Why You Need to Save For Retirement
Why You Need to Save For Retirement
If you are planning for financial freedom when you retire, you should start thinking of setting up your pension fund now if you have not already done so.
These days, due to good nutrition and healthcare, people are living much longer. And because of the longer life-span, you need to ensure that your pensions and savings will enable you to enjoy your lifestyle in retirement.
It is important to save for retirement to ensure that you have adequate retirement income to support your lifestyle when you eventually retire from work. The UK basic State Pension for 2010-11 is 97.65 per week, and if the basic State Pension is your only source of retirement income, then it is likely that you will have need to take up a part-time job to supplement your income when you retire.
There are several financial questions you should be asking yourself at this stage:
Will you have adequate pension to support your new lifestyle?
If you are employed, are you taking advantage of your employer's contributions towards your pension? Use this free money from your employer to build up your pension fund.
Are you taking advantage of the tax system to boost your pension fund?
Are you using the power of compound interest to build up your pension pot? The sooner you start saving for your retirement, the bigger your pension fund when you retire. Let time and the power of compound interest work for you.
It is often not easy to save for retirement, especially when you are starting a family and have to pay your mortgage. It is true that the needs of the family should come first, but your retirement planning should not be totally ignored because it takes time to build a pension fund to support you in retirement.
Some sacrifices will have to be made to enable you to start saving for retirement. For instance, it is a good opportunity for you to quit smoking, reduce pub-crawling or eating out.
Initially, you can save a small amount each month. Take advantage of your company's contributions to build your pension fund. Then increase your savings when your financial position improves.
The most difficult part in retirement planning is taking the first step. Once you have set up your saving or investment account, money will be taken out of your bank account each month by direct debit and you won't need to think about it until you decide to increase your savings when you are able to do so.
Saving for retirement may not be a priority when you are in your 20s because retirement seems such a distant future. However, in order to build up a decent pension fund when you reach retirement age, you need to start saving in your early 20s. Use the combine power of your employer's contributions, tax benefits, compound interests and, above all, allow time to build up a substantial pension fund.
It's vitally important to give your retirement planning some thought before the retiring from your full time job. You can then look forward to this new phase of your life with anticipation, knowing that your financial planning for retirement will be successful to support your new lifestyle.
How Lawyers Can Save You Time and Money Plan Your Retirement! Starting Your Career as a Hedge Funds Lawyer Company Lawyers Cannabis Lawyers Senior Living Facilities – Lead an Independent Life after Retirement What To Look For In A Good Criminal Defense Lawyer How To Choose Houston Divorce Lawyer Accomplish your Dream with Retirement Plan Retirement Plan: The Mystery of a Happy Life Think Before Choosing the Retirement Plan Oklahoma Criminal Defense Lawyer How To Find A Good Toronto Divorce Lawyer