Cape Town - Your golden years are supposed to be a happy eventuality, but they could be dark if you fail to save for them, warned Old Mutual Personal Finance advice manager Priya Naicker in an interview with Fin24.
When we don’t put money away for our retirement, we are actually robbing ourselves from our right to retire, according to Naicker.
"A lot of people still expect the state to take care of them when they retire, but that's problematic if you look at the current level of state pensions," said Naicker.
She also advised against starting to save too late in your life, saying that opportunity costs for starting later are high.
"If you delay saving for retirement to age 35, you almost have to double the amount that you would need to sacrifice from your salary. If you delay it to age 45, you would have to save an unreasonable amount - up to 50% of your salary,” Naicker explained.
Many people are still saving in informal savings vehicles like stokvels, grocery schemes and burial societies, but a wealth of alternative savings options are also available.
Naicker said it is hugely beneficial for everyone to have a financial plan and a financial adviser.
"The advent of tax-free savings accounts also allows you exposure to markets and (to) have tax benefits," she pointed out.
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