The later you start, the harder it will be to prepare financially for a comfortable retirement

They say hindsight is 20/20, however Sagicor is encouraging everyone to avoid waiting until it is too late before realising they have not adequately prepared for their retirement years.

The advice came from Eon Phillips, Assistant Vice President, Insurance Operations; Principal Representative and Branch Manager for Sagicor Life (Eastern Caribbean) Inc. (SLECI), in St Lucia as he discussed some of the misconceptions individuals have surrounding pension planning, along with the steps that should be taken during their most productive years.

“The most common misconception is that pension planning is something that you do later in life. If you’re referring to writing a bucket list of the things you’d like to do when you’re retired, then this is acceptable; however, if you’re talking about preparing yourself financially, then that is an activity that should be started much earlier in life”, he said.

Mr. Phillips made the point that the average working life is around 40 years. This is followed by an average retirement period of 15 to 20 years, which is a long time to be able to live without the requisite amount of funds.

He said, “Typically, you need 65 to 80 per cent of your pre-retirement income to live comfortably throughout the course of your retirement, assuming that by that time you would’ve cleared off major expenses such as your mortgage, car loans and the expenses related to the care of children. Unfortunately many individuals wait until they’re in their 50s or even later to start thinking seriously about their retirement finances. They then try to save quickly in 10 or 15 years what they could have been saving gradually over 40.”

Mr. Phillips emphasized, “If I could leave you with one thought, it’s to think about retirement planning now. To start, just consider your current age, the stage of life you are in, your current income, and imagine the quality of life you want to live during retirement. “Once you have made this assessment, it’s not so hard to set financial planning goals.”