Retirement Mistakes

Retirement is word that mean to go, of Relax and Take It Easy.

But common mistakes turn it into STRESSFUL period in senior’s lives as well as their families.

To make matters worse, the low interest rate regime in recent year has wipe out a big portion of retires expected income.

This article talks about common Retirement Mistakes and How to correct them?

Top 4 Mistakes in Retirement Planning

Not having a plan or Falling to plan
Delaying planning- waiting too long before starting to plan.
Depending on your children
Depending on government pension.

If you are near on retirement and you fell that you have not save enough, then your options are;

Delay your retirement – so you plan to retire at age 60 maybe perhaps you can retire at age of 65. That would give you several more year to save for your retirement and the number of years you spend retire will be shorter, you need smaller amount.
Work after retirement – you can always have do some income generating work when you already retire. Retirement is not only mean you stop working. You will have additional income to can fill the shortage.
Live a less expensive life style – when the resources are limited you have to be smart about it. By living less expensive life style that you will not need so much you are your retirement.

The BEST time to start retirement planning is when you get your FIRST SALARY.

But the reality a lot of people start planning for retirement in their 50’s.

For some people who have set aside little money. The current interest rate situation for the fix income investment is very low; is not ideal to very conservative investor, like time deposit account; interest rate 1.375% per annum, and fix income instrument like bonds and treasury bills; interest rate 3% depending on the loan period.

What happen is you need to save MORE money in order to have enough retirement funds.

So; existing interest rates are not very good for the conservative investors. Consider alternative investments with higher potential gains.

Best strategies for early retirement planning.

If your 20’s and 30’s;

Use 80-20 allocation:

80% in high risk investment (Stock Market or Equity) and 20% in low risk investments.

If your 40’s

Use a 50-50 allocation

50% in high risk investment (Stock Market or Equity) and 50% in low risk investments

In your 50’s or 60’s

Go to 20-80 allocation:

20 in risky assets, and 80% in safer instruments.

Low Risk low return Fund: Balance Fund, Money Market Fund, Treasury Bill.

High Risk high return Fund: Stocks(Stock Market Investment) or Equities.

Happy Retiree

Did you know for 2000 pesos a month for 30 years, you can retire millionaire. Have enough funds for the retirement years.

Let say every salary you set aside a 2000 pesos per month and considering your investment will grow 12% per year. In 30 years time you will have 7 million pesos.

What if you can set aside 5000 pesos per month or 10000 pesos per month?

Choose your retirement wisely, in your 60’s

Remember the earlier you invest the more you can accumulate. Time o panahon ang kasapi natin sa pag-invest. Kaya wag patagalin.

Maybe you’re wondering if its possible? and what investment instruments?

My answer is, You can invest in Stock Market.

There are to ways to invest in Stock Market.

Through Mutual Funds – is professionally manage funds, where experts manage your money or investments. It has term when you can withdraw it and fees in every year. You can subscribe Equity Mutual Fund or ask any corresponding funds that invested in the stock market. I like Sunlife.
Through Broker – serve as middleman between You and Philippines Stock Market. Where you can choose company to buy. So meaning you manage your investment personally.

In this case if you don’t have knowledge of a company you up too. Then it’s not ideal to invest in that company. You have to study, financial reports of the company you what to buy, for the reason you have to find out if it’s still growing or stable for the next 30 years or  it’s about to lose.

These how we can minimize risk investing on stocks.

For individual that don’t have time to study financial reports. Don’t worry still we can invest in stock market.

Like me I did leveraging man works. I subscribe on a club that will guide me on my investment in stock market, regarding what company to buy and what price to sell. This will ensure that we don’t sell or panic when market went down and give alert when stock reach to our target price. It’s give as peace of mind. And reports regarding what happen to the World Stocks and Philippines Stock Market so that we have an idea. And more sooo much this Club can guide us.