Everyone has unique circumstances but there are a few life stages that most of us will go through. Saving for retirement is a lifelong process and over time certain factors might influence your ability to save. Here are some important considerations.

A large portion of life is often spent working to earn an income, with the plan being to retire financially independent at a certain age. To do this, it is crucial to set clear retirement savings goals that are attainable, remembering the saying that goes: ‘time waits for no one’.

The beginning of your career
At this stage in your life, time is likely at your disposal; you are young, you don’t have too many obligations and can save as much as possible. You may also be able to take on more investment risk.

Imagine Zanele and Lynn who are both 25, in their first jobs, and each earning R15 000 per month. Zanele decides to be disciplined, sets clear retirement goals and saves 15% of her salary (R2 250 per month). Lynn decides to only save R1 000 per month. If both keep saving for 40 years (until age 65), increasing their contribution each year by 6% and we assume an investment growth of 10% over this period, the end results will see Zanele with R24 867 240 and Lynn with R11 052 107 saved. This clearly proves the power of time and discipline on investments.

Starting your own family
When you enter this life stage, your savings focus might have to change. You may want to purchase a home or need to pay for your children’s education, which means your expenses would increase significantly. Ideally, you shouldn’t reduce the amount you save for retirement at this stage. However, should it be necessary, establish what the outcome would be. A financial adviser can help to determine the impact and if you should rethink your retirement goals, assisting you through all the life stages of investing.

Remember that even if you are married and share a household, you should still set your own retirement goals and have a plan on how to reach them. Life is uncertain and you should always be the steward of your own future.

Seasoned in your career
Once your career has been well established, your monthly income has likely increased while your expenses have stabilised. At this point time is not necessarily on your side but you are in a better position to reassess your retirement goals. Consider your current retirement savings and determine if you are still on course with your financial plan. If you have fallen behind, now is an ideal time to increase your retirement contributions.

Approaching retirement
These days, retirement can be at almost any age as we are living and working longer. To be prepared, you will need to assess your current savings, what your income needs will be and, ultimately, if you are going to be able to retire at the age you wanted to. Now is the time to also find out about the different options available to you at retirement, as well as the investment exposure needed to get you there.

At retirement
This is the stage in life where you are rewarded for your commitment to saving. By opting for a more disciplined approach, you will be able to retire financially independent.


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