Retirement planning: Living with ease in your golden years
“Never dip your fingers in the cookie jar.”
Retirement is the point where a person stops employment completely (or decides to leave the labor force), usually reaching the mandatory age of 65, or earlier for some. A lot of Filipinos never liked the idea of making necessary changes to their lifestyle especially when time comes that they need to create a new chapter in their lives. For most, retirement is a dreaded word as it ends their career—no more active income from salary or just get older.
On the other hand, I still believe that we can do something, before this turning point comes to picture, by creating a retirement plan. Let me give you some facts about how Filipinos view retirement:
According to an ABS-CBN news report in 2008, 83 percent of Filipino workers intend to keep a job after retiring, higher than the global average of 54 percent and the highest among all 26 countries surveyed.
As early as age 28, Filipinos are already thinking of retirement, which is much earlier than the global average of age 33 in a survey.
Due to advances of health care and medical science, many retiring Pinoys are living 30 years or more after retirement, meaning they need far more financial resources to live within their desired lifestyle.
Most elderly Filipinos, rely on Social Security Services (SSS) and Government Security Insurance Services (GSIS), which offer this retirement benefits that may no longer provide enough retirement income in the near future. Also, cradle-to-rave benefits or job security for downsizing companies are no longer provided.
Tax laws and inflation rate due to economic conditions may change or vary yearly or so. Sandwich Generation is very common trait among Filipinos who are family-oriented or -centered. They are relying on their children or sometimes relatives who already have their own families.
Eight million Filipinos have no pension or retirement savings at all according to a National Statistics Office (NSO) report.
Still worried about what to do now? Here are the five simple steps to retirement planning:
Have a plan. This would require realistic goals and approach on how you would need in the future if you retire. This would require crunching the numbers especially in determining the age of your retirement and how much you will need in the next 30 years more if you intend to retire at the age of 60. There should be clear objective in making your plans. Example: Planned Retirement Age: 63 and your retirement portfolio is P20 million.
Start early in life. Saving should be an automatic reflex and a discipline to develop when we are still young, strong and agile.
Consult an expert. A registered financial planner is a professional individual who could give you sound and crucial advices in helping you in your retirement planning decisions and processes. They can also provide a tailored retirement plan fit to the needs of client. They can also provide other services from financial/investment products available in the market like mutual fund, UITF, insurances and other services.
Track and review your plans annually. There is a need to look over your plans and documents on a yearly basis. There could be some slight changes you need to continue or forgo. Such plans could be applicable or no longer achievable, especially under the estate planning of some individuals who require this specialized service or even the asset allocation portfolio of existing investment of some individuals to put things into order.
Don’t dig into your retirement savings. Never touch this golden fund at all cost. A good way to start manage your finances is to set aside and build for contingency fund in times of crises and emergencies arises. “Never dip your fingers in the cookie jar.”
Remember the golden rule in financial planning is to be prepared at all times, and the time and effort you spent will bear the fruits of labor when we get older to live a comfortable life in the golden years.
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If you want to learn more investments for your retirement planning, you can attend the Financial Fitness Forum 2014 this Saturday, March 29, at the SMX Convention Center in SM Aura in Taguig City. The forum co-presented by BPI Trade.com, will feature all RFP speakers who will share their advice on how to grow your money and build wealth. Be one of the first 50 to register and avail yourself of 50-percent off by texting your info at 0917-3464126. Visit www.financialfitnessforum.org for more info.
Benedict Baluyot is a Registered Financial Planner of RFP Philippines. He is professional real estate broker with specialization in project selling and general brokerage of different estate properties from different local and national developers in Pamapanga and Metro Manila residential and condominium projects.
Source: http://www.businessmirror.com.ph/index.php/en/business/banking-finance/29470-retirement-planning-living-with-ease-in-your-golden-years
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