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TI-lURSDAY, JUNE 16, 2011
How to have a comfortable retirement
people thin k about retirement, who are just beginning thei r them. retirement Is still fa r away - I~al is if they think about II <!I t a ll. We are q/;ick to associa te reti rement with Ihe elderlr. In addition; we are caught u p ."~c"o",,those
wi th worrying about today that we fo rget
10 make provision for the futu re. For these reasons. many employees fi nd it d ifficult to sustain themselves lit reti rement. ReUTemen! plan ning ensures thai yo u
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continue 10 earn reasonable income that enables you to lead a comfortable lifestyle even wheh you aTe no longer worki ng. Why yh u n eed finan cia l pll'lnnlng This subject brings to mi nd the proverbial saying ~a man who I<lils 10 pl,m is ultimilolely planning lo 'fail [t is Important to note that whethe r you run your own business or work un de r the employmen't of an organisation. fina ncial w
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plllnning is a topic th ai in fl ue nces yo ur quality o l li le to II large exlen t. Retirement plllnning has changed and people now work longer. But before att a im ng the age 0 1 re tirement. you can start prepliring for it by following some investmen t plans liS early as you can . Below are lips to consider in ac hievi ng a succeuful retirement; • Pla n for long retireme nt but min d lo n gevit y ills u ell ·Before retirement, ellperts advise thai you 1" 1,' .r.ol plan for II long retirement but conside r longevi ty faelor in making you r Investment deciSions. Today. retirements can easily last 25, 30 o r mnre years. Many people under• Acll ng Manag ing alredor, estimate how long they Stollblc 18Te Pensio n . Mr. will live and fail to save Dblllllia AboJue enough money to l<1$t thei r lifetime. Check several online life expectancy calculators to provide personll[ life expectancy estimlltes bllsed on fadors such as current age and health habits. • Pr epaTe a retire m e nt spendi n g p lan : Slar! wllh a !1st of currenl lncome lind expenses. Look at the list lind decide whic h I!IIpenses will continue (property laKeS) , end (comm uting costs) o r be reduced (clothing)
Useful hihtS. • Re tirem e ntplanninghaschange d. people now work longer • Plan for a longe r retire m e nt but follow an investment plan early • After retirement, it is ' best to plan withdrawals carefully and co n ~ ider working longe r after you retire; then list new expenses that will begin in reti rement (healthcare cost) . Rnally. Kdo the math" and create II post·rellrement spending plan where income is greater than or equal to expenses. • Foll ow a n in vestment pl an : In loday's self·reliant retirement planning envi ronment, many workers a re their own pensio n man llge r. Invest like a financial institu tion and not a ne rvous investo r bllsed on a well·thought out plan and not driven by emollons such as fear and greed 'Inues t as much <'IS you c<'In as e a rl y as you ca n : When you gel a raise or promo ti o n, increase savings in tax-deferred employe, savi ngs plans. Savings will be deducted from you r paycheck. Aim 10 save 10 pe r cent of gross income in your 20s and 30s and gradually boost savings to 15 per cent in you r 40s and 20 percen t or mo re 50s and 60s.
• De ve lop a n asset a ll ocallon strategy a nd sUck with it: Determine a prefe rred weight ing of investments (e.g .. stock, bonds, and cash asse ts). Keep some stock or stock funds in your portfolio to hedge inflation. Periodically rebala nce to get back to the targe t weights. Avoid being a ma rket timer by moving money du ring volati le markel$. Investors who do this ollen miss the -best market days~ when the market re bounds. • Wo rk lo n ge r Soml! financial ex perts recommend working un til full retirement lIge to achieve what is known as a -Positive Pe rfect Retirement Storm. ~ Benefits include: larger pension benefits. additional lime for re tiremen t savings plan d eposits and conti nued access to employer benefits, among ot hers. • En vision t.h e futur e Do n't wait until you·re ready for retirement 10 figure out what you want to do. Silirt thinking about life lifter full· time work at least a decade before. Ask yourself questions, such liS: KWhat do I w"nl to do?" and ·Wha t m"kes me happy?" There is no right M o ne size flls all" answer because personal values and retlremen t resources vary widely. • Pl a n yo ur li festy le Do you want 10 stay in your current home, move to an Old People's Home, or move closer to family members? How will you spend your lime: travelling, starting a business, voluntee ring? Studies h"ve found th"l being adive with a network of friends is a m"jor ingredient for happiness in retirement. • Downsize you r debt
into new agric programme ~ lniertllltional Rmd for Agria.JJturai Development will inject $75m into l lhe new Value Chain Development Programme whkh is now in its design 5Iage, an offJdal has disdosed..
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"The IFAO CounlJy Programme Manager in N".geri.a. Mr. Abdou! Barty, disclosed this in an interview with the News Agency of Nigeria in Abuja on Wednesday. Barry said thai the programme, which targets Nigeria's \\.va major staples. c.assavaandrit:e,enwged from theUN agency'sCountryStnltegicOpportuni\ies Programme approved by IFAD·s I!:"(l!OJtive board in April 2010. Hesaidtha t theprogrammetugetedsma1lholder farmers, indudingwomen, youths and men lIdiwIy involved in "!JiruIture and IAIOllId be implemented UlTOIJgh Ule Community.driven Development approach. He ~id that before the commencement of fuU implementation of the
programme. farmers and fillTl"1el" ory<lIlisations in general. VJOUkI be sensitised \.\.-nile the National Monitoring and EvaIu<Ition system would illso be stnmgthened. Barty said that $(15m had been earmarked for Ihese two activities, lidding thai $D.4m woukl go for the sensitisation while $Dol m was for M&E strengthening. On the issue 0( po5SI.ble co-fmancing of the programme. the Counify Programme Manager said IFAD v.oas wi!Iing to roIlaboralR with the African Development Bank and the Alliance fOf Green Reo..Qulion in Africa. He explained that [FAD had approached the A!DB for possible ronaboration on the new programme and tnalthe bank could only decide where to Invest Its resources when its Country Strategy Programme for Nigeria v.'i!Srecv::ly.
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Try to payoff your mortgage prior· to retirement using strategies such as p rincipal pre-payment <'Ind/or biweekly paymen ts. Not having this large mont hly expense c.an help retirees who are living on less income. ' Co mmunlcat e w ith 0"' s pouse/partner Many couples never talk about retirement decisions. A 2009 study by Fidelity Investments found that 60 per cen t of married couples did not agree on thei r respective re tiremen t ages. 44 per cent did not agree about whether they will work in reti rement, and 42 per cent h"d different ideas about their expected retirement Hfestyle. Source: Stanblc IBTC Pensions