There are many schools of thought on the right time to prepare for retirement. Some financial advisors say five years is sufficient while others say ten, but within our Jamaican reality, it is advisable that individuals begin retirement planning as soon as possible. Those who work within the formal business or government sector will have the benefit of a mandatory pension scheme that deducts up to 5% of your monthly salary and places it in a long-term investment plan better known as a retirement plan. These workers also have the option of voluntarily contributing up to 15% more of their salary to this plan.
As with any long-term savings plan, the earlier an individual begins preparing for retirement, the more disposable income will be available in those years when that individual can no longer work.
In planning for retirement, it is important to not only depend on the funds that were saved during the years that you were employed. Begin retirement planning by setting clearly defined life goals and putting together a financial plan to achieve those goals upon retirement. Savers must begin to plan early to take advantage of compound interest and avoid financial risk. Look at your life today and think about how you expect to live after retirement. Some costs may decrease such as transportation, but others such as medical costs, may increase.
Saving for retirement does not mean simply “BANKING MONEY’
Budgeting is a critical element for retirement planning. Realistic budgeting is one of the best ways to ensure that you are sticking to your saving plan. If you are already saving for retirement or any other goal, push ahead. Again, the sooner you start saving, the more time your money has to grow. If you are about to hit 50 and you have not yet started saving, don’t beat yourself up, its better late than never!
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There are many schools of thought on the right time to prepare for retirement. Some financial advisors say five years is sufficient while others say ten, but within our Jamaican reality, it is advisable that individuals begin retirement planning as soon as possible. Those who work within the formal business or government sector will have the benefit of a mandatory pension scheme that deducts up to 5% of your monthly salary and places it in a long-term investment plan better known as a retirement plan. These workers also have the option of voluntarily contributing up to 15% more of their salary to this plan.
As with any long-term savings plan, the earlier an individual begins preparing for retirement, the more disposable income will be available in those years when that individual can no longer work.
In planning for retirement, it is important to not only depend on the funds that were saved during the years that you were employed. Begin retirement planning by setting clearly defined life goals and putting together a financial plan to achieve those goals upon retirement. Savers must begin to plan early to take advantage of compound interest and avoid financial risk. Look at your life today and think about how you expect to live after retirement. Some costs may decrease such as transportation, but others such as medical costs, may increase.
Budgeting is a critical element for retirement planning. Realistic budgeting is one of the best ways to ensure that you are sticking to your saving plan. If you are already saving for retirement or any other goal, push ahead. Again, the sooner you start saving, the more time your money has to grow. If you are about to hit 50 and you have not yet started saving, don’t beat yourself up, its better late than never!
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