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Financial independence key to happy retirement

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(Shutterstock)
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Johannesburg - Financial independence is the key to a secure and happy retirement, according to Daphne Byers, advice partner at The Wealth Corporation.

"The good news is that achieving such a state is a lot easier than you’d think. Rather than lots of money, what is required is a lot of discipline," explains Byers.

She says, although most people understand the term "retirement", the same is not the case with an understanding of the term "financial independence".

A financially independent person, in her view, is someone whose assets generate sufficient income to meet their expenses.

"This is a far more modest definition than most people come up with. Many people consider financial independence as being synonymous with being rich firstly and retired secondly," says Byers.
 
"Sensible savings and investment habits, along with sensible spending habits over the long term, are all that’s needed. That being said, delayed gratification can be a hard pill to swallow."

READ: Most fantasise about wealth, not wealth building

Financial plan

She says what you need is a sound financial plan that takes your current circumstances into account, as well as your long term goals. That way, when you’re forced to choose a “need” later over a “nice” now, you’re better able to do so.

"You also need a sounding board to help you make life’s big financial decisions and a hand to hold when markets fall, along with your confidence," she says.

"A financial adviser will be able to help you to determine your lifestyle goals in the future and construct a financial plan to help you to realise your goals."

ALSO READ: Simple steps to achieve financial freedom

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