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Well done on making it through Janu-worry.

It was touch and go until payday. Two-minute noodles may have been eaten on the home stretch.

Just because you made it to the next payday doesn’t mean you’re off the hook. In fact, as tough as stashing away a little money each month can be, failing to do so is really just kicking the can down the road.

Start planning for your financial future now. Stop putting it off. You can do this.

According to a recent BusinessTech survey, which prompted more than 2 700 responses, in excess of a third of South Africans aren’t putting any of their salary towards saving for retirement:

The poll of 2,702 readers, conducted in mid-January 2022, shows that the majority of respondents (61%) are allocating 10% or less. By comparison, 23% of readers are putting away more than 20% of their salary every month towards retirement.

This aligns with data published… in October 2021 which shows that 64% simply cannot afford to save because there is nothing left at the end of the month.  Almost three-quarters of people (74%) believe they will have to generate some income after they retire.

The National Treasury is well aware of the problem, with a December report showing that the average South African household saves just 2% of its GDP per annum.

A terrifying stat compounded by the fact that many access their retirement savings whilst unemployed.

As a rule of thumb, you want your retirement savings to equate to around 75% of your final salary in order to live comfortably. Assuming you work for between 30 to 40 years, you would want to save the following percentage of your salary:

• 15% if you start when you are 25
• 24% if you start when you are 35
• 43% if you start when you are 45
• 60% if you start when you are 50.

Compound interest is your friend.

Or, put another way, the consequences of decisions made today will bear fruit over the years based on the sound principles applied at their inception.

That’s the motto of Consequence Private Wealth, which promises to partner with you and your family to protect and build your wealth.

I’m okay with eating a pack of noodles now and then as payday nears, but that’s not how I want to spend my retirement.

[source:businesstech]