{"id":47895,"date":"2024-12-18T20:57:42","date_gmt":"2024-12-18T07:57:42","guid":{"rendered":"https:\/\/milfordasset.com\/?p=47895"},"modified":"2025-09-18T21:02:30","modified_gmt":"2025-09-18T09:02:30","slug":"how-to-determine-retirement-lifestyle","status":"publish","type":"post","link":"https:\/\/milfordasset.com\/insights\/how-to-determine-retirement-lifestyle","title":{"rendered":"How to determine retirement lifestyle"},"content":{"rendered":"

This article was first published in\u00a0BusinessDesk<\/a><\/p>\n

Managing wealth not just about accumulation, but how to use it.<\/strong><\/p>\n

On the face of it, this married couple \u2013 let\u2019s call them David and Margaret \u2013 seemed headed for a reasonable retirement, with about $900,000 to invest for the future.<\/p>\n

But, as expert Philip Morgan Rees says, good wealth management isn\u2019t just about what you\u2019ve accumulated, it\u2019s also about what you want or need to do with it.<\/p>\n

Morgan Rees, head of Wealth Management and Advice for Milford, says their team regularly helps the likes of David (64) and Margaret (59) prepare for their retirement and to invest their $900,000. But before they recommend options, they gather a lot more information.<\/p>\n

In this case, Margaret had a KiwiSaver account valued at $106,000 and the couple owned a rental property, worth $1.3m, that they planned to sell in around five years to help fund their retirement. Although David\u2019s close to retirement age, he\u2019s not anticipating fully stopping work until he\u2019s about 71. By then, Margaret will also be receiving New Zealand Superannuation.<\/p>\n

After factoring in all potential inflows, plotting long-term cashflows \u2013 including working out regular spending on living expenses and irregular payments such as holidays, updating cars and maintaining the home \u2013 Morgan Rees worked out that David and Margaret would need $65,000 a year to live on.<\/p>\n

Moreover, for the first three or four years after retirement, they wanted to travel extensively, requiring another $30,000 a year. They\u2019d also like to be able to help out their two children if they need financial support.<\/p>\n

With all of those details at hand, Milford were able to suggest investment opportunities that would suit their requirements, he says. \u201cUsing an online tool developed by Milford, called LIFE, we model scenarios showing them the long-term expected returns against their expected cashflows and how that would match their goals.\u201d<\/p>\n

The digital tool also takes into account that a lot of variables can affect what happens to your investments: \u201cMarkets rise and fall and returns don\u2019t travel in a straight line, so you need to look at what could happen to your investments in those different markets,\u201d says Morgan Rees. \u201cThe skill of a good financial adviser is the ability to adjust, especially when it comes to taking money out of investments to spend.\u201d<\/p>\n

For example, if David and Margaret decide in the future that they want to help their children financially, they not only need to have investments that allow them the liquidity to access their money, but they have to consider what the markets may be doing at the time \u2013 as bad timing can have a profound effect on their portfolio.<\/p>\n

\u201cIf you are drawing a sizeable sum after a big drop in the market \u2013 which can happen, we\u2019ve seen three very big drops in the last 25 years \u2013 that\u2019s going to have quite a big impact on your wealth in the long term, whereas if you are taking the same sum when markets are at their peak, the impact is not going to be as big on your overall capital position,\u201d says Morgan Rees.<\/p>\n

\u201cGood wealth management is working alongside clients to understand the impact, and to know the best ways to use your investment capital.\u201d The benefit of all the above steps is that, in the case of David and Margaret, they have a much clearer vision of their financial future \u2013 and what their options are and how they can achieve their goals.<\/p>\n

That, says Morgan Rees, is the fundamental element of wealth management. Receiving good financial advice when it comes to investing hard-earned cash is one factor \u2013 but there\u2019s far more to wealth management services than simply helping people to grow an investment portfolio.<\/p>\n

Financial advisers should be looking at the big picture when it comes to their clients \u2013 including how they want to use accumulated funds, Morgan Rees says: \u201cInvesting is not as straightforward as just growing your money as much as possible. Of course that\u2019s a big part of it, but it\u2019s much broader.<\/p>\n

\u201cFinancial advisers should be looking at all potential inflows and outflows, and getting their clients to answer key questions like, \u2018How much money do I need?\u2019, \u201cWhen am I going to need it?\u2019 and \u2018Have I got enough?\u2019<\/strong><\/em><\/p><\/blockquote>\n

\u201cWhat\u2019s really important at the outset is what the clients want to do with the money,\u201d he says. \u201cWe can then help them to visualise their options and work out a plan.\u201d<\/p>\n

One of the big variables with investing money to provide for the future is that no one knows how long he or she will live. Financial advisers don\u2019t have a crystal ball, but they do have tools to show you your options: \u201cLife expectancy tables are not a definitive answer, but they\u2019re a starting point,\u201d says Morgan Rees. \u201cWith life expectancy increasing, it\u2019s important to keep growing your portfolio, especially when inflation rears its head from time to time, which makes other more predictable alternatives sub-optimal.<\/p>\n

\u201cGood wealth management can help clients to understand their options. When you first retire you are likely to be more active and doing things like travelling. The second phase of retirement is often more centred around being at home and the third stage for some can include the cost of healthcare and support.<\/p>\n

\u201cAs conditions change, you may need to reassess your options and change your approach.<\/p>\n

A good financial adviser will be able to advise you on that, especially when your ability to take on risk may also have changed.\u201d A good financial adviser will not only tell you what they think are the best investment options given all the variables, and make you feel comfortable with your choices: \u201cThey are there to take you from the start of your investment experience on a journey that can include periods of market volatility.<\/p>\n

\u201cLife can throw curveballs but a good financial adviser can adjust to the circumstances and, by following a good process and communicating really well, along with understanding what you want to do with your money, they can help you to have the lifestyle you want.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

This article was first published in\u00a0BusinessDesk Managing wealth not just about accumulation, but how to use it. On the face<\/p>\n","protected":false},"author":52,"featured_media":42946,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"ep_exclude_from_search":false,"footnotes":""},"categories":[850,848,783],"tags":[840],"media_type":[701],"fund_category":[],"class_list":["post-47895","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-retire-well","category-investing","category-private-wealth","tag-masterclass","media_type-read"],"acf":[],"yoast_head":"\nHow to determine retirement lifestyle - Milford<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/milfordasset.com\/insights\/how-to-determine-retirement-lifestyle\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"MAM\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/milfordasset.com\/insights\/how-to-determine-retirement-lifestyle#article\",\"isPartOf\":{\"@id\":\"https:\/\/milfordasset.com\/insights\/how-to-determine-retirement-lifestyle\"},\"author\":{\"name\":\"MAM\",\"@id\":\"https:\/\/milfordasset.com\/#\/schema\/person\/f1d0ca8b4295df91c529dc366431f417\"},\"headline\":\"How to determine retirement lifestyle\",\"datePublished\":\"2024-12-18T07:57:42+00:00\",\"dateModified\":\"2025-09-18T09:02:30+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/milfordasset.com\/insights\/how-to-determine-retirement-lifestyle\"},\"wordCount\":1028,\"publisher\":{\"@id\":\"https:\/\/milfordasset.com\/#organization\"},\"image\":{\"@id\":\"https:\/\/milfordasset.com\/insights\/how-to-determine-retirement-lifestyle#primaryimage\"},\"thumbnailUrl\":\"https:\/\/milfordasset.com\/wp-content\/uploads\/2024\/12\/iStock-1347627626-desk-How-to-determine-retirement-lifestyle.jpg\",\"keywords\":[\"Masterclass\"],\"articleSection\":[\"Retire Well\",\"Investing\",\"Wealth Management\"],\"inLanguage\":\"en-NZ\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/milfordasset.com\/insights\/how-to-determine-retirement-lifestyle\",\"url\":\"https:\/\/milfordasset.com\/insights\/how-to-determine-retirement-lifestyle\",\"name\":\"How to determine retirement lifestyle - 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