JOHANNESBURG – Life expectancy within the global context has been increasing rapidly, which enhances the growing risk of outliving your retirement savings. According to the World Economic Forum, individuals born in 2017 are expected to live to the year 2117. The obvious consequence of this is that it would be necessary to have enough savings to last more than 30 years after retirement.
This is echoed by research from the United Kingdom’s (UK) Department for Work and Pensions, which revealed that the number of individuals working past the age of 65 years, has more than doubled since 1995 - and this trend is expected to continue.
A common misperception is that reaching one’s retirement date is the end of one’s retirement savings journey when it is in fact only the beginning of the next phase.
Planning for a comfortable retirement is split into three key phases: the accumulation phase; pre-retirement stage; and managing your post-retirement finances. While each phase is unique, these phases are inter-linked and, if managed carefully, they should collectively result in a positive outcome at retirement.
Here is a more in-depth explanation of the phases: