The things women don’t often think about – retirement

January 6, 2016

It's hard to think about retirement at this point – most of us feel indestructible in our 20s and 30s, or have a husband to worry about these things. Usually, we’re so busy being caught up in trivial day-to-day tasks that we are more concerned with what's for dinner tonight, than how much money you need to save to retire comfortably.

As inevitable as it may seem – whether you're married, working or stay-at-home, retirement planning is particularly important but it's more so as a single parent, when you don't rely on anyone else’s income and need to make sure you’re providing for yourself when you stop working one day. It's scary to do, and I found myself in this space a few years ago when I got divorced. Suddenly I had to pay off a bond, AND worry about planning for when I don't work anymore.

While retirement planning can complicated and something we only tend to think about when it’s too late, there are a few simple tricks that can make it easier:.

Start early.

The earlier you can start saving for retirement the less you’ll need to put away each month to end up with the same retirement income. This is because you give your money more time to grow and work for you, rather than having to play catch-up if you only start when you’re older. 

Save through your company pension/provident fund or a retirement annuity.

There are major tax benefits to contributing to a retirement annuity or pension/provident fund, taking advantage of these structures will ensure you get the maximum benefit from your investment and allow you to save even more.

Save your bonus.

If you’re fortunate enough to receive a bonus don’t be tempted to spend all of it. Saving some of your bonus in a retirement annuity or similar structure will not only help you get closer to reaching your retirement goals, you’ll also get those tax benefits we spoke about earlier.

Choose your retirement fund carefully.

Depending on your goals and stage in life, a more conservative, low risk fund may be what you need or you may benefit from a more aggressive, higher risk fund. Speak to a financial adviser who can look at your unique circumstances and recommend the appropriate fund for you.

Don’t withdraw your pension savings early.

If you change companies it may be tempting to withdraw your provident fund balance to spend on that new car or holiday but this will only set you back and mean you have to save more in future. Rather transfer this balance to your new company’s fund or to a preservation fund.

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