November 26, 2018

Retirement Planning

Have you recently realized how comfortable certain things have become? You can visit a store like Woolworths, the Fruit and Vegetables section and see exactly how fresh a product is by looking at the product only after the “sale by date”. Although most things are based today on this “sale against” principle, life unfortunately does not work the same. You do not know what your “sale by” date is and it complicates your retirement planning.

Retirement planning needs to be addressed fairly early in your life to ensure that you have enough funds available for when you are older. It is a scientific fact that people live longer. A recent article by Amy Bell, “Raising the Retirement Age”, clearly states that British, French and German governments increase the retirement age of their respective populations.

20’s – In your 20’s you must focus on the payment of any outstanding debts such as overdraft facilities, credit card debt, student loans, etc.

30’s – In your 30’s, it may be necessary to shift your financial goals to the potential purchase of a home or to expand your family, to check your claim with that debt you pay and to be with you to join or invest in a company retirement scheme in a personal retirement annuity. Other long-term investments should also be considered at this stage.

40’s – In your 40’s you need to focus on savings, so purchasing a stock portfolio or savings account is essential. All salary increases and bonuses must be seen as an opportunity to contribute more to your pension fund or savings account.

Eventually, your 50’s – Time to decide on an exact retirement age. This should serve as a guideline for your savings strategy as it will determine how much effort it will take to achieve your financial retirement goal.

Take control: If you have control over where your pension is invested (either a personal or company pension fund), look at where and how your money is invested. You can always switch to safer options if you have enough knowledge, although I recommend that you request a professional opinion.

Increase your contributions: If possible, increase your monthly savings to make sure you spend as much money as possible before retirement.

However, be wise: do not overload with savings, it is important that you have enough money to cover your monthly expenses.

Consider other options: If you feel you will not be able to save enough for retirement and you would like to increase your potential retirement income, consider other investment options. Dividend shares and shares, among other things, may be ideal.

Plan ahead: Your future is uncertain, so several other factors need to be included in your retirement planning. There is a great possibility that you can reach an old age home as an elderly person, so you should try to save enough to cover such fees as well.¬†Your savings can already be paid in your 50’s or as you move closer to your retirement age.

However, make sure that you save as much as possible during this decade, so you can take advantage of the fruit and, at the end of the day, you can overcome your sales by date.