As retirement looms on the horizon, the quest for financial security becomes increasingly urgent.
Financial experts have warned of a disquieting truth that a significant number of employees face precarious financial shortfalls as they approach retirement.
Facing the precipice are members of the Generation X, according to Sanlam risk and savings segment manager Farzana Botha, who says this population group is sadly off the cuff in terms of saving for a comfortable retirement.
There is a division among South Africans. A recent study conducted by Sanlam suggests that 25% of the Generation X members over 50 plan to retire completely, while 24% are determined to continue working over the retirement age due to financial concerns, regardless of income levels.
Botha contends that fear of lifestyle changes or insufficient savings may explain this trend, calling for a conversation on financial planning as people age.
As the members of the Generation X trod towards retirement age, their eyes no longer glaze over during financial discussions, anxiety is creeping up on their stability.
Botha says those who are not on track with their retirement savings need to start making tough decisions.
“Often, anxiety brings apathy and inaction. Work with your adviser to move past this.
The sooner you act, the better and more in control you will feel,” she said.
By taking proactive steps, one can overcome financial shortfalls and look forward to a more secure and comfortable retirement.
Here are some key steps to navigate these financial challenges, provided by Botha:
- Stay informed about your financial standing. Botha has advised individuals to evaluate their finances to determine whether they are on track with their retirement goals. This includes making sacrifices, cutting down on useless expenditure to increase retirement contributions.
- Make your money more efficient – explore opportunities to maximise tax reductions and redirect funds to boost your retirement savings.
“Work with your adviser to make your money work harder for you,” she said.
- Consider agile products – Investigate retirement products that offer both fixed and variable options for growth and peace of mind.
- Chatting to a life coach – Consider starting a second, softer career in retirement or starting a business. Botha has emphasised that a life coach can provide direction and clarity on how to personalise this journey.
