I’m supporting a number of clients at the moment who are at the point where they are right on the precipice of making a fundamental change in their lives.

All of these clients, in their own unique ways, are going through the same experience…

They’re trying to work out what it feels like when you’ve got no more ‘paychecks’.

It’s really interesting…

If you’ve been used to being ‘paid’, regardless of whether it’s via your employer or through your own business, the realisation that your regular income is stopping is often one of fear… and I get it.

Even if you’ve built enough wealth to be Ok (and all of my clients have), the fact that the income is stopping, potentially permanently, means that we need to think about our lives through a slightly different lens.

So, in this blog, I want to share the three things I’m talking to my clients about to help them manage this emotion and support them into either retirement or ‘what happens next’ with more comfort and security…

1) Get clear on your financial plan…and model the ‘what if’ scenarios

A lot of the way we help clients, both initially and throughout the years we work with them, is by providing clarity on where they are financially so they can make important decisions at some of these crossroads.

Often, getting clear on what you need to achieve the life you want and the money you need to achieve, will give you the clarity and psychological comfort you need to make the decision to have ‘no more paychecks’.

However there’s one thing I find which also helps when thinking about getting more comfort when it comes to receiving no more paychecks…and that’s “What If” scenario testing.

Often, when we build a client their first financial plan, we’ve used a set of assumptions. However testing these assumptions is really important and can provide an extra level of psychological comfort. If you’re working with a financial planner you can ask them to build these “What If” scenarios into the cashflow plan I hope they’ve built for you. For example you might want to ask your financial planner to ask you questions like…

“What if I spent another £10k on travel every year?”

“What if Markets took a downturn, and what impact would that have on my plan?”

or

“What happens if inflation was higher than we’ve assumed?

The amount of “What if” testing you can do is unlimited, but my experience is that if there are specific concerns one of my clients have we can model this and look at it’s impact. At that point we can make some important decisions.

Of course, if you’re not working with an adviser and you’re a whizz with Excel, you can potentially model these ‘what if’ scenarios too.

However regardless of whether you do this with a financial planner or not, clarity of both your plan and the impact on your plan looking at various What If scenarios is definitely an action worth taking.

2) Look at ALL the options and decide which one really works for you

We often think that ‘retirement’ or ‘what happens next’ is about a permanent stop. However the reality is that most of us have got a number of options we should consider way before we simply go from working full time, to not.

Phased retirement is an option, where we slowly reduce our hours instead of taking a ‘hard stop’. This then allows you to slowly get used to the point where the amount you recieve from payslips reduces gradually.

Continuing to work, but in the time and manner that suits you, might be another option to ensure that the payslips (or income) never stops.

There’s a bunch of other options. The alternative options, and many that my clients have taken on are  non executive directorships or consultancy or self employment. There’s plenty of choices we can make which provide alternatives to moving from full time pay to no more paychecks. You just need to look at, in your unique situation, what options you’ve got and work towards the one that suits you most.

3) Realise that no situation is permanent

I recently had a lovely chat with the guy who helps run my local Padel tennis club.

He told me that he’d recently retired and, being a lover of Padel tennis for twenty years, and with a desire to continue to work, he now combines his hobby with a continued paycheck.

Now I’m not sure whether he had a large or small gap between his retirement and this new Padel center managing era of his life. I’m not even sure whether he’s doing it for the paycheck, or to spend time in an environment he loves, or a combination of the two.

What I am sure of, and I’ve seen time and time again, is that ‘last paycheck’ is actually reversible, and whilst it might not be in the same role, or the same job, or in the same sector, if you wanted to do something else to earn an additional paycheck you could.

Whether you want to do it is a completely different matter, and you may decide that once you’ve settled into not working you’re more comfortable.

The element I want to highlight is that if you’ve always got options. No situation is permanent and understanding this might ease the emotional and psychological impact of that ‘one last paycheck’ as it arrives…

One other important point here…

If you’re feeling stress and tension as your last paycheck approaches, just know, you are not alone. It’s perfectly natural to feel this way and perfectly understandable as you bite the bullet and move onto the next stage of your life, that you’ll feel a bit anxious.

However by getting clear on your financial plan, exploring all of your options with plenty of time to spare, and understanding that whatever you decide nothing is permanent and you’ve got options, should allow you to enter this period with a tiny bit more psychological comfort.

I hope it helps.