More retirement cash needed

DON’T COMPROMISE: WOMEN TEND TO LIVE LONGER WHICH AFFECTS OLD-AGE COSTS

Females, married or not, must ensure they won’t be stranded with lack of cash.

Research by the World Health Organisation suggests women could live to up to eight years longer than their male counterparts. This means their investment or retirement funds will have to last longer too.

Here’s how to get a structured financial plan and savings:

It is important to put money away from your very first pay cheque. Save more when you are able, particularly when you are young and have less responsibilities.

The power of compounding growth over time is too big to ignore. If you have not started saving yet, speak to a financial advisor to put a savings plan in place as soon as possible.

Have a positive attitude towards saving. When the financial concerns of the family become the primary concern, women tend to save less to meet these demands and are therefore ill prepared for their retirement.

Take an active role in your own financial planning. Do not leave this up to your spouse or partner.

Pay off your debts as fast as you can afford to. It is normal to owe money on a car and house, but pay cash as far as you can and don’t live on credit. Live within your means.

As women, we have a right to know what is going on with the family and household finances.

Work as a team and have healthy discussions about future savings and expenses. A spouse may need to reshuffle their personal finances to be able to support the whole family if there is going to be a break in service to raise children.

It is vital that one does not cash in their retirement funds to be able to support them through this time. You will be taxed on amounts that you withdraw and it will diminish your investments that have been put aside for retirement, which will be to your disadvantage in the years ahead.

An emergency/contingency fund will give you peace of mind that you can support yourself and will not be financially stranded. This sometimes occurs with the death of a spouse when funds are tied up and cannot be accessed readily. Furthermore, you could have unexpected medical expenses or even have to pay for mundane but necessary maintenance to your car or house.

Do not be tempted to retire early. Work for as long as possible even if this means working when your spouse or partner has retired.

Meet with a financial advisor: This will provide you with a holistic and effective plan to provide for your needs. A financial advisor can assist in securing your future and building your wealth so that you are able to fulfil essential investment objectives that every person should have.

Mandy Porter is senior financial planner at Alexander Forbes