We’ve written several blogs on planning for retirement and this is yet another to add to the quiver.
Why is this so important? Because financial planning and provision for retirement is often relegated to the bottom of the budget and is only seriously considered when it is seriously too late.
Current reports tell us that only around 6% of South Africans can retire comfortably. That means that three out of every fifty are comfortable in their golden years. For virtually every gainfully employed person, their company retirement plan is not sufficient.
Old Mutual Chief Economist Rian Le Roux said that most people are not realistically considering future liabilities that ‘may include anything from paying for a child’s wedding to a child’s education and more importantly for retirement.’
In reference to a survey done among South African retirees, Le Roux noted that about 60% of those surveyed had a shortfall of income to cover their expenditure last year (2013), and had to cut back on certain expenses.
“Very often people only look at their retirement funds a year or two before their retirement and some don’t even bother to do that, and then one or two years into retirement they discover that they don’t have sufficient capital in their investment funds to be able to give them a good financial situation during their retirement.”
When it comes to saving for your retirement, the sooner you start the better. Most long-term investments show the greatest growth in the final few years; growth that is exponentially greater than the formative investment years. Compound interest benefits the patient, prudent and diligent.
Saving for your retirement is not a guessing game. Chat to us today and let’s review your retirement plan and make sure that you are still on track for your retirement dreams!