It’s never too soon to start saving for your retirement

January 30, 2019 by Susan Paige

Unless you are fabulously wealthy, there will always be conflicting demands on your personal supply of cash. But putting money aside for something is an idea that more and more South Africans are beginning to adopt. It’s all part of the improving cash-awareness programs that the South African government and financial institutions are making available.

One of the big problems we have here in South Africa is the availability and security of cash itself. So, on a broader scale, and be more fully inclusive for all readers, we ought to use the word finance instead of cash. Why? Well, it is partly to do with the fact that the SA population is so widespread in terms of geography.

Joining the cashless society

South Africans really need to follow suit with other African countries like Kenya and Rwanda; counties which have the same problems of widespread communities, but who are taking the lead as far as spearheading the introduction of a more cashless society is concerned.

The biggest single impact in favour of cashless transactions was the introduction of mobile phones, Wi-Fi, and the new state of the apps that are now widely available. They have facilitated the ability to make many financial transactions electronically.

It makes for a much more secure way of handling money. In the old days, any cash that people were able to save was stashed away under their beds, or secreted somewhere else inside their dwellings. It was a recipe for disaster, and many people lost their life’s savings to thieves.

In today’s society, however, thanks to the availability of online technology and the ever-increasing infrastructure being rolled out to support it all over South Africa, the need for cash is becoming a thing of the past and as a result, saving money can now so much more secure.

Choosing the right savings vehicle for your retirement fund

Good security is key for any kind of savings, but when it comes to life savings and putting money aside for your retirement, making sure that money is safe is crucial. Imagine steeling yourself, going to all of the discipline and hard work that is necessary to save money, only to lose it all to some opportunistic thief? Unthinkable.

Choosing the right savings vehicle is incredibly important. There are some unscrupulous people around and pension scams, like the recently reported Amplants fiasco, are just as devastating as being robbed at home.

To avoid falling into the wrong hands with your savings, you must be very careful about whom you choose to look after your money. You should seek professional advice from someone reputable such as the Mutual Assurance Company.

Making a decision to start saving towards your retirement is one of the most important financial decisions you will ever make. Getting it wrong and not putting enough money aside or using the wrong savings vehicle could lead to a very unsatisfying autumn of your life.

Getting the best advice available

You need to follow the best advice available on how much you should be saving and what it will provide for you regarding income when you have to fall back on it. A state pension alone, will not be enough.

Too many young South Africans fall into the trap of not starting to save for their retirement early enough. It is understandable. When you are in your twenties and thirties, retiring seems to be such a long way off.

But the fact of the matter is that the sooner you start saving, the less you have to put aside, so starting early not only means you will have a bigger lump sum to look forward to, but it will be easier on your pocket (on a monthly basis) too.

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