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Retirement is closer than you think.

Updated: Feb 25

Retirement Planning will be one of the most important things that you do whilst you are able to earn an income.

Retirement portrait

As we enter the second quarter of the year, I wanted to take a moment to remind you of the importance of retirement planning. Retirement may seem far off, but the truth is that it can come sooner than you think.

Far to often people will say, I will look at it in a year, and the following year, the next year and so forth, then it hits you and by then it seems impossible to reach your income goal.

With life expectancy increasing and many people choosing to retire earlier, it's crucial to start planning for your future now. If you are saving towards retirement, the question you should be asking yourself, is "Am I saving Enough?" the real answer you give yourself will shock you!

In my 17 years of working in the insurance and investment industry, I have seen firsthand the consequences of not taking retirement planning seriously. Only a handful people I know of have been able to retire with enough savings to maintain their standard of living immediately prior to retirement into retirement. This is not because earned massive incomes or won the lottery, but it came from taking deliberate steps during their working careers where they saved and saved some more.

You only have so many paychecks left in your working career until you hit retirement age. And Compound interest can work wonders for your savings, it can only take you so far. It's important to take proactive steps and contribute regularly to your retirement accounts.

The scary thing about society today is the fact that I see individuals earn R50'000 per month in income, then gladly pay an installment of R10'000 per month towards the flashiest cars, but when it comes to their retirement planning, they think that a contribution of R1'000 per month (which is 2% of income) will allow and buy them financial freedom when they retire.

Come on, be real here. The minimum that should be saved is 15% of gross income from your first paycheck to retirement, and then you should be okay. Scary isn't it?

While it's important to enjoy your hard-earned money, it's also important to prioritize your long-term financial health.

Consider meeting with a financial advisor to discuss your options and develop a strategy that works for you. And remember, every little bit counts. Even small contributions can add up over time.

I encourage you to take retirement planning seriously and make it a priority in your financial planning.

Your future self will thank you.

Stay safe, and have a good day further.

Your Financial Planning Partner

Albert Johnson

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