Re­al­i­ties about re­tire­ment

Daily Trust - - BUSINESS -

How do you want to live in re­tire­ment? Do you want to have a mod­est life­style or one where you get to en­joy those things you worked so hard for such as travel or ren­o­vate your home? So how much will it cost? How much have you al­ready saved? Do the fig­ures meet your ex­pec­ta­tions? If not, what ac­tion do you need to take now?

Plan for the rest of your life:

Most peo­ple are re­tired longer than they ex­pect and with med­i­cal ad­vance­ment this is likely to de­velop even fur­ther. Whilst your health and fam­ily longevity will in­flu­ence your life span, if you’ve sur­vived life’s early risks, such as ac­ci­dents or ill­nesses, you could eas­ily live into your nineties or older. Plan for the long term, and don’t for­get that you may need ex­tra as­sis­tance or care as you get older which can be very costly.

Re­view your in­vest­ments:

For your savings to last the rest of your life, you need to in­vest for the long term. And that means get­ting the in­vest­ment mix right, with a bal­ance of in­come and cap­i­tal growth. Di­ver­si­fy­ing your in­vest­ments across cash, fixed in­ter­est, shares and prop­erty will help re­duce risk and achieve smoother, more consistent re­turns over time.

Stick to your plan:

In­vest­ments can quickly change in value. While it can be tempt­ing to sell ev­ery­thing when the mar­ket falls and put all your money in cash, that’s of­ten the worst thing you can do. It’s im­por­tant to re­main fo­cused on the long term as his­tory has shown us the mar­ket will re­cover over the long-term.

Start Sav­ing and Keep Sav­ing:

If you are al­ready sav­ing ex­tra for your re­tire­ment, con­tinue! If you are not putting ex­tra away, then it’s time to get started. The sooner you start sav­ing the more time you will have to save for your even­tual re­tire­ment goal.

Get your af­fairs in or­der:

En­sur­ing that your as­sets you have worked so hard to build up will be even­tu­ally passed on to your loved ones is a crit­i­cal part of re­tire­ment plan­ning and wealth trans­fer. A com­pre­hen­sive es­tate plan al­lows you to trans­fer these as­sets to the right peo­ple at the right time. You should speak to your so­lic­i­tor. Wealth pro­tec­tion is es­sen­tial in main­tain­ing and pre­serv­ing your wealth for your fam­ily and fu­ture gen­er­a­tions. And re­mem­ber to re­view your es­tate plan at least ev­ery three years.

Stay fit and healthy:

If you stay men­tally and phys­i­cally ac­tive, you’re more likely to en­joy a long and healthy life. Keep work­ing part-time, take up a hobby, learn a new skill or vol­un­teer in your com­mu­nity.

Re­tire debt free:

In re­tire­ment the ben­e­fits of hav­ing in­vest­ment debt cease once your in­come stops. As such it’s im­por­tant to de­ter­mine whether it’s worth­while con­tin­u­ing to main­tain and pay these in­ter­est re­pay­ments. The first pri­or­ity should be to pay off the debt on your own home and re­tire debt free. Let’s face it money is bet­ter in your hands than the banks!

Think about the “what ifs”:

The last thing you need in re­tire­ment is for your fi­nances to be af­fected if some­thing un­ex­pected hap­pens. Re­view your per­sonal in­sur­ance needs to make sure you are fully pro­tected. It’s just as im­por­tant now than when you had kids and a fam­ily to look af­ter. An un­fore­seen event could have a mas­sive im­pact on your re­tire­ment plans so it pays to make sure you con­tinue to pro­tect your­self and your fam­ily. Don’t also for­get health and travel in­sur­ance cover, es­pe­cially if you plan to travel a lot.

Use an Ex­pert:

Mak­ing fi­nan­cial de­ci­sions can be com­plex, ever chang­ing and dif­fi­cult to un­der­stand. Seek pro­fes­sional ad­vice from a fi­nan­cial ad­viser to en­sure your plan is on the way to help­ing you achieve your re­tire­ment goals. They can also as­sist you in de­vel­op­ing a plan to bridge the gap be­tween where you are now and where you want to end up.

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