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Retirement planning basics

Retirement planning

Retirement planning

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Retirement planning basics

The idea of retirement may be scary, especially if you’re in your 40’s (or older) and haven’t given it too much thought up to now. Retirement means different things to different people though, and your planning should be unique to your own needs, goals, and lifestyle aspirations. Let’s look at some of the retirement planning basics.

Let bygones be bygones

First off, no matter how old you are or what your personal circumstances may be, you need to let bygones be bygones. Whether it be bad financial decisions you may have made in the past, poor career choices or a failed business, what’s done is done and there is no use is pondering “what if”.

On the flipside, of course, are the great decisions and opportunities you took that got you this far. Whatever your situation, understand that you cannot change the past, but you sure can make plans for the future and set yourself on a course that will make your future self proud.

Assess your current financial situation

It’s always good to know what your overall financial situation is. Things may not be as bad as they seem, or they could be worse. But how can you really make any plans or financial decisions without knowing the facts?

Three areas to start with are:


List all your investments and find out what the current value of each is. Whether you have unit trusts, shares, savings accounts, a retirement annuity, a company pension fund, or general “policies” that you don’t even know the details of.

Find it all out and take note of the providers, products, fees and monthly contributions. (Read my post on why fees matter)


Next up do a similar exercise relating to your debts (all of them). Take an honest look at how much you owe and how much you’re paying towards debt each month.

Create a monthly budget

The final area to assess is your monthly budget. Looking at what you earn versus what you spend, and making sure that you can invest something for the future. If you’ve never made a budget before then the Budgeting 101 series is just for you!

Understand how much you will need

Now that you have a better understanding of your current financial situation, you can look at what retirement goal you should be aiming for. There are various methods to use at but the 10X Investments online retirement calculator is probably your best starting point.

It’s a super easy interface with a few questions that will help you see how much you should be aiming at for retirement, as well as how far along you are.

Start making a plan

Armed with the details of your current financial situation along with your retirement goal, you’re ready to start making a plan.

You could start with some calculations to see what a monthly contribution growing at a set percentage would turn out to. Such a calculation won’t be accurate as growth on investments fluctuates, but it will give you a sense of what is achievable. Have a look at this one on how to use the Future Value (FV) formula in Excel (or Numbers for Mac users)

Another idea is to break your retirement goal down to smaller goals that you can work on each year. Tweaking your budget may help in this regard.

You may also consider consolidating investments or moving your investments to providers with lower fees. 10X investments offers some of the lowest fees in the industry, with a less than 1% fee (ex VAT) on their Retirement Annuity (RA) product. Definitely worth considering.

Think about ways to increase your income

There’s only so much cutting back of expenses that one can do but earning extra income is a game-changer. This could make a huge difference to your plan and possibly help you to reach your goals sooner.

The sky’s the limit with regards to ideas, but anything you do or try would need to be within your reach and your skillset. Ideas include renting out a spare room, walking peoples dogs in the evenings, starting a side-hustle that you can work on in retirement, finding a product that you can sell or even just negotiating a raise with your current employer. Let your imagination go wild.

Don’t be afraid to look for new ways to earn income.

Retirement planning basics

No amount of planning, calculations or future predictions will ever quite be 100% right. Life happens and the future is full of unknowns. But, if you regularly assess your finances and look at future goals you’ll be able to adapt to change before it’s too late.

I keep an eye on my retirement goals each year. I don’t always need to make any changes to my plan, but sometimes I do. A little tweak here or there, a little extra invested, or changing my calculations based on new information keeps my plan up-to-date and relevant.

It’s never too late to start planning for retirement!

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