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1. Save as much as you can, as
early as you can.
The sooner you start to save for
retirement the better it will be for
you! If you begin the saving habit
when you are young it is a positive
habit that you don’t often outgrow.
2. Set realistic financial goals.
Project your retirement expenses
based on your needs. Envision
your ideal retirement life and then
determine how much that life will
cost.
3. Determine your asset allocation
mix.
After determining your long term
goals and taking into account
your risk tolerance, you need to
determine your asset mix. Your
long term returns will vary based
on what proportion of your assets
you will invest in various financial
instruments.
4. Use instruments that can
give your savings a tax deferral
advantage.
During your working years, you
can use a deferred annuity to
accumulate assets. These plans
allow you to accumulate substantial
funds that will provide a guaranteed
pension at retirement along with
substantial tax savings.
Many persons who are under 40 years old have not yet begun planning
for retirement. However, is there such a thing as “too young to plan for
retirement?” Does “the early bird catch the worm? The earlier you start
to plan for retirement, the more prepared and at ease you will ultimately
be. Here are some helpful tips to help you grow your financial wealth and
ensure that your retirement years will be well cushioned.
Are you too young to plan
for your retirement?
5. Participate in a company
contributory pension plan.
Contributing money to a pension
plan at your work place which
gives a matching contribution from
your employers is an excellent way
to begin preparing for retirement.
6. Draw down on your nest egg.
If you are in good health when
you retire, you can draw down
on your money which you expect
to last you for many years. You
should access money from taxable
accounts first and let the interest on
tax-deferred accounts compound
for as long as possible.
7. Cater for medical expenses.
When catering for retirement you
should take into account saving
to cover medical expenses which
sometimes increase as you get
older. Don’t let your nest egg
disappear in medical bills.
8. Make the most out of retirement
assets.
By the time you are ready to retire
you should be in a financially
healthy position whereby you
would have owned your home
free from any mortgage. You can
opt for a smaller home with less
maintenance costs. If you choose
to stay in a larger home, you can
consider leasing out part of it to
obtain an additional income which
can sustain your needs. Be creative!
9. Retired - but working part-time.
Working after you have retired
reduces the amount of money that
you have to draw down on from
your nest egg. Remember however
that most retirees do not command
the salary that they earned when
they were in their prime.
Remember, no one else is
responsible for planning
your financial future
BUT YOU!
TRINIDAD AND TOBAGO
SECURITIES AND EXCHANGE
COMMISSION
57-59 DUNDONALD STREET,
PORT OF SPAIN, TRINIDAD, W.I.
Phone: (868) 624-2991
Fax: (868) 624-2995
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