Never Too Late For Retirement Planning


“Help! I turned 58 this year and, thus, am nearing retirement. I’m paid well by the company I work for. For years I’ve relied on my monthly salary for all my family’s expenses. It’s always been enough. But I don’t have any savings. What do you recommend I do?”

[JJT]: Retirement is something we always tend to overlook because one, we attach it to a number that is usually 20, 25 or even 30 years from the time we first thought about it. In short, there’s no sense of urgency. And two, we don’t know what’s in store for us in the future, so we tend to have that YOLO (you only live once) attitude than prepare for a long life. Then as we get closer to that retirement age, we wake up and realize that we’ve lost so much time.

But let’s not look back at what could have been and focus on moving forward. As soon as you read this, start working on these things as you prepare for your retirement:

Start saving. We might have waited far too long to start saving, but as the saying goes, it’s “better late than never.” From your monthly paycheck, set aside 20 percent to 30 percent of your income and never touch this for anything other than for real emergency. If you can save more, that’s even better, but at least 20 percent should be good. Put this amount in an instrument that is not as easy to withdraw but still gives you liquidity.

Regular savings or time deposit accounts are good options. You can have a combination of both, so you can have liquidity, at the same time, be able to maximize the opportunity of earning more from interests with little or no risk.

Start living below your means. The road to a comfortable retirement is not rocket science. We should still practice the most basic principle of living below our means. This simple lifestyle will help you boost the amount of your regular savings. Imagine, even the famous investor, Warren Buffett, whose net worth at age 87 stands at more than $80 billion, still lives in the old house he bought in 1958 reportedly for less than $32,000. So there’s no reason for us not to live a frugal life now if we want to live comfortably in the future when we can no longer earn a living. Look for expenses that are not necessary and try to lower your spending on these, or eliminate the unnecessary expenses altogether.

Find other income streams. To increase your cash flow even more, consider getting other jobs or a second income stream. It may be a stretch to work two jobs at 58, but it can help you add more savings. If possible, look for low-cost income streams where you will invest little/no money but more of your time and effort. For starters, you can use your other talents to monetize any of them. Or maybe start a small business in your work place that does not violate any company rules, or cause any conflict of interests.

Look for passive income opportunities. The key to retirement is being able to generate passive income streams that can support your retirement lifestyle. The earlier you can establish this, the sooner you can retire. So look for passive income opportunities that will provide you regular income without exerting too much effort, even after your retirement. This usually comes from either rental income or a business income. The challenge, though, with getting into other income streams, especially if you are going into a business, is that at a late age you may not be able to take too much risk because of the time factor. However, you can make calculated risks by understanding what you are getting into and having a business/financial plan in place.


Jeremy Jessley Tan, RFP®, is a registered financial planner of RFP Philippines. To learn more about personal financial planning, attend the 66th RFP program this November. To inquire, email or text <name><e-mail><RFP> at 0917-9689774.


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