A Menu of Financial Choice

1. The Aperitif $ When aged 20s to 30 – Wine and Dine now and live life to the full!
2. The Entrée $$ Aged 31 to 40– A little less of the Booze and an occasional Cruise…save for a future
3. Main Course $$$ “Work Free” (at age 45) wining and dining with clients that fuel a Passion…lots of cash in the bank, and fund purchases too!
4. Dessert $$$$$ Aged 55 to 101- Sweet and Modest – Eating moderately and tasting an occasional good red wine. Time to wine and dine again and to live life to the full…thanks to a lifetime of financial planning for a carefully planned rosy dotage
5. After Dinner Port $$$$$ Aged 101 to 130 – For when that plant that gives eternal life is discovered in the remaining 3 square miles of the Amazon Forest.

(NOTE: Interesting that an ‘Entrée’ in Europe is an entry dish, as logic would suggest, but in the USA it is the ‘Main Course’ – it is amazing how incredible and different perspectives are on the same theme).

WANTED – Financial Independence

The older world call it ‘retirement’, which has several depressing connotations associated with it…like ‘the end of the line’, the end of an income stream, and the time to do the gardening.

GET SMART plan for a rainy day, plan for a lazy day, and that day when you don’t actually have to get off the beach, because commitments are unobtrusive and secondary in that carefully planned ‘job free’ zone of life in retirement.

At the End of the Line it all depends on the individual’s will and willingness -
It used to be that with the ‘good old’ companies a PENSION PLAN was part and parcel of the employment package….BUT these days, more often than not, individuals have to make their own plans for money in retirement.

“ I’m too young to think about retiring ”

For many people, the decision to save for a pension is the most important investment decision they will ever make. Retirement may currently seem remote to you and other “day to day” financial demands more pressing. Yet undertaking a simple and flexible retirement programme, whatever your present age or future plans, is a wise and rewarding decision.

“ Or am I ? ”

Increased longevity, earlier retirement and higher expectations in retirement are all compounding to heighten the need to plan, more effectively, the financing of those “golden years”. Imagine for a moment how you would feel if, after a lifetime of work, you had insufficient funds to enjoy your hard earned retirement.

One of the leading providers of international retirement plans, estimates that an individual’ with a salary of $35,000 a year, with full pension entitlement would receive a pension of 23% of pre-retirement income: a 77% fall in income.

A report published by the Office of Fair Trading in 1998 in UK stated that in order to receive a pension targeted at two thirds of final salary at age 65, individuals would need to save a high proportion of their income each year until retirement. The amount required depends on whether or not they already have savings:

Here are these interesting and important statistics:

These figures show you what percentage you need to save in order to receive a retirement income equal to 2/3rds of the final year of a working salary.
If you started saving …

At age 25 you only need to save 10% of your income every year till retirement

It is clear to see from these figures what the “cost of delay” can be if you do not save early in life. Take note that if you wait till your 50s to start a plan, you might have to save 50% of your income to get yourself a sensible pension income – ridiculous you might say! But how much are you saving these days?

It is clear and obvious that the time to start a pension plan is as early as possible, AND if you have not already started then NOW is the time to begin.

The Age Old Question

The sources of pensions to meet our higher expectations are becoming less and less certain. Additionally many existing company schemes penalize employees, at least, in respect of the employer’s contributions, if they leave with only a few years’ service.

The fact is that a personal pension fund is the essential way to provide the capital and income necessary for the fulfillment of your retirement expectations.

Seek expert know-how and give yourself the opportunity to make informed decisions based on sound advice. Campbell Alexander’s recommendations are completely confidential, free and without obligation. Contact me at: brucecurran@campbellalexander.com

After all, if you fail to plan, you plan to fail! Save now for a better future.