Retirement Planning: A New Year Resolution Worth Having
As the saying goes “Youth is wasted on the young”. Often, so is money. We all expect young people around us to make judicious use of their youth with an eye on the future. Interestingly, this should be same for us the adults. What do we know about retirement planning? How well and early do we plan for the later end of our career? How well do we ensure financial security in days when we are no longer active and productive?
According to an article by ThinkAdvisor, titled ‘The History of Retirement’, our ancestors before the 19th century were people whose livelihood depended on working the earth. “They’d farm until they’re physically unable to do so, but chances were good as their children would take over their duties as they aged and they’d stay in their own homes until death, alongside multiple generations of family. As the Industrial Revolution took hold, people left the farms in droves and a large labour force began to emerge, with the need for decent wages and a sense of security. In 1875, the American Express railroad company set a precedent by establishing the first private pension plan in America. Banks, utility companies, and manufacturing companies quickly followed suit and established pension plans funded mostly by the employer.”
Today, financial or retirement planning has assumed global acceptance and adoption. According to Wikipedia, “Retirement Planning, in a financial context, refers to the allocation of savings or revenue for retirement. The goal of retirement planning is to achieve financial independence.” Ideally, retirement planning should start with your first job and it is never too late to start, it will enable you build wealth painlessly and securely.
Considering that retirement planning should be as attached to our career, as the skin is to the flesh, one can correctly say that this would form a critical part of our annual New Year resolutions. If not, what have you been waiting for?
Well, we can help with that. To ensure your dream of a secure and comfortable retirement, you need to have a full grasp of your finances. Here are some guidelines that should help model your financial plan.
Read also: Insurance Cover Everywhere You Go
Get out of debt and remain debt-free
Doing a budget is an easy way to getting out of debt. To get out of debt, simply do a list your monthly expenditure, identify unnecessary expenses that add to your household costs and wipe them off the list. Example: TV subscription etc.
The saved money from this can be redirected toward paying off your debts to free up extra fund for long term investment in stocks, insurance products etc.
Have a financial plan
Let’s take a financial plan like a travel plan for instance; you must identify where you’re going, when you’ll get there, what you want to do in transit, which form of transportation you’ll use and how much everything would cost. Most times, your spending can go out of your control, especially when you do not plan. So it is very important to know the current prices of the things you need, balance your budget and stay on track in order to fulfill your financial goals.
Have an emergency reserve
Calculate how much you would need in the event of an emergency and save it up where it is not easily accessible until an inevitable emergency arises. The discipline ensures you do not fall out of line with your budget in relations to expenditures.
Insure your investments
By taking an insurance cover against financial loss on your life, and other valuable assets, you cleverly insulate yourself from the interruption and impact of unplanned expenditure that a sudden destructive incident of loss could subject you to.
The assets that need insurance cover include your vehicles, house or apartment, the content of your house, your jewelries, and your movable assets such as computers, to mention but a few. In addition, you, your family and business/work need insurance to prevent the effects of mishaps when life happens. Insurance policies could be procured to cover the risk of road accidents, theft and burglary, death, fire outbreak, flood etc. Insurance also covers the cost of litigations, should an accident around your asset lead to a legal action.
Get a Leadway Deferred Annuity
The Leadway Deferred Annuity Plan helps you save towards your retirement. It’s a plan whereby you contribute & accumulate savings over a preferred period of time up to retirement. This can, however, be used as a tool to augment any existing retirement scheme.
The contributions or savings are accumulated in a dedicated account and built up over an agreed period up to your retirement date. Upon maturity or retirement period chosen, the accumulated fund can be collected as a lump sum or preferably used to purchase a Life Annuity Plan (this provides regular income for life). It is specially designed for self-employed persons wishing to save towards retirement or for those willing to augment income from their employer(s) sponsored Retirement Savings Account (RSA).
The plan also offers a life insurance cover for the Policyholder; should death occur during Deferred Period, the accumulated value of contributions is payable to an agreed beneficiary. This is in addition to the Life cover benefit of N1m.
Looking forward, we must agree that it is not too late in the year to have retirement planning as your New Year Resolution. Call the Leadway Customer Service on (01) 2800 700, 2800 701, or send an email to Lcs@leadway.com for more details on Leadway Deferred Annuity Plan.
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