Changing of the guard

Dominic Thomas
Dec 2022  •  5 min read

Changing of the guard

I know that football isn’t everyone’s cup of tea, but it often provides useful metaphors. Whether you love or loathe it, I suspect that you have heard the name Cristiano Ronaldo, who is one of the sport’s true superstars, with a career that has made him extraordinarily wealthy as his prolific goalscoring has resulted in team successes and trophies. At the age of 37 he is representing Portugal at his fifth World Cup (starting in 2006). His latest contract pays him £26m a year.

Yet on Tuesday evening, he was left ‘on the bench’ and watched as his team beat the Swiss 6-1 with a hat-trick from his replacement, Ramos some 20 years his junior. Few of us will contemplate retirement at 37, but in sporting terms, that is ‘getting on a bit’. Ronaldo and his many millions of admirers will have mixed feelings about seeing someone else take centre stage and provide an extremely good performance that threatens the possibility of Ronaldo’s normally guaranteed place in the starting line-up for the next match against Morocco on Saturday for a place in the semi-final. Those who know football, will observe that this is a normal experience for all players but rare for the superstars of the sport, but something that Ronaldo has only recently begun to experience at his club (or no longer his club).

PLAN, PURPOSE, PREPARATION

There is no obvious way to prepare for retirement, for some it is a very sudden change of pace and evokes questions about purpose and meaning, for others there is a sense of relief, as though a great burden has been lifted. A recent webinar presented by researchers from academia, has found that most retirees are not very well prepared for the transition. Whilst finance and having enough money is a significant element of retirement, it certainly isn’t the sole consideration.

Researchers found that most people do not consider how a change in health may create problems where they live, if they are unable to drive, use public transport or have a hospital reasonably nearby. They also pointed to the underappreciation of social contact and community and how a once pleasant ‘get away from it all’ location becomes increasingly isolated from valuable personal connection.

One question that seems to be understood and answered differently in different countries is “when does middle age end? And when does old age begin?”. This reminded me of a clip that I saw recently in which it was argued ‘middle aged’ is between 35-50, being typically the mid-point in most people’s lives…

65 IS THE NEW 45…

Often, we hear “you are as old as you feel” I’m not convinced by that, but I do think having connections, community involvement, friends and family all help make life invigorated and outward looking. Pop star, material girl, Madonna will turn 65 in August 2023 (next summer) and if she had been a UK resident for long enough, paying her NI, would be eligible for her State Pension in 2024.

As for people who have already turned 65 in 2022 – Stephen Fry, Jo Brand, Nick Faldo, Jayne Torvill, Frank Skinner, Timothy Spall, Daniel Day Lewis, Siouxise Sioux, Fern Britton, Dawn French, Billy Bragg and Steve Davis are all part of the cohort that will collect their State Pension at 66 in 2023. As for Ronaldo, if he was eligible to claim a UK State Pension, under current rules he could do so when he is 68, which is in 2053, some thirty years time during which he would see a further seven World Cup tournaments.

You can read more articles about Pensions, Wealth Management, Retirement, Investments, Financial Planning and Estate Planning on my blog which gets updated every week. If you would like to talk to me about your personal wealth planning and how we can make you stay wealthier for longer then please get in touch by calling 08000 736 273 or email info@solomonsifa.co.uk

Changing of the guard2023-12-01T12:12:40+00:00

Howzat?

Solomons-financial-advisor-wimbledon-bloggerHowzat?

James Anderson recently became England’s most successful bowler as he took his as he took his 384th wicket, that belonging to Denesh Ramdin and overtaking Ian Botham in the process. This is of course an incredible achievement in International cricket – congratulations Mr Anderson. So I was surprised to see an item on the BBC sports website that attempted to work out who really was/is the best bowler England have ever had.

Sport as you will know has become increasingly dominated by statistics – attempts on target, completed passes, distance run, speed of delivery the list is very long and naturally varies from sport to sport. When winning any sport tournament, many rather dull teams/individuals have argued that its not the manner of the victory, just that there was a victory. I cannot help but think of the time Greece won the 2004 European Football championship (sorry Greece)… or for that matter many Champions League finals, where one team essentially set up camp in their own penalty area hoping to counter attack and steal a victory. Wisden

Cricket is not new to adopting statisitical analysis – arguably starting the statistical obsession with John Wisden’s annual almanac started in 1864. So anyone wishing to pour over cricket statistics has had plenty of opportunity to do so. Anyway the BBC asked its pundits to assess England’s top 10 bowlers and ascribe a value to the wicket taken. In short a batsman that averages 50 runs is worth more than one that averages 5. Recompiling the data provides a different twist with Matthew Hoggard topping the list (248 wickets). Whilst this is “all very interesting” sport, like life cannot be metered into a nice, neat formula. There is always a context, which even with a lengthy span of statistical data is flawed. For example – the quality of the opposition is a key ingredient, the prevailing rules, TV replays and so on, let alone the context of the pressure of the moment. Statistics are cold, unrepentent and have no context other than a time period.

Investment returns and the charts that you see plastered on advertising boards or in any media are similarly misleading. Most investors probably know that this is the case, but few behave as if it is. Most investors are tempted to invest once returns are good, most sell when they have been poor, on average chasing returns, receiving below-average market returns at above market cost. Sadly the equivalent best investment “gongs” or awards also measure historic data (there is no other) and the context of this is against peers. Who is the best fund manager? well it rather depends on which sector, what timeframe, what measure of risk is used, and what luck was involved. In short, its an impossible task, yet many play the game and attempt to quantify who is “best”.

In practice, the only investment returns that matter are the ones that you actually get. Cricket, motor racing, football, tennis, golf…are all enjoyable escapes, but again the only best that any sportsman/woman can be is their own best, in the context of their sport, time, team and luck. I have nothing against awards for best this or that, (they can be a lot of fun – especially if you win one or two) but as ever, context is everything. I can only be the best financial planner that I can be, constantly striving to improve and be better than I was last year, last month, last week… and of course our service (like most) is not for everyone, but for those that want and need it… well we try to make it the best possible.

Dominic Thomas

Howzat?2023-12-01T12:40:04+00:00
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