“Retiring comfortably” means having a sustainable income that last as long as you do.
For most people who plan on retiring at 65, to ensure that sustainable income, you need to accumulate between 10 and 14 times your annual salary by the time you retire.
This should enable you to draw a retirement income - for the rest of your life - that is at least 75% of your salary.
When it comes to your retirement, the best tip is to start saving today.
It’s never too late.
If you find it difficult to spare an extra cent; think of where you can cut down.
For example, if you give up your DStv subscription - and save that R600, assuming a very conservative return of 8% for the next 20 years - you could have R550 000.
Other ways to top up your retirement savings include:
Whenever your salary increases; increase your premiums.
When you get a better-paying new job or promotion; increase your premiums again.
When you get your bonus; inject a lump sum into your retirement.
- When the new tax year comes around; take full advantage of the tax benefits of saving for your retirement.
The best investment ever? Paying for financial advice
Everyone’s circumstances and needs are different.
The right answer for your neighbour might not be the right one for you.
Accredited financial advisers are trained to help you to think about what you want to achieve, and the best possible way to achieve it.
Use them; they help you take the emotion out of investing, and provide you with an objective view.
It may just be the best investment you ever make.
Enjoy The Money Show, but miss it sometimes?
Get the best bits emailed to you daily, right after it ends:
This article first appeared on 702 : How much you need to retire ‘comfortably’ (and the best ‘investment’ ever)