Planning for retirement can be quite daunting as there may be a lot of decision-making steps involved in the process. Know how much you need for your retirement? Try out our Retirement Calculator!
Then, ask yourselves these questions that you may need to answer in order to effectively plan for your retirement.
Why do you need to save for your retirement?
Singaporeans now have a much longer average lifespan than ever. As such, you may need to save more money in order to support yourself for at least three decades. You should ask yourself why you need to save, if that’s not clear already; the answers can and will motivate yourself to start preparing your financial plan.
Where do you see yourself during your retirement years?
You can have a lot of fun answering this question. Do you want to travel around the world after you retire? Do you want to move into a less urban community where the cost of living is less? Do you want to stay in the general location of your children?
By imagining where you would like to spend your retirement years, you can get an idea of the kind of lifestyle that you need to support. Your ideal retirement setting can help you determine how much you need to save.
When do you want to retire?
Do you want to retire when you reach your 60s? Perhaps, you would like to retire even earlier. Answering this simple question can help you set a timeline for your financial goals.
What are the available investment options for your retirement?
Now that you are motivated to save, and knowledgeable about how much you need to save, start looking at the different investment options for you. The Singaporean government has put in place a Supplementary Retirement Scheme or SRS. This scheme offers tax benefits in order to encourage you to save for your retirement.
The Central Provident Fund or CPF Board also offers two types of annuity plans under the CPF Lifelong Income for the Elderly or CPF LIFE Scheme. Aside from these retirement plans, you can also invest your assets in stocks, mutual funds and bonds.
How can you save enough money in your retirement plan to sustain yourself in the future?
How can you effectively allocate your assets? One way is to be consistent in contributing to your savings.
Who can help you plan your retirement?
Remember not to go through your retirement plans alone. Discuss these questions with your personal financial planning or spouse and children. Your family cares about you, and can help you make big decisions. You may also want to discuss your plans with your close friends, especially those that are in the same boat as you are. Be open to their point of views.
If you are new to investing, you can also get assistance from a certified financial planner. You can get a lot of ideas for your retirement plan by engaging with your family and friends as well as trustworthy financial experts.
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