Do You Want a Comfortable Retirement?...

February 17, 2014
Yew Kong Lye

The majority of us work hard all our lives and before we know it, it’s time to retire and take life easier and do the things we always dreamed of. A dream come true for me would be to follow my beloved Liverpool Football Club for one whole year, home and away and whatever competition they are involved.  

 

I am sure everybody has their retirement dreams. Some may want to go on that long trip to far away destinations they always fantasised about and others might want to take the time and support the cause that they are passionate about.  

 

Such dreams cost big bikkies. If you don’t plan for it and make your savings grow and invest intelligently, your retirement plans will not happen. Your dreams will remain dreams, gathering dust in a dark corner of the recesses of your minds. So, it’s important you plan for your retirement and the sooner you draw up a plan and put it into action, the better.  

 

Here, I would like to discuss why you need to plan and the reasons why you need to invest wisely for your retirement. It is not intended to be any financial advice because I’m not qualified to provide such advice. Common wisdom and some common sense is the approach adopted here.  

 

 

SCARY STATISTICS  

 

You need to totally get that no one is coming to the rescue in your retirement, not even the government. Over time, it has been shown that the government have tried to scale back social security wherever and whenever they can.  If you want a comfortable retirement, you need to plan and make it happen yourself. Here are some statistics to demonstrate to you why you should build up a healthy nest egg to look after yourselves in retirement: ·        

  • 94% of people die broke ·        
  • 63% of people at retirement are on government handouts or dependent on relatives for their income ·        
  • 84% retire on < $21,000 per annum ·        
  • Only 4% retire > $41,000 per annum

(Source: ABS)

 

Even if you’re amongst the 4%, depending on how much more than $41,000, it is not a lot of money to lead a lifestyle of your dreams in your retirement.

 

 

THE RETIREMENT YOU WANT  

 

To me, retirement means a time to take it easy, stop and smell the roses and do the things that you’ve always wanted to do but, never quite have the time or the funds to do them. You deserve to reap the harvest of your hard work. Why not? You’ve work hard all your life and you deserve to enjoy your life now.  

 

Rewards are important and being able to do the things you want in retirement is a just reward. If you want that reward, you need to do what it takes to make that happen. It’s a time when life really starts. The grind of producing an income is over and it’s when life becomes meaningful.  

 

A retirement unplanned is a retirement unfulfilled. I’ve seen people who are so absorbed by their jobs and when they retire they feel so lost and diminished that some of them just keel over and perish    

 

 

FREEDOM    

 

Freedom at any price and wars has been fought in pursuit of it. What is freedom in the context of retirement and why is it an important consideration? A good and healthy nest egg accumulated through the course of your working life offers you freedom.  

 

It offers you the freedom to have a life. That means the ability to enjoy a reasonably good lifestyle-to pack your bags and go off for a holiday without having to worry about the cost of the airfare, to walk into the supermarket not have to think about the price of a chicken, to show your near and dear an experience you want to share or whatever a reasonably good lifestyle is to you.  

 

Also, it offers you the freedom to give a life. At the end of the day, there are only so many houses you can live in, so many cars you can drive, so much caviar you can eat and so on. What will provide more fulfilment is your ability to help - your family, community or any cause that you are passionate about.  

 

A wise man once taught me that money just offers you these 2 freedoms, to have a life and to give a life. To the wise man, and I subscribe, that’s all money is good for.    

 

 

SEEK FINANCIAL ADVICE  

 

You don’t need to know everything, just surround yourself and build a team with smart people who know a lot. A good team in terms of planning for your retirement should consist of a mortgage broker, a tax planner, a solicitor and last but not least, a good financial planner.  

 

For a start, a good financial planner is one who charges on a basis of fee for service and doesn’t derive his income from the products he promotes. In my opinion, a good financial plan ought to include strategies in a variety of vehicles of investment, not just managed funds. A strategy without considering real estate investment, always look a bit sus to me. Try to find one with a wider licence so that if you have the appetite for it, he/she can put your investments in riskier vehicles like international equities, currencies or derivatives     

 

 

Sometimes we are so busy going around on this merry go round and before we know it, retirement beckons. Don’t get caught and the only way you can avoid surprises is to know what you want in your retirement and plan carefully for it. “It does not do to leave a dragon out of your calculations, if you live near him.” J.R.R. Tolkien, The Hobbit.

 

If you want to slay a ‘dragon’, call me on 0413 871 888  

Posted in: Financial planning

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