On 29 May, British explorer Edmund Hillary made history by reaching the summit of Mount Everest. Of course, Hillary wasn’t alone on that day. Nepali-Indian Sherpa Tenzing Norgay was an experienced Himalayan mountaineer, and his knowledge of the climb – and descent – was key to the party’s success.
While Hillary may have been the explorer whose mission was to reach the summit, he couldn’t have done it without Tenzing. Indeed, Time magazine named both men in their ‘top 100 most influential people of the 20th century’.
What many people don’t realise is that the descent from the summit of a mountain is often more dangerous than the climb. As American mountaineer Ed Viesturs, who has climbed Mount Everest seven times, says: “Getting to the summit is optional; getting down is mandatory.”
The true value of a Sherpa is often seen in the descent. It’s much the same when it comes to your retirement. If you imagine your pension fund as the summit, it can pay to have a Sherpa by your side as you climb towards the day you finish work – we call this the ‘accumulation’ stage.
However, their true value comes once you retire and you start to drain your savings from their peak – the ‘decumulation’ stage.
Why it’s the descent that’s that hard part
According to the British Medical Journal, some 192 of the 212 deaths on Mount Everest between 1921 and 2006 were above base camp. Among the climbers who died after scaling more than 8,000 metres (about 26,000 feet):
- 56% died on their descent
- 17% died after turning back
Just 15% of climbers died on the way up or before leaving their final camp.
- Douglas Fields, chief of nervous system development and plasticity at the US National Institute of Health says that these findings aren’t surprising. “That’s actually a common rule in climbing that more people die coming down than going up,” says Fields. “You’re spent getting to the top. You get tired, you’re exhausted.”
According to mountain climbing expert Stewart Green, most deaths occur while descending the upper slope, after they’ve reached the summit. It’s in the area above 8,000 metres called the ‘Death Zone.’ The high elevation and corresponding lack of oxygen coupled with extreme temperatures, weather, and some dangerous ice falls, create a greater risk of death than on the ascent.
Thankfully, most climbers avoid the dangers thanks to the Sherpas they hire to help carry gear, install ropes, and break tracks.
Let’s now apply this logic to your retirement. Any financial adviser worth their salt can help you to set up a pension or tell you to contribute to your Defined Benefit (Final Salary) scheme. They might also suggest other investment alternatives to help you boost your retirement fund. They may even tell you to pay your National Insurance contributions so that you qualify for the full State Pension.
This is all the ‘ascent’. Of course, it’s sometimes not easy. You may have to work hard, have a solid plan, and stick to your goals. Any bad weather can blow you off track!
However, any mountain guide worth their salt will tell you that the skills needed to reach the summit are quite different to those for getting back down.
Kami Rita Sherpa knows Mount Everest better than anyone else. He’s summited the world’s tallest peak 24 times, more than any person in history. He says that problems arise when people accidentally push past what their body can support.
Some research suggests that climbers can develop ‘summit fever’ which sees them race to the top to prove they can, even when their bodies are showing signs of giving out.
“When returning, their body is out of energy, and many people die due to this cause,” he said.
Getting down requires discipline, planning, and a careful strategy. This is where a retirement Sherpa – your financial planner – comes into their own.
Just like a mountaineer, they will help you understand the risks associated with both legs of the journey – particularly the descent – and do their best to help you avoid them. Reaching the summit of a mountain is an incredible achievement, but it’s just the halfway point.
Why it’s so important to talk to a retirement Sherpa before your descent
Climbing down the mountain used to be easy. You’d finish work on a Friday afternoon, and wake up retired on a Monday morning, probably with an inflation-proofed pension guaranteed for life.
Even if you’d had to save up yourself, you could have taken a lump sum, bought an annuity, and sat back and relaxed knowing your income would roll in every month.
These days, the down slope has all sorts of crevasses and cliffs. For a start, you might not want to start a steep descent straight away Maybe you want to transition into retirement – perhaps working part-time or on a consultancy basis?
Your choices at retirement are also much wider than ever before. Pension Freedoms mean you have a range of options, but with decisions comes complexity. Get it wrong and you risk a sizeable tax bill or, even worse, running out of money in retirement.
Just as the summit of a mountain is the point of maximum risk, so is your retirement.
Taking it slowly with the help of a retirement Sherpa is vital. Indeed, research by Moneyfacts has found that individuals who don’t take advice before drawing down their pension are three times more likely to run out of money compared to those who sought the help of a financial planner.
Get in touch
If you’re approaching your retirement, and you need a professional guide to help you navigate the risky descent ahead, get in touch. Find out how we can be your ‘retirement Sherpa’ – contact us today or call 01372 404417.
A pension is a long-term investment. The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Your pension income could also be affected by the interest rates at the time you take your benefits. The tax implications of pension withdrawals will be based on your individual circumstances, tax legislation and regulation which are subject to change in the future.