Building block walls ahead your retirement

You have planned for years that 2016 is the year you will retire. You probably have put several plans into place to ensure that nothing goes wrong. The company is getting ready for an elaborate farewell party at the end of the year. In some occasions it is the company that is set on retiring you. What you might not have envisaged is high inflation at 12.8, fuel scarcity forcing pump prices to jump as much as N150, commodity prices going up 100 to 200 percent as a result of forex crunch and policy responses.

Times are changing. Retirement is different now that it was in years past. Your savings may be significant, but the purchasing power may not be as powerful like few months ago. Expectations in today’s world are many times different from what it used to be. These expectations are often conditioned by the present realities which is why careful consideration in strategy development is very important.

Common misconceptions that also need to be examined include the desire to continue working while in retirement. In a recent report from Aviva, forty percent of people in their 50s expected to work until 70 or older which according to the report was a sign that the days of early retirement – in the private sector at least – were over. However, according to a 2016 report by JP Morgan which followed the Aviva report, majority of people who plan to work beyond age 65 never accomplish it. There are certain factors that may cause people to retire earlier than expected such as health problems, employer issues and family obligations.

Nevertheless, nothing stops anyone prospective retiree who is determined to work not to do so. The challenge is finding an employer willing to hire a 50-60 something year old. We always recommend that you set up your own business. It can be small but something that gives you extra income and helps you maintain an active commercial life.

Another misconception is presuming that your spending pattern will not change once you retire. Already prices of goods have increased since the beginning of the year which has caused many to adjust their personal budget allocations for 2016. Bearing that mind, you will need to review your spending strategy. Take your budget for a test run to see if it is realistic. Consult a financial advisor who can help you determine your financial standing.

You need to be financially prepared; planning ahead is your greatest asset. If you have been prudent and taken an investment suggestion which means you have extra income, you should consider opening a health Savings Account. One of the major areas many who retire spend money is on health. Your final few months is an opportunity to advantage of workplace retirement benefits.

If you haven’t done it already, check your retirement savings progress with your pension provider. Go through the numbers and be sure it reflects the true picture of the years you have contributed to the organisation. Inaccurate figures or discrepancies should be reported immediately to the appropriate authorities. Putting your financial house in order will help a smooth transition out of the workforce.

2016 may have started out as a very tough year particularly for the country’s economy, but it is likely to change towards the end of it. In fact, several analysts and investors have projected that the fog hanging over the economy will lift and usher in a time of stability. Thus majority of forecasts leans towards investing in the economy now to reap the dividends in a few years to come.