Let’s start with some indisputable truths…

If it can go wrong, it will.

Nobody puts the USB in the right way the first time.

There’s always that one word that you will never spell correctly the first time.

And, finally, just like almost every other human on the planet, you will eventually retire.

How and when you retire depends on how well you’ve prepared in the years leading up to it, and South Africa has one of the worst savings rates in the world, of just 15,4% of gross domestic product (GDP).

It’s a sobering thought, especially when you consider that, according to BusinessTech, in South Africa, only 5% of people retire with enough income to be comfortable.

The below graph shows the multiple of salary that someone needs to have saved to ensure that they are on track to get a reasonable replacement ratio at retirement.

By the age of 40, you should already have saved just over three times your current annual salary to be on track for a 75% replacement ratio at retirement.

If you decide to stick it out a little longer in the workforce, retiring at 65 instead of 55 can almost double your replacement ratio. The graph below shows the impact of retiring at various ages for a person aged 25 contributing at 11,75% of their salary.

The rule of thumb is that you should consistently save between 15% and 20% of your monthly salary between the ages of 20 and 60.

If all of this sounds daunting, there’s a simple way to make sure that you’re investing correctly in your future, without the stress of figuring it all out by yourself.

Consequence Private Wealth can help you get your financial affairs in order, which is something that you should do sooner rather than later.

Developing a relationship with experts like Consequence Private Wealth helps you to plan ahead and manage your immediate finances, investments and savings.

The best part is that handing the hard work over to the pros frees you up to enjoy your working years with the knowledge that your hard-earned retirement really is something to look forward to.

[source:businesstech]