Youths and Saving for Retirement
A majority of young people spend lots of time researching on material things like the latest version of cell phones or models of car to purchase but rarely worry about their tomorrow. This is because the most common assumption is that retirement is not fun and takes a longtime to save for. Perhaps their definition of fun is a little different from those who are enjoying their current retirement package. To put it kindly, planning for retirement is largely unappreciated.
ARBS has maintained the annual membership fee at a very low cost of only Ksh.12,500. This is because as the association, we understand that retirement benefits schemes deal with members’ pensions and that maintaining the membership fee that low passes the low administrative costs to the schemes.
There can be real sharks towards the journey to retirement; however, they can easily be avoided if one learns how to spot them early. One must assume responsibility for his/her own retirement in this era of financial insecurity and longevity, if not, nobody else is going to do it for them.
A retirement plan is the key towards living a life free of financial worry as it provides one with a clear road map towards a kinder and gentler retirement.
The time to take evasive action is now. Regardless of your age, it’s never too late to start thinking about the future. Whichever method works for you, the important message is to make retirement savings your priority. You can reduce your expenses and contribute the extra cash to your retirement account. Here are a few tips on how to boost your retirement savings:
- Stay away from debt: If you can do without it, avoid it. You will never be financially free if most of your income is spent on getting out of debt; the costs associated with debt could be used to make extra payments toward your retirement if one opts to cut down on it. This could arguably be one of the best moves you can ever make towards achieving your future financial stability.
- Be keen on the cost of investment: Make sure you are on track to meet your investment goals without overpaying in terms of management fees and if possible negotiating for a lower fee.
- Compare earnings on your savings: If you are keeping cash in a bank account in terms of deposit for more than six months to clear off expenses at a later date, consider moving some of that cash into an investment with the potential for a higher rate of return while you try to figure out your next move. In case of emergency savings, compare interest rates for different investments and ensure that you are earning the maximum interest.
- Evaluate your housing needs: Depending on your circumstances, you may be paying more than you should for your home. Instead consider downsizing by investing the extra money you have for retirement savings or purchase a mortgage to be able to acquire a home before retirement.
In the last decade of a person's life, most of the savings go into health care and basic needs expenses. The earlier one can embrace a good plan, the easier he/she will swim through the deep waters but only if they follow it up with action.