I’m 43 years old and my current retirement plan seems like it will only last a few years post-retirement. How can I ensure that my plan covers me for the rest of my life once I retire?
Gerhardt Meyer, Strategic Technical Manager at PSG Distribution, responds: It’s a good sign that you’re looking at your retirement goals at an early age. One needs to set these goals and diligently start saving from when you start earning an income. The average person has 30 to 40 years to work and save towards their retirement, so you need to also factor in an expectancy to potentially prolong your savings and investment strategy as part of our overall plan.
One of the most important starting points is to create an investment strategy that combinedly captures your risk tolerance and risk capacity, and can calculate the actual risk required to reach your goal. The best way to make sure that this is safe and accurate is through the help of a financial adviser, who can, on an ongoing basis, assist you with growing and adjusting your plan as your life unfolds.
We use the term ‘longevity risk’ when referring to the risk of outliving your savings, which is a really big potential risk faced by most retirees. As life continues, the goalposts for your retirement plan might shift slightly, but the essence will remain the same – you want to spend your last years living comfortably without worries.
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