

One question you may want to ask yourself is whether calling yourself a retiree is a good description of what you are.  

What do you say when someone asks what you do - or, more commonly in my age group - "Are you still working?" Saying nothing leaves an awkward gap in the conversation. 

In my journey to part-time work, I usually say I'm taking a step back, partly because I love talking about the business of InvestSMART and the people we help with our products and services. Maybe also because I am still a bit terrified of being a "retiree".  

One of my biggest concerns about retirement is what to do with all the extra time. TV ads show retirees swimming and dancing with friends, but is it really that easy and relaxed? 

Keeping active in retirement 

There are plenty of things to choose from when you have more time. I have friends who've gone back to university - one from finance who is doing a history degree. Apart from being the oldest in the class, he loved it.  

I think a lot depends on your attitude. My wife and I have a positive view on life, but will help each other if we notice one of us is feeling a bit down. We've always kept our bodies in reasonably good shape, partly because my wife has type 1 diabetes and exercise and diet has been very important in lowering the risks of complications.  

Having a regular fitness routine - whether socially or at the gym - can add structure to your week. Playing a game such as tennis, golf or pickleball has the double benefit of health and social connection.  

Online research (and ChatGPT) suggests activities that work the brain and body are highly recommended - learning to dance, joining a choir or taking up a group hobby. My 99‑year‑old neighbour, for example, walks to church twice a week and helps with the flower arrangements. It keeps her moving and socially connected. 

Mental purpose 

Keeping your brain active is just as important but often harder. I like playing bridge, mainly for its social side, and I've also offered to help run the golf club. Maybe that's my way of staying a "who's who" rather than slipping quietly into "who's that". 

My wife has always been involved in charity work, contributing time and money to causes she believes in. We've talked about doing this together in the future, partly because it is important to have something in common with your spouse, apart from children and grandchildren. Getting involved in local politics is also on the cards, though perhaps only when issues important to us arise.  

Participating in activities can help build new relationships - through the people you meet in shared pursuits, like playing bridge or helping at a care home - and deepen existing ones through common interests, like golf or swimming. 

My top tips  

• The job of retirement takes a bit of planning, so make sure you have some ideas before you apply. It is something you have to work at.  

• Retirement really is something to look forward to, just make sure you are ready.  

• Finding a "purpose" depends on what you want - helping with the grandchildren is a joy but is that enough?  

• Think about giving back to your community. It will make a difference to your life.  

• And stay healthy for as long as you can. It's the quality of life that matters, not the quantity.  

Update on my portfolio  

In my second diary entry, I discussed my portfolio allocation and, given that was about 3 months ago, I thought I'd share an update. We had Trump's "liberation day" almost immediately after I moved about 8% from cash and fixed interest into global and domestic equities. I put a little more in when markets fell by about 10%. Were we worried we had made a mistake? Of course, but having stayed invested and not panicked, we are back above where we started. We have this pinned to the wall behind the computer: "Time in the market always beats timing the market." Our current allocations are shown below. The "other" includes a gold and a silver ETF (now available on InvestSMART through Custom). 

• Global equity: 40%    

• Cash: 18%    

• Defensive: 21%    

• Domestic equity: 18%    

• Other: 4%   

 What's next?  

I'll cover how we manage the compliance parts of our SMSF and what I've done to reduce its costs.