Have you ever thought of retiring some day? You might feel like you still have a long way to go especially, if you are still in your twenties, but trust me, this might likely be your biggest savings goal. The earlier you start saving for retirement, the longer your savings will benefit you.
Retirement is the act of stopping work because you have reached a particular age, it is also the period of a person's life during which he or she is no longer working. After retirement, an individual needs are usually met through any combination of resources including a pension plan, benefit or savings accumulated by you, the standard age of retirement in Nigeria is 60 years, America's standard age of retirement is 65 years, although some individuals may choose to retire earlier or later than this age due to some reasons (could be financial, physical reasons and so many other reasons).
Retirement plans have two aspects, and they are (1) benefit which you get from your work place after your service years and (2) contribution which you are able to save during your service years, the two aspects play an important role in the sense of helping retiring individuals accumulate money to spend at their retirement age. The essence of retirement plan is basically to sustain and retain employees' welfare by providing financial security for different retiring individuals after their service years.
According to Aon Hewitt survey, more than 400 companies gauge their current future retirement perspectives, it was discovered that employers have two additional goals for their retirement plans:
Retirement plans are part of a broader financial picture for retirees, and any goals for retirement plans must align with goals for overall financial well-being.
Employer who sponsors defined benefit plans are looking for ways to minimize volatility of accounting expense and contribution requirements for their pension plans.
Together, these goals indicate employers have moved beyond the tactical viewpoint and are taking a far more strategic perspective by looking at how retirement plans fit into the greater goals of the organization.
Ready For Retirement!
Here are some steps you need to put into consideration before retiring from work:
Prepare for your future at every stage of life
The inconsistency in all aspects of amenities of life has made retirement plan more important than before, for example, the rising health care costs, uncertainty of social security, changes in corporate retirement plans, the realities of retirement today make planning for your future more important than ever.
Saving For A Better Retirement
Creating a retirement plan is a key component of building a solid financial strength. You can determine how you want to spend your retirement and how much it could cost. Your final analysis will factor in your current and estimated income and assets, and uncover potential shortfalls, showing you ways to address them.
Your Financial Adviser will then help you create a savings and investment plan that combines your near term objectives with your longer term retirement goals and can work with you over time to monitor and quantify your progress.
- Here are some tips you need for to consider for a successful savings
- Invest early and often: Saving towards retirement early will help you have more savings than normal.
- Boost your retirement saving: this simply means if you are supposed to save 5 % of your income for retirement, you can increase your savings to 8% or more.
How Prepared Are You For Retirement
With retirement fast approaching, it is time to start thinking about the life you envision and whether you are on track to reach your goals. As you approach retirement, your attention will automatically shift from saving for retirement to funding your retirement. In this stage you will need to work hand in hand with your legal Financial Adviser (though not compulsory) in order to adjust your strategy, with a focus on preserving what you've saved and ensured that the money will be there for as long as you need it.
Your Financial Adviser will review strategies that can help set aside your financial asset holdings based on when you are likely to need the funds—so that you can have the income you need to meet your expenses early in retirement, while the balance of your portfolio remains invested for capital preservation and growth.
The following tips will help you achieve your envision in retirement
1. Maximize your work place retirement plan
2. Make catch-up contributions which means any savings you have have skipped will need to be saved at this point.
3.Boost your Retirement savings: As a general rule, your retirement portfolio should be 25 times larger than the amount you expect to withdraw from your first year of retirement.
4. Explore additional ways to save.
5. Need to play catch-up
Here are some few ideas to help make your savings last longer:
Postpone retirement by a few years later, retiring later can allow you build a bigger retirement spending.
Work part time:Doing so does not only generate additional income but also provide intellectual stimulation, social interaction and a feeling of purpose.
Get out of debt: Save yourself money by paying off variable high interested debt.
Living in Retirement
When you are working and saving, the concept of retirement may seem like a single event. However, more people for both personal and financial reasons are re-thinking retirement. Your retirement savings may be the primary source of your retirement income. You need careful strategies and guidance to help successfully manage your income in retirement and preserve the wealth you've accumulated for yourself and your heirs.In Retirement, you need a thoughtful planning like:
Determine your spending needs
It is suggested that you take a close look at your expenses, some might change in retirement while some may decrease or go away totally. Your expenses matters during retirement. Create an atmosphere of managing your spending needs. Doing this will help you achieve your retirement plans.
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