Retirement is a must for every individual irrespective of his or her work status as an employee or self-employed. As a matter of fact, working each day is a day closer to your retirement, no matter how far it may seem at present.
Like the English saying ‘Failing to plan tantamount to planning to fail”, the earlier you start to plan for life post retirement, the better for you.
If you desire financial stability after retirement, you had better start taking decisive steps that would favourably affect your finances.
The road to the future is not something rosy considering the rough economic terrain of the country which continues to keep living cost on the high-side, even as a large number of Nigerians are struggling to make ends meet, let alone preparing the journey ahead.
However, with financial prudence practices, regardless of your current earnings, life can still be meaningful post retirement when you take charge of your financial future.
It is not enough to be totally dependent on monthly pensions or gratuity after retirement, as these monies might not be promptly paid, and this could make life frustrating. This, therefore, underscores the importance of early retirement planning to avert possible future financial catastrophe.
Furthermore, old age is often associated with medical problems and elevated healthcare expenditure. No one prays to experience unexpected ailments that would consume his or her entire retirement savings. However, we can’t rule out natural phenomena, of which sickness is one. This again points to why you need to plan your retirement early.
The following are tips that can help you achieve a trouble-free retired life.
Know your retirement priorities
Every individual has different goals and priorities as far as retirement is concerned. This implies that your retirement income strategy hinges on the vision you are preparing for the future.
You need to itemize your retirement plans and prioritize them as this would give a clue of how your personal lifestyle may affect your income needs in retirement. It is noteworthy to state that you might likely adjust your living standard when you stop working as retirement may be a bit expensive.
Stay away from prodigal spending. Prudent management of your financial resources would save you from running about for financial assistance. Moderate spending would equally help you maintain a steady income flow.
Know how your employer’s pension scheme works
It is noteworthy to state that not all organizations have pension schemes for staff. If you are involved in your employer’s retirement savings plan, there are basic questions you must ask yourself. How much will I contribute to get full employer contribution? And how long it would take you to remain in the plan to get full contributions? Certain sum would be deducted from your gross income, and paid to your pension account.
Before you change jobs, find out what would happen to your pension benefit, and what benefits you may have from a previous employer. Also, you need to know how your new employer’s pension plan works. You can do this by requesting an employee benefit statement to determine the monetary value of your benefits.
Have your own retirement account
You can open your personal retirement account by putting a certain fraction of your income into the account every month. You can as well start with the little you have depending on your capacity. Operating a personal account requires strong determination and focus, to avoid frequent withdrawals.
Basic investing tenets
Don’t let your savings stay idle in the bank. Make it work by investing it in different assets classes, especially in fixed-income securities like Treasury bills, Federal Government sovereign and savings bond, which is risk-free and return-assured.
