Top tips to retire in style

Are you ready for retirement?

Think of retirement as the pot of gold at the end of your rainbow. How big will that pot be? That depends on you and how much income you will need each year to live comfortably in retirement. There are several considerations whilst planning how to accrue your gold - without compromising on the colour of your rainbow! To give you some perspective, here are some retirement reports from around the world.

Retirement reports from around the world

UAE

A recent study by Khaleej Times shows that only 48% of expats in the UAE save regularly for retirement. 33% have an investment portfolio dedicated for retirement. 53% of them claimed the value of their investment was less than $50,000 (183,500 AED) and 76% said the value was less than $100,000 (367,000). Will they be ready for retirement?

India

33% of Indians save regularly for retirement. And a recent report by the GIA-global aging institute shows that only 12% of India’s workforce is earning a pension. The retirement gap is widening, thus creating “a retirement crisis of potentially immense proportions in the future!"

Egypt

50% of millennials say they are not saving for retirement. 29.3% of the eligible population in Egypt are covered by the country’s MOSA Social Solidarity pension fund as per PensionWatch.Net, and 19.3% of the population over the age of 60 are covered with a monthly benefit of as low as 300 EGP (63.98 AED). How is that pot at the end of the rainbow looking for them?

Australia 

38% of the workforce in Australia say that they will not save enough for retirement. And “at the moment, two out of every five people, who retire at the age of 65, have no superannuation (pension benefits) at all," reports abc.net. That is an alarming 40%!

USA

21% of Americans have nothing at all saved for the future, as indicated in a recent study. 33% of baby boomers (the generation closest to retirement age) have between $0-$25,000 (0- 91,750 AED) in retirement savings and 61% believe that social security will not be sufficient to take care of their needs. Thus, creating a fear of retirement in the country. Can you blame them?

UK 

A recent survey showed that  50% of people were not saving for retirement, 10% have no savings at all, and 35% were worried that they may not have enough money, when they retire. This, the survey suggests, is in large part due to the lack of understanding of pension funds and how they work. So, what is the solution?

There you have it; we can agree that the numbers are a cause for concern. So, ask yourself this: What is my retirement plan?

What is a retirement plan?

A "retirement plan" is any long term (10 years or more) savings plan, which will give you a means of income once you decide to leave the 9-5 behind you for good. So where do you start? Here are the key questions to ask yourself when planning for retirement.

Where do you want to retire?

What age would you like to retire at?

How long do you expect retirement to last?

Will your dependents (if any) be financially independent when you retire?

What level of income will you need in retirement?

What savings do you currently have?

Once you have thought of all this, it’s time to put it all to action with our top tips.

1. Asses your household expenses. Identify fixed costs and prioritize retirement.

2. Create a monthly budget. And commit to it.

3. Do your due diligence. For the fixed income component of your retirement plan portfolio, research the market for the best interest rates.

4. Investing 101. Find out how to best invest your hard-earned dirhams.

5. Choose the best financial products to see your savings grow.

You are ready! Kick start your retirement plan to secure your future fun.

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