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The day I hang up my metaphorical boots, I want to know that I have enough stashed away to live comfortably for the rest of my life.

Nothing too extravagant – for that I will buy lottery tickets and dream of months-long jaunts around the world.

Even the most meticulous planning can throw retirement plans into disarray, especially with the extreme market volatility and uncertainty of late.

Some global factors, like Russia invading Ukraine and COVID-19, are nearly impossible to mitigate against.

Speaking to BusinessTech, certified financial planner Tanita Conradie has outlined four potential spanners in the mix for South Africans and how you can overcome them.

Longevity risk

As a result of medical and biotech advances that combat disease and allow us to live longer, it is now necessary for retirees to be able to sustain their savings for a longer time period, said Conradie…

To combat this, you can choose a life annuity instead of a living annuity when retiring.

“The former is a sensible option if you are concerned that you will outlive your retirement savings because a life annuity provides you with a guaranteed monthly income for life,” said Conradie.

The obvious drawback here is that you can’t pass on that money to your heirs, but you do reduce the chances of ever placing a financial burden on them should your retirement savings run out.

Expected and unexpected expenses

…unexpected expenses for emergencies should be anticipated and catered for, and so too inevitable costs associated with healthcare and elderly care, said Conradie…

She added that the best protection against the possibility of serious health scares is to take out a risk policy, ideally in one’s younger years, to cover critical illness for the extent of their life.

Speaking to financial advisors like the team at Consequence Private Wealth, who partner with you and your family to protect and build your wealth, will help with a better understanding of the protections on offer to best prepare for anything retirement can throw at you.

Family commitments

Circumstances could likely arise when you have to make sacrifices to assist a love one during a crisis…

One of the most important steps is to draft a will so that your family’s future is not determined by outside parties and rules as dictated by the Intestate Succession Act, said Conradie.

Preparing your will might sound daunting but it’s really a relatively simple process and should be done as soon as possible so that you don’t leave headaches behind for loved ones.

Market risk

If you are in or close to retirement, then time is the one luxury you do not really have and, therefore, you face greater risk from market dips…

“You can reduce your risk to some degree by obtaining impartial advice from a financial advisor on the best way forward,” said Conradie.

For those with portfolios weighted heavily toward listed equities or other areas which have taken a pounding recently, now is not really the ideal retirement time.

By having a well-rounded portfolio, there could be slightly less of a headache.

I’d also suggest regular reminders to your children about everything you sacrificed for them along the way. One day, when you’re old and grey, you can start calling in those favours.

[source:bustech]