By Sourced by ACM Ahlers, Life. - 8 Dec 2011
For some of us the word ‘retirement’ conjures up a sense of worry, while for others it provokes a sense of excitement. The difference between excitement and worry probably depends on how much time and thought you’ve put into planning for your retirement. Taking the ‘worry’ out of retirement can be achieved right now...
Taking the 'worry' out of retirement can be achieved
right now if you take the time to think about how much money you'll
need, and then make a plan to get there. Plus, with the right help
it's easier to secure a financial future that you can look forward
to. The first step is to work out how much you will need for your
retirement and then putting a savings and investment plan in place
to help you get there.
Consider the following
questions:
- What sort of lifestyle do you want to lead in your
retirement?
- Do you want to own your own home, rent, upgrade or
downgrade?
- Do you want to travel?
- How much do you think NZ Superannuation will be per
week upon your retirement? As at July 2011 the standard annual
after-tax amount of NZ Super for a single person living alone is
$17,676 ($339.92 weekly). For a couple who both qualify for NZ
Super, the amount is $27,194 ($522.96 weekly).
- What amount will be available in your KiwiSaver
account? (Only applicable if you are a KiwiSaver
member).
- What regular income will you need each year to
support your lifestyle - over and above NZ Super and any KiwiSaver
savings you have?
Once you've worked out how much you'll need, the
next step is to make a plan on how to reach your savings goal. This
will involve a close scrutiny of your spending habits now and
working out how to balance your current lifestyle against your
future savings goals. This might mean that you need to make some
changes to your current lifestyle.
Think about how you can make your money
work for you - without taking any unnecessary risks. This could be
building a good quality share portfolio, investing in property,
buying a business, or a combination of all three. Remember that
it's more about what you do with your money than how much you earn.
Obviously it's great to have a high income, but if you're spending
it all then you're no better off in the long run than a low income
earner with the same spending habits.
Whether you're starting from scratch or
reviewing your current plans, the best place to start is by talking
to a financial adviser. They can help you through the entire
process and come up with recommendations to help you achieve your
goals. Once you start down this track you'll start to feel a sense
of empowerment, and consequently you'll be less likely to worry
about your retirement and can start to look forward to
it.