Have You Planned Sufficiently for Your Retirement?

Retirement is the longest holiday of your life. ARE YOU FULLY PREPARED FOR THIS?
Kirk McArdle, independent financial consultant, on the one word that should be vitally important to us all.
Retirement.
Mexico. I love Mexico and have spent many holidays there on both the East and West coasts. There is this feeling of “whatever will be and whenever it happens, happens” to Mexico. Why am I writing about foreign holiday destinations in a financial column? Well, we all enjoy holidays and the lazy days when time usually flies and doesn’t have much meaning.
Well, your retirement is the longest holiday that you will ever take and you should be suitably prepared for this.
How long do you take to prepare for a holiday?
Lets just go back to your annual holiday with your family. How long does it take you to plan and save for this typical two-week break? Three months, six months, a year? And this is just for two weeks.
What about that holiday that starts on average at 65 and could last for over 30 years? The sooner you plan and start to save for this the better. The old investing rule of “it is better to save less for longer than more over the shorter term” will indeed be true, especially when one factors in compounding interest.
The eighth wonder of the world (according to Einstein!)
Compounding interest was described by Albert Einstein, the genius who really understood his maths, as “He who understands it, earns it…he who doesn’t, pays it”.
As the following chart shows, the difference in starting a long-term investment early for retirement, against saving more over the shorter term, will always bear fruit with the effects of compounded interest in the medium to longer term.
 

As expats we have to plan for the longest holiday of our life: retirement.
These compounded effects make a huge difference in a financial portfolio valuation by the time your income from work stops. That’s the moment you’ll need to access your savings, when you need them the most of all of your life.
Vital!
Investments and cash geared for retirement is something that should simply be paramount for any forward financial planning that you make for your and your family’s future. My advice for a long, comfortable retirement I have advised my clients that they cannot start too early with saving money. Everybody needs to have a plan in place for retirement. This is especially important for us expats who live in different countries and therefore cannot automatically count on benefitting from any national pension plan.
If you do feel that this is an area for which you are either not fully happy or covered in, then please feel free to contact me to discuss your options.
PS:
At Austen Morris Associates we specialize in helping individuals reach their personal financial targets, and there is no one investment that fits everyone. That’s why we like to sit down and talk to our potential clients about their own private situation and to see if we can be of benefit.
If you would like an introduction to Austen Morris Associates and to find out how we can help with asset planning, then please do contact me on +27 11 514 0745 or at kirk.m@austenmorris.com
Kirk McArdle, independent financial consultant at Austen Morris Associates (AMA).
About Kirk McArdle
Kirk is an avid football fan and has successfully managed to steer his son, Luke 10, into supporting his team, Everton. Kirk also enjoys driving cars and drinking a cold pint of Guinness. Not both at the same time!