The Final Countdown: Why the Last 10 Years Before Retirement Are Crucial

HardiSwartCFP®
Jul 17
4 min read

Most people think that retirement planning is about what you do at 65. In truth, it’s what you do in the decade before that determines whether you’ll retire with confidence or confusion.

In over 15 years of working with high-income South Africans approaching retirement, one thing has become clear: the last 10 years before you retire are everything. It’s the period where momentum builds, decisions matter most, and the consequences of delay can be significant.

Let’s unpack why this final stretch is so critical - and what steps you can take now to make the most of it.

1. Your Highest-Earning Years = Highest Savings Potential

Your 50s and early 60s are typically your peak income years. Children are often financially independent, debt is reducing, and earnings are at their highest. This is your chance to supercharge retirement savings - and it’s a chance you don’t want to miss.

What to do now:

Max out contributions to your retirement annuity or pension - up to 27.5% of taxable income (capped at R350,000 annually).
Use your Tax-Free Savings Account (TFSA) allowance - up to R36,000 per year.
Channel bonuses, rental income, or windfalls into retirement vehicles where they benefit from tax-free growth.

2. You Can Still Fix Past Mistakes

Maybe you didn’t save enough in your 30s or made poor investment choices in your 40s. That’s okay. The final decade before retirement is often the last realistic window to correct course.

This is the time to:

Consolidate fragmented portfolios across multiple platforms.
Exit poor-performing or overly aggressive investments.
Restructure for tax and liquidity - and simplify.

3. Strategic Tax Planning Can Save You Millions

Tax planning isn’t something you start after you retire. By then, many tax levers have already disappeared.

Pre-retirement tax planning can include:

Leveraging disallowed contributions to your RA for future tax-free withdrawals under Section 10C.
Using endowments to reduce tax drag in high-income years.
Planning your drawdown sequence across RAs, living annuities, discretionary funds, and offshore structures to limit marginal tax exposure.

4. You Begin Shifting from Growth to Income

This is not the time to “go conservative,” but rather the time to get strategic. The investments that got you to retirement may not be the same ones that get you through retirement.

You should:

Begin allocating to income-producing assets.
Consider a bucket strategy (Go-Go, Slow-Go, No-Go phases) to match your spending with liquidity needs.
Reduce excessive exposure to volatile assets close to retirement.

5. Retirement Becomes Real - And Personal

At 55, “retirement” shifts from theory to reality. You can visualise it - the holidays, the hobbies, the home renovations, the family time. But visualisation without a roadmap can lead to costly surprises.

Now is the time to ask:

What do I want my retirement to actually look like?
What will it cost - monthly, annually, and in future terms?
Am I planning for 20 years… or 30?

6. Estate Planning Becomes Urgent - Not Optional

In your 50s and 60s, your estate typically grows in complexity - trusts, offshore assets, intergenerational planning, dependents, multiple income streams.

A failure to act can result in:

Costly tax inefficiencies.
Delayed distributions and family conflict.
Offshore assets being frozen due to missing cross-border documentation.

7. Health and Medical Planning Needs to Be Baked In

South Africa’s public healthcare system continues to deteriorate - and medical inflation often sits at 10–12% annually. Retirees are spending a larger and larger portion of their income on medical aid and out-of-pocket expenses, especially in later years.

Prepare by:

Reviewing your gap cover and medical aid.
Setting aside a healthcare reserve fund.
Considering long-term frail care and assisted living needs.

8. Stress-Test Your Plan While You Still Can

This is when you ask: What if…?

What if markets crash in your first year of retirement?
What if your spouse passes away first?
What if you live to 95?
What if inflation spikes?

It’s better to test your plan now - while you still have options - than scramble later when you don’t.

9. Define Your Purpose - Not Just Your Portfolio

Money is a tool, not a destination. The happiest and most fulfilled retirees we’ve worked with knew why they were retiring - not just when.

Ask yourself:

How will I spend my time meaningfully?
What role will I play in my family or community?
What legacy do I want to leave?

10. Work With the Right Team

This is not the time to wing it or rely on dinner-party advice. You need a trusted team - financial planner, tax advisor, estate specialist, and possibly a fiduciary.

At Family Wealth Custodians, we guide clients through this final countdown - from strategy to implementation, with a plan that adapts through retirement, not just to it.

Final Word: Your 10-Year Countdown Action Plan