45+ Gaining Wisdom

By now, your kids are leaving school, and leaving you. It’s time to start making really concrete plans for YOUR future. Do you have a clear retirement plan, and are you keeping to it? It’s a good time to reassess this, with the help of your advisor.

Most people choose lifestyle over financial freedom at this stage. You should never live to the full capacity of your income – or worse, create debt to improve your lifestyle. You need to have available capital for your investment activities. So let your nest egg grow and grow, and if you can – add a little extra each month. Every little bit helps!

Remember that saving for the longest time possible is the best thing you can do. Your retirement benefit grows exponentially, thanks to the magic of compound interest – but if you take a portion of this benefit in cash when you leave your Fund, you are doing yourself more damage than you realise. Not only will you be taxed heavily: you’ll have to start all over again, and you have far less time to try and catch up.

If you are in the Life Stage investment option, your money is still being invested for you in a way that is suitable for someone your age. However, if you are invested outside of the Life Stage model, it’s possible that your investments are too conservative, and thus that you are earning lower returns than you would like to. Be sure to check in with your financial advisor so that you can stay on track.

This time of your life is an excellent time to start contributing more to your Fund. Hopefully you’re feeling financially secure at this point, and so making additional contributions is a real possibility, as well as being the best idea you can possibly have. Every little bit really does help in the long run.

The future is not far off now. Your goals at this stage should include paying off debt as quickly as possible, so that you are not burdened with a loan or a massive credit card bill when you retire. Remember, true wealth is peace of mind – not a fancy car or the latest gadgets.